Portugal Backs Down on Tough Labour Reforms but Keeps Hiring Flexibility

Workers across Portugal woke up this week to the surprising prospect that several of the most contentious labour-law amendments may never reach Parliament’s voting floor after all. The government, accused by the Communist Party’s Paulo Raimundo of staging a theatrical concession, is signalling it could discard some of the proposals that unions labelled “repulsive” while keeping the core of its reform package intact.

A moment of brinkmanship

Paulo Raimundo, newly installed at the helm of the Portuguese Communist Party (PCP), used a rally in Almada to predict what he called the executive’s next “move on the chessboard”. According to the opposition leader, Prime Minister Luís Montenegro intends to retreat on the most eye-catching measures—such as the return of the 180-day trial period for first-time workers—in order to claim an image of moderation, all the while preserving provisions that quietly shift power toward employers. The accusation landed days before the start of a fresh round of talks in the Concertação Social forum, where unions, business confederations and government ministers formally negotiate.

The disputed measures in focus

The reform, marketed by the cabinet as “Trabalho XXI”, spans more than one hundred articles of the Labour Code. Union federations CGTP-IN and UGT have trained their fire on the restoration of the individual bank of hours, the loosening of telework refusals, stricter limits on breast-feeding exemptions, and the extension of services-minimum obligations during strikes. Employers, by contrast, are lobbying hardest for broader use of fixed-term contracts and an end to the one-year embargo on outsourcing after redundancies.

What the government may quietly shelve

Sources in the Ministry of Labour concede that at least three ideas have already been earmarked for the shredder: halving the compulsory training hours in micro-firms, allowing dismissals after fraudulent self-certified sick leave without a court ruling, and making parents of young children work night or weekend shifts if management demands it. Even so, officials insist the flagship goals—greater “flexibility” of schedules and simplification of hiring rules—will survive the trimming exercise. Raimundo argues that dropping a few “grotesque details” does little to alter what he sees as a systematic assault on employee protections.

Union tactics heading into a December showdown

CGTP-IN’s secretary-general Tiago Oliveira and his UGT counterpart Mário Mourão rarely share the same platform, yet both now endorse a nation-wide general strike set for 11 December. Their calculus is blunt: only a show of street strength can deter Parliament’s conservative majority from rubber-stamping the bill before Christmas recess. The walkout, Oliveira says, will target transport hubs, schools and healthcare but aims to keep emergency services intact so as not to alienate the public. Raimundo’s PCP is counting on that momentum to expand its electoral foothold among younger, precariously employed voters.

Business lobby stands firm

The Confederation of Portuguese Business (CIP) believes the draft “strikes a fair balance” between productivity and rights. President Armindo Monteiro contends that even the potential back-pedalling on training hours and dismissal procedures is acceptable if the reform achieves its prime objective: bringing Portugal’s unit labour costs closer to the euro-area median. He calls the planned strike “disproportionate” and warns that investor confidence could suffer, echoing concerns from multinational firms operating shared-service centres in Lisbon and Porto.

Why households should care

For families juggling rising mortgages and record electricity bills, the stakes go beyond ideological skirmishes. Re-introducing the individual bank of hours could lengthen working days to fifty hours during peak periods, disrupting school pick-ups and elder care arrangements. Conversely, if Parliament forces the government to scrap that clause, firms may respond by leaning even more heavily on fixed-term hires, perpetuating the cycle of short-term contracts that already afflicts a third of workers under 35. In rural areas—from the Alentejo vineyards to the textile mills of Vale do Ave—the final shape of the law will determine whether seasonal shifts become easier or harder to schedule.

The road ahead

Parliament’s Committee on Labour Affairs is expected to release its first consolidated text in early January. Montenegro’s Social-Democratic minority will require either the centre-right CDS or segments of the Socialists to pass the reform article by article. Should opposition amendments accumulate, the prime minister can still merge the surviving provisions into an omnibus decree-law, although that option risks a constitutional challenge. Raimundo vows to “fight clause by clause” and hints at further mobilisations in the spring. Whether the public sympathises with strike calls or fatigue sets in may ultimately decide how far the most controversial parts of Trabalho XXI travel from draft to the Diário da República.