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These amendments are introduced by Decree-Law no. 115/2023, of December 15, and will come into on January 1, 2024.

The Work Compensation Fund (WCF) is converted into a closed accounting fund, which is now made up of each employer's global accounts in it.

The balance of each employer's global account is the result of the sum of the balances of the individual accounts of each of its employees, which are extinguished and thus merged into a single global account. From this balance, debts to the Work Compensation Guarantee Fund (WCGF) and operating costs are also deducted.

Each employer's balance may be checked on the Compensation Funds portal, after the employees’ individual accounts are merged into the global accounts of their respective employers. The balance is then updated monthly.

According to the information provided by the abovementioned portal, it estimates that employers' global accounts will not be set up and accessible until February 15, 2024.

Since WCF is now a closed accounting fund, employers' obligations to join it (or to join an equivalent mechanism), as well as to make payments to WCF regarding their employees, come to an end.

Are also terminated:

• Any ongoing administrative offense proceedings and debts relating to amounts not delivered by employers to the WCF, as well as related interests;
• Initiated and ongoing judicial or pre-judicial proceedings to collect amounts owed by employers to the WCF, as well as related interests.

1.2 New WCF objectives

To put an end to the existent uncertainties in this regard, Decree-Law no. 115/2023, of December 15 clarifies that payments to the WCF (and to the WCGF) for April 2023 are not due.

WCF was initially created (back in 2013) to help companies meet their obligations to pay compensation to employees on termination of their employment contracts. The WCF thus operated as a capitalization fund, which could be used by employers whenever it was necessary to pay the compensation to their employees due to the termination of their employment contracts, up to a limit of 50% of the amount of the compensation at stake.

Decree-Law no. 115/2023, of December 15 introduced new objectives for the WCF:

• Supporting costs and investments in employees’ housing;
• Support other investments agreed between employers and workers' representatives, such as the construction of day care and canteens;
• Financing the qualification and certified training of employees.

1.3 Employers’ access to their WCF accounts

Employers will be able to access the balances of their global accounts as soon as these accounts are set up, and provided that such access is for any of the objectives of the WCF.

Access to the balances of the global accounts is made at their value in euros on the date of their creation. Access to the accounts may occur between the last quarter of 2023 and December 31, 2026.

In the case of balances of less than € 400,000.00, they can be used up to two times (regardless of the value of each use).

In the case of balances of more than € 400,000.00, they can be used up to four times (regardless of the value of each use).

It should be noted, however, that according to information available on the Compensation Funds portal, it is estimated that the procedures for setting up employers' global accounts will not be completed until February 15, 2024. So, employers’ access to their balances is not expected to be possible before that date.

Employers shall be aware of the maximum times available to access their accounts in order to use the entire amount therein, since it is not expected that the amounts that remain there could be used later on.

To access the respective balance, the employer must request it on the Compensation Funds portal, stating under oath:

• The amount to be used;
• The destination of the amount being used;
• If the destination of the amount is to support costs and investments in employees’ housing or financing the qualification and certified training of employees: that the obligation to consult the employees’ representatives was observed and that there was no reasoned opposition or, if applicable, that prior communication to employees was observed.
• If the destination of the amount is to support other investments agreed with the employees' representatives: attach a copy of the agreement reached.

If the destination of the amount used is to support costs and investments in employees’ housing or financing the qualification and certified training of employees, the employer must first consult the employees' representatives or make a prior communication to the employees (if they do not have any representatives).

For this, employer shall consult workers' committee. If a workers’ committee does not exist, the inter-union committees, trade union committees or union delegates shall be consulted.

These employees' representatives have 10 consecutive days to oppose the employer declared intention to use an amount on it WCF account, and may only do so on the following grounds:

• Use of the amount to different purposes;
• Nonobservance of the principles of fairness and equal opportunities and treatment.

If there are no employees’ representatives, the employer only has to notify the employees directly with a prior notice of 10 consecutive days before the date of using an amount on it WCF account.

If an amount on the employer’s WCF account is used by the latter to pay 50% of the compensation due to an employee upon his/her dismissal, there is no need to prior consultation, agree or communication to the employees’ representatives nor to the employees directly.

The most important change introduced by Decree-Law no. 115/2023, of December 15 regarding Work Compensation Guarantee Fund (WCGF) is the suspension of:

• Communication of listing in the WCGF. This communication used to be made directly by the employer and will from now on be made by Social Security (as soon as the suspension ends);
• Creation of debts to the WCGF and the procedures for pay them.

This suspension will last while the “Medium-Term Agreement on Improving Incomes, Wages and Competitiveness” is in force.

It should also be noted that payment obligations to the WCGF remain suspended for the same period (as previously determined by Law no. 13/2023, of April 3).

The WCGF will also be capitalized with transfers from the WCF regarding:

• 50% of the annual surplus balances that the WCGF transferred to the WCF between 2016 and 2023, less the expenses incurred by the WCF to collect income between 2013 and 2023, as well as the operating costs borne by the WCF and the Instituto da Informática, I.P.

• The balances of employers' global accounts that are not redeemed or that prove impossible to transfer.