New amendments introduced to the TUPE legal framework in Portugal

Portugal - 09 / 04 / 2021

Labor and Employment Law Alert Portugal

Law no. 18/2021, of April 8, was published in the official gazette, introducing amendments to the applicable regime in case of Transfer of Undertaking (Protecting of Employment), or parts of undertaking that constitute an economic entity (TUPE).

1. TUPE in case of execution of service providing contracts

Portuguese Labor Code was amended to stress out that the transfer of undertaking (or part of undertaking that constitutes an economic unity) regime – with consequent transfer of the employer’s position in the employment contracts of the employees at stake – is applicable in case of tender procedures to execute service providing contracts.

The service providing contracts that constitute a transfer of undertaking (or part of undertaking) may come as a result of a public tender procedure or through any other procedure to select and execute service providing contracts, in public or private sectors, namely surveillance, food, cleaning or transport services.

In these cases TUPE regime prevails over any provision set forth in Collective Bargaining Agreements (CBA), except if the CBA’s provisions improve the legal conditions for the employees.

2. Request for labor authorities participation in the procedure

According to Portuguese law, both employer and employee representatives may request the participation of representatives of the Portuguese Labor Ministry (DGERT) in the negotiation meetings to be held between the parties.

The introduced amendments establish that such request must be instructed with the following elements:

Transfer of undertaking date;
Reasons for the transfer;
Legal, economic and social consequences for the employees;
Projected measures for the employees to be transferred;
Content of the contract executed (or to be executed) between transferor and transferee.

3. Entry into force

These amendments come into on April 9, 2021. However, they are also applicable to public tenders or other procedures to select and execute service providing contracts, in public or private sectors, that are ongoing or were concluded during 2021, including those in which the final contract was already awarded.