Decree-Law no. 210/2015 of September 25, published today, introduces amendments to Law no. 70/2013 of August 30, establishing the legal framework of the Work Compensation Fund (“WCF”), of the equivalent mechanism (“EM”) and of the Work Compensation Guarantee Fund (“WCGF”), amongst which we highlight the following amendments: 

Scope

  • Excludes the employment relations emerging from employment contracts with a duration equal or not exceeding 2 months.

Introduction of deadlines

  • Up to 15 days after a transfer of business or undertaking (or a part of a business or undertaking) to include the employees in the WCF or EM.
  • 5 days for the employer to declare to the WCGF and, where applicable, to the WCF, alterations to the amount of retribution or seniority payments (diuturnidades).
  • If, after 1 year from the date of the termination of the contract, the employer does not request the repayment of the balance of the employee’s individual securities account and the potential increase of values, the employer shall be notified by the WCF to do so, within 30 days, after which the employer will not benefit from any potential increase of values.
  • 30 days for the WCF, WCGF and EM to notify the Labor Authority (ACT) of any breach by the employer. 

Suspension of payments

  • It suspends the obligation to make payments to the WCF when the balance of the employee's individual account reaches half the compensation limit amounts set out in the Labour Code.

Exemption from payments

  • The employer is exempt from payments to the WCF to the employee’s individual account whenever the employment contract recognizes a seniority, which entitles the employer to an amount of compensation higher than the limits set out in the Labour Code.

Both in case of suspension and exemption from payments, whenever the employee’s individual account balance does not guarantee half of the legally established compensation limits, the employer is notified to resume such payments.

These amendments will come into force on November 24, except those made to the scope, which enter into force tomorrow.