How much severance pay will I get in Portugal?
| Oct 2013 to Apr 2023: 8.17 years × 12 days | €3,922.85 |
| Since May 2023: 3.67 years × 14 days | €2,057.42 |
How it was calculated
Permanent contract: 14 days' pay per year since May 2023, 12 days between October 2013 and April 2023, 20 days between November 2012 and September 2013, and one month per year before that for older contracts. Fixed-term: 24 days per year. Salary counts up to a maximum of 20 minimum wages and the total has limits.
It does not include holiday pay or pro-rata amounts, which are paid separately. This is an estimate: check with the ACT (labour inspectorate) or a lawyer.
Example: your base salary is €1,000, you started in January 2020 and you are dismissed at the end of 2026 in a collective dismissal. Up to April 2023, 3.33 years count at 12 days a year, €1,332.60. Since May 2023, 3.67 years count at 14 days, €1,714.52. The estimated severance pay is €3,047. On a 2-year fixed-term contract that the company does not renew, it would be 24 days a year: €1,600.
Frequently asked questions
How many days per year of severance do you get?
14 days per year of work since May 2023, for permanent contracts; 24 days for fixed-term contracts.
Does someone who resigns get severance?
No. Severance is for dismissals initiated by the company and for the end of fixed-term contracts decided by the company.
Is severance pay taxed in Portugal?
Up to a limit, no. It is exempt up to 1.5 times your average regular pay over the last 12 months, for each year worked. Only the part above that pays IRS. The exemption does not apply if you are hired again by the same company within 24 months.
Is there severance pay if the contract ends during the trial period?
No. During the trial period (período experimental), either side can end the contract without severance pay, unless agreed otherwise in writing. You still get holiday and allowances in proportion to the time worked.
Is there severance pay in a mutual termination agreement?
It is not required. If there is any, the amount is whatever both sides agree. If the agreement includes an overall cash payment (compensação pecuniária global), it is presumed to cover everything the company owed you.