2022-10-20

 The  Portuguese government has enacted a recent regulation (Decree-Law 72/2022) adding new easing rules to those recently published (Decree-Law 30-A/2022), setting forth new measures aimed at fostering and streamlining the licensing of renewable energy generation and storage plants.

1.Construction

  • Installation of renewable energy generation facilities, storage facilities, UPAC (self-consumption), and hydrogen generation facilities is now subject to a simple prior communication procedure. A construction license and construction permit no longer are required.

  • Construction may only be rejected on grounds of lack of information, non-compliance with applicable regulations, or if the installation adversely affects the landscape. In the case of the latter, rejection cannot occur if (i) the project has been subject to a favorable or conditioned environmental impact statement, (ii) or if the municipal territory has an area less than 2% of the total area allocated for this type of project.

  • Construction of facilities with an installed capacity equal to or less than 1 MW are exempt from any prior control.

2. Compensation to Municipalities 

  • For each installed renewable energy generation facilities and storage facilities Municipalities are an entity to compensation of € 13,500 per MWh. This compensation will be supported by the Environmental Fund, not by the plant owner.

3. Agreements with the DSO/TSO

  • Projects,where grid capacity reinforcement agreements have been executed with grid operators that have already obtained a favorable or conditioned environmental impact statement will benefit from priority treatment over other projects graduated in the lists published by DGEG (Termos de Referência) to obtain a grid capacity reservation title (TRC).

4. 2019, 2020 and 2021 Auctions new benefits

  • Projects from 2019, 2020, and 2021 auctions may benefit from an additional 12-month period of trial operation (in addition to the 12-month period already provided by law).

  • Those awarded under: (i) Discount to the reference tariff, (ii) Variable premium for differences, or (iii) Fixed premium for flexibility will benefit from an increase to the applicable tariffs linked with the inflation rate from the year of the award until the project reaches COD.

  • Commissioning of the generation facility and the application of the specific remuneration scheme occurs within the deadlines set out in the auction rules plus any extensions granted and after the trial period has elapsed (if requested).

These rules new rules enter into force today, October 20th, 2022, and will apply until April 19th, 2024.

2022-10-17

A “Medium-Term Agreement on Improving Incomes, Wages and Competitiveness” (“The 2023-2026 Social Pact”) has recently been signed by the so-called Portuguese Social Partners (representatives of employers, unions, and the Government). It sets guidelines for employment collective bargaining on the increase of salaries for the years 2023 to 2026.

The most relevant provisions of the Portuguese 2023-2026 Social Pact in this regard are:

(i) The annual nominal appreciation of salaries per employee of 4.8% on average (appreciation of 5.1% in 2023; 4.8% in 2024; 4.7% in 2025 and 4.6% in 2026);

(ii) An increase of the minimum monthly guaranteed remuneration up to at least €900.00 in 2026 (increase to €760.00 in 2023; €810.00 in 2024; €855.00 in 2025 and €900.00 in 2026).

(iii) The increased remuneration for overtime work above 100 hours: (i) 50% for the first hour; (ii) 75% for each subsequent hour; (iii) 100% for each hour on weekly rest days or public holidays.

(i) A tax exemption on the meal allowance of up to €5.20 per day.

(ii) The increase to the severance compensation to 14 days’ salary per year of seniority in case of collective dismissal or job extinction.

(iii) An increase of 50% to the employer’s tax deductions regarding an increase in salaries (wages and social contributions), for all companies that have at least complied with one of the following conditions: (i) they have signed or renewed their collective bargaining agreements less than three years ago; (ii) they have annually increased salaries above the values of the 2023-2026 Social Pact and of their application framework collective bargaining instruments; (iii) they have reduced the difference between the remuneration of the 10% of better remunerated and the 10% of less well remunerated.

Employers must pay attention to the 2023-2026 Social Pact for the impact it will have on their labor costs, as the above guidelines can be construed as an instrument that, to some extent, allows anticipating the Portuguese companies’ labor costs in the forthcoming years.

2022-09-29

The legal background of entry, stay, exit and expulsion of foreigners from the national territory have recently been changed.

The same law that amended the legal regime for the entry, stay, exit and removal of foreigners from national territory also created the conditions for the implementation of the Agreement on Mobility between the Member States of the Comunidade dos Países de Língua Portuguesa (Community of Portuguese Language Countries - CPLP), concluded in 2021.

The amendments aim to attract a new wave of immigration to the country, in a regulated and integrated way, which may contribute to its development and mitigate the labour shortage felt in Portugal. The law also created the digital nomad visa.

The main measures include the following:

  • Visa For Job Hunting

The new visa for work search allows foreigners to enter Portugal to look for work.

The visa has a maximum duration of 120 days, extendable for 60 days.

With a view to simplifying procedures, the visa integrates the scheduling with the services competent for granting residence permits within 120 days of the visa's duration, conferring the right to request a residence permit, after establishing and formalising the operating agreement within that period.

  • Streamlining The Procedure For Issuing Visas For Nationals Of CPLP Countries

In situations where the visa applicant is a national of a State where the Agreement on Mobility between the CPLP Member States is in force, the procedure for issuing visas is facilitated.

The following changes have contributed to speeding up the process: (i) waiver of the prior opinion of the Serviço de Estrageiros e Fronteiras (Foreigners and Borders Service - SEF); (ii) direct and an immediate consultation of the Schengen Information System databases by the competent services; (iii) refusal to issue visas limited to situations where there is an indication of a ban on entry and stay in the Schengen Information System for security reasons.

  • Visa For Remote Working

The new visa applies to remote work carried out by people who work in Portugal (e.g. digital nomads), by employees or independent contractors, and for entities with residence or head offices outside our country.

Based on this new visa, these workers no longer must apply for other types of visas to start residence processes in Portugal.

With the new measures, they will be able to start the processes only with the new resumed work visa.

  • Possibility Of Complementary Professional Activity For Citizens With A Research, Study, Work Placement Or Volunteer Visa

Holders of a residence permit for research, study, professional traineeship, or volunteering will now be able to exercise a professional, subordinate, or independent activity, complementary to the activity that originated the visa.

Based on this new visa, these workers no longer must apply for other types of visas to start residence processes in Portugal.

With the new measures, they will be able to start the processes only with the new resumed work visa.

  • Possibility Of Complementary Professional Activity For Citizens With A Research, Study, Work Placement Or Volunteer Visa

Holders of a residence permit for research, study, professional traineeship, or volunteering will now be able to exercise a professional, subordinate, or independent activity, complementary to the activity that originated the visa.

  • Extending The Duration Of Residence Permits For Trainees

The trainees will now have residence permits valid for: (i) 6 months; (ii) the duration of the traineeship program, plus three months, if the program is shorter than six months; (iii) 2 years in the case of a long-term traineeship, in which case it may be renewed, once, for the remaining period of the traineeship.

The changes in question, which will certainly contribute to the labour shortage felt in the Portuguese economy, are already in force.

The rules implementing the 2022 State Budget were recently approved.

We’re analyzing labor measures in this article. The main ones are:

 

Salary and bonuses

  • State-owned companies must have instruments (e.g. collective labor agreements, legal or contractual instruments, or internal regulations approved under the State Business Sector Legal Framework) establishing mechanisms for: (i) performance assessment; (ii) performance awards; and (iii) general employee validation. The lawfulness of these acts depends on the prior existence of those instruments.
  • Promotions not covered by mandatory changes in remuneration, general career progressions, as well as internal selection procedures for change of level or tier that can result in a pay raise, not explicitly mentioned in a specific rule of the 2022 State Budget Law (LOE 2022), depend on special Government approvals.
  • Directors of the bodies and services can, in compliance with the legal requirements and budget sums, allow: (i) remuneration changes by management option; (ii) award performance bonuses.

 

New hirings

  • Public Administration and Finance Government members can open hiring procedures, for open-ended contracts or fixed-term contracts and for general or special careers, as long as: (i) there is relevant public interest in recruitment; (ii) a budgetary responsibility statement is issued by the requesting body, service or entity; and (iii) the Government member leading the service or body carrying out the recruitment agrees.
  • Legal persons under public law and public business sector companies can hire permanent workers.

 

Operating expenses of companies in the state's business sector

  • The operating expenses ratio must be equal to or lower than in 2019 or 2021, depending on which is higher.
  • In any case, operating expenses should be equal to or lower than in 2021 when it comes to: (i) staff; and (ii) travel, cost aid and accommodation, and the ones associated with contracting of studies, opinions, projects and consulting services.

Introduction

The new Portuguese Electronic Communications Law ("LCE"), published on August 16, 2022, transposes Directive (EU) 2018/1972, which informs the most recent recast of the sector's regulatory framework establishing the European Electronic Communications Code ("EECC").

In 2004, Portugal transposed the Review99’s Directives (of 2002) into a single act thus creating a national version of an electronic communications code, the transposition of EECC should have been an easy task. Interestingly, as the transposition deadline was practically expired before the pandemic outbreak, the cause of this delay seems to be mostly attributable to the sector's upheavals, such as the 5G auction technology implementation, rather than to COVID-19 lockdowns.

Although it broadly follows its predecessor, the newly enacted LCE is an entirely new piece of legislation, and, as such, some relevant changes were introduced, not only to accommodate all the new features of EECC, but also to reflect the new regulatory policy priorities.

Most of the relevant new features focus on issues regarding consumers vis-à-vis operators’ rights in general, privacy in electronic communications and a thorough overhaul of the sanctions’ framework. We highlight some of them below. 

 

Consumer rights

Regarding consumer protection rules introduced by the new law:

  • Retention period. According to the new paragraph 3 of article 131, the availability of installments with shorter retention periods (12 or 6 months) is no longer mandatory, however, there is a new maximum limit of 24 months.
  • Unavailability of service.  The law states that in case there are any reports of service unavailability lasting longer than 24 hours, the operator must credit the equivalent value. The return of this amount does not only apply when there are interruptions of more than 24 consecutive hours, but also to situations where the failures added together exceed this time, per billing period. However, for the consumer to be able to terminate the contract free of charge, a 15-day period of persistence of the problem is required (after the report).

Situations in which no early termination costs are charged.  The new LCE defined a few situations where early termination costs cannot be charged, such as unemployment (for reasons not attributable to the consumer), incapacity to work for more than 60 days with a loss of income or a change of address to a place where the operator cannot provide an equivalent service.

 

Electronic Communications Privacy

  • Amendment to the Law on Privacy in Electronic Communications. Regarding the Law on Privacy in Electronic Communications (Law no. 41/2004, of 18 August), Articles 7 and 10 are amended. Essentially, the amendments concern the increase of the number of organizations to which personal data regarding the location of emergency communications may be shared with, now covering not only the organizations legally entitled to receive such communications, but also those entitled to process them.
  • Itemized billing. Article 122, paragraph 5, of the new LCE provides that itemized bills do not have to identify free of charge calls, including calls to helplines.
  • Procurement avoidance. It is not clear in Article 126 whether, in the case of services provided to a company, the company that contracts the electronic communications services will be included in the database or if it will be the employees as actual users of the services.

 

Sanctioning framework

Article 176 and partially Article 164 of LCE outline a new and very broad sanctioning framework for electronic communications in Portugal. 

 

Some more details...

  • "Electronic communications service". The definition of "electronic communications service" was broadened and now includes a range of activities typically carried out by instant messaging applications, email, internet calls and personal messages through social media.
  • General consent.  A notifying duty is now imposed where companies intending to offer public electronic communications networks and publicly available electronic communications services must inform the National Regulatory Authority ("ARN") about the start of their activity.

CP, the Portuguese State-Owned Company responsible for the management of trains, concluded a new Company Agreement and respective Career Regulation with the Union, Sindicato Nacional dos Maquinistas dos Caminhos de Ferro Portugueses (SMAQ).

The Agreement is applicable to train drivers, represented by the Union SMAQ, and has already been published in the Bulletin of Labor and Employment.

In short, the new Company Agreement and respective Career Regulation introduce the following changes:

  • Salary increase, retroactive to 1 January 2022;
  • Removal of an index at the base for all driving career categories;
  • Addition of an index at the top for all driving career categories;
  • Creation of minimum tenure for index change, with a maximum of four years;
  • Elimination of overlapping indices between professional categories and their managers;
  • Integration of the Single Agent's Allowance in the retribution;
  • Increase of the meal allowance to €7.74;
  • Creation of an autonomous indicator scale for workers in the driving career;
  • Establishment of a telework regime, under the terms foreseen in the Labor Code, when functions allow it; and 
  • Automatic access to the Traction Assistant category.

The new Company Agreement contains a globally more favorable regime for the workers, and also covers workers who are members of SMAQ, as well as workers who are not members of a union that has signed it, within a period of three months, under the terms of the rules set out in the Company Agreement.

This new Company Agreement falls under the principle of collective autonomy and the right to collective bargaining, which are among workers' rights, freedoms and guarantees in Article 56, paragraph 3 of the Constitution of the Portuguese Republic.

2022-07-19
Guilherme Dray

Introduction

Labor Compliance does not limit itself to hard law, but also soft law, which does not arise from strict law and which, in an employment context, may address issues such as equality and non-discrimination, moral and sexual harassment, citizenship at work, etc. Generally, these recommended behaviors arise from codes of conduct, internal regulations and collective bargaining agreements.

Companies are obviously more skeptical when having to implement rules not imposed by law. However, this complementarity between what stems from hard law and what results from soft law is   essential to comply with labor legislation, to close any gaps in the relationship between employee and employer, and to promote good working environments and employee well-being.

We have witnessed the increasing of awareness of companies’ social, moral and environmental responsibility, within the concept of ESG (Environment, Social, and Governance), during the last decades, which has improved the enforcement of equality in the workplace as well as other issues related to citizenship rights, like harassment prevention and implementation of privacy policies and personal data protection.

With the implementation of compliance policies and with the companies ‘concern to promote the "common good", reputational effects are now immediate which causes companies to become more appealing in the labor market, building a good working environment that will undoubtedly lead to the hiring and holding of talent and an increase in productivity.

In practical terms, labor compliance has meant the implementation of codes of conduct against harassment, on gender equality policies, including the tackle on pay gaps, the creation of whistleblowing channels to protect whistleblowers against retaliations in the workplace, as well as the creation of codes of conduct and ethics and compliance programs to prevent money laundering and corruption.

The obligation to adopt these soft law instruments, in some cases, arises from labor legislation or some separate pieces of legislation. In other cases, these policies stem from collective bargaining agreements negotiated between companies and unions.

 

Digital labor compliance in Brazil

In Brazil, Law 12.846/13, known as the Anticorruption Law, regulated by Decree-Law 8.420/15, on the responsibility of legal entities for engaging in (harmful) acts against the public administration, highlights the importance of the adoption of an adequate Compliance program for Brazilian companies and the enforcement of an effective corporate governance system capable of implementing a culture of prevention and strengthening of transparency and ethics.

The Integrity Program, created by Decree-Law no. 8.420/15 in its chapter IV, article 41, by providing a set of procedures and integrity tools to be applied internally in companies to fight corruption, brought to the Brazilian legal system the first indications of the need to adopt a true Compliance program.

In this sense, Law no. 12.846/13 boosted the adoption of mechanisms inherent to Compliance by organizations, establishing the decrease of sanctions for companies that prove their cooperation in the investigation and analysis of violations, including the application of internal procedures of integrity and audit. The Law also encouraged the implementation of whistleblowing channels and codes of ethics, according to items VII and VIII, of article 7, tools common to the Compliance program.

 

Main norms and instruments of digital labor compliance programs, while highlithing the LGPD

To ensure the permanence of data and activities within the legal dictates, Compliance was accentuated in the digital environment with the entry into force of the General Law of Data Protection (LGPD), Law no. 13.709/2018, which came to show how important it was to adopt specific (and effective) mechanisms in integrity programs.

The scope of the incidence of LGPD entails the adaptation not only of the sectors related to the gathering of information, but also of the other operations that require the use of data related or relatable to natural persons, having repercussions, also and therefore, on labor relations.

In Brazil, privacy and intimacy are fundamental rights (art. 5, LXXIX, of CF/88), but unlike the GDPR (General Data Protection Regulation of the European Union), LGPD does not expressly mention its applicability to employment relationships, which is indisputable. Employment relationships could not even begin and develop without the processing of personal data collected at various stages of the employment contract of workers or job applicants. The legal gap pointed out allows the Brazilian legal system to be open to comparative law (art. 8 of CLT) and in contrast with the apparent lack of protection, international standards can be used in Brazilian labor relations.

Digital labor compliance plays a fundamental role, making it necessary to review conduct standards established for compliance with other norms, in order to avoid, for example, the collection of expendable data or data which processing may be considered discriminatory.

 

Privacy by Design e Privacy by Default methods

GDPR introduced us to two new concepts, Privacy by Design and Privacy by Default. LGPD does not explicitly mention those concepts, but has adopted similar ones, when describing the measures that companies must implement to protect data, especially in article 46/2.

Privacy by Design means ensuring data protection from the beginning and can be better understood by looking at its seven informing principles. They are: (i) proactive rather than reactive, preventive rather than corrective; (ii) privacy by design; (iii) full functionality; (iv) end-to-end security; (v) visibility and transparency; (vi) respect for user privacy; and (vii) privacy by default.

One could say that Privacy by Default is an extension of Privacy by Design. The idea of Privacy by Default is that privacy should always be the default setting in any system or even business practice, and that the user should release access to collect more information if preferred, so that applications would collect only necessary information. In other words, the user's decision should always be respected (right to informational self-determination), since the data is the user’s property.

The methods described above allow a beginning of a project already compliant to LGPD, reducing costs with later adaptation to the law.

 

Possibility of introducing digital labor compliance clauses applicable to employment contracts

LGPD introduced the role of Data Protection Officer – (DPO) in Brazil, a person who acts as a communication channel between the institution, the data subjects and the National Data Protection Authority (ANPD). However, the legislator has preferred to be more flexible regarding the DPO when compared to other legislation, like, for example, the GDPR.

When it comes to data compliance in the workplace, there is no single implementation model to be followed, but there are three pillars that help: prevention, recognition and correction.

Prevention is considered the most important cornerstone, and it is up to the employer to invest most of their resources to ensure the security of their workers' information. The second cornerstone, recognition, is related to the existence of reporting channels as a form of control within the work environment. The correction cornerstone, on the other hand, establishes that any occurring breach must be immediately corrected.

The presumption of unevenness in employer-employee relationships is well known, making it unlikely for consent to be the sole and exclusive legal basis for workplace data processing, unless employees can withdraw it at any time and without adverse consequences, according to Opinion no. 2/2017 on data processing at the workplace, article 29 for data protection (employment group). Performance of a contract and legitimate interest can sometimes be invoked as reasons for data processing in employment relationships, provided that the processing is strictly necessary for a legitimate purpose and respects the proportionality and subsidiarity principles.

It should be noted that small businesses receive differentiated treatment, but are not exempt from complying with the provisions of the legislation at stake. The easing of the legislation for small businesses, in summary, refers to the simplification of data processing and the communication of security incidents (communication that can be made from the model made available by the National Data Protection Authority itself - according to Resolution CD/ANPD no. 2, January 27, 2022, which regulates the application of LGPD for small treatment agents).

 

Portugal - 

Digital compliance and data protection

"Compliance" is the mechanism used to achieve compliance (conformity) and to be compliant, so it can be both a means (to achieve compliance) and an end in itself (to be compliant).

Compliance can be legal, technological, administrative, among others, and is transversal to any organization, regardless of its public or private nature, area of activity and even size.

The compliance procedure, when directed to the cyberspace and digital environment, is nothing more or less than what we call digital compliance. In other words, the adoption of a set of rules, processes and procedures by companies to protect their data, which is one of their most valuable/ strategic assets.

For this reason, it is fundamental to integrate digital compliance into the business strategy of organizations. Any business activity necessarily implies processing operations of personal and non-personal data, which must be done in compliance with European and national legislation.

Regarding protection of non-personal data, the European Parliament adopted Regulation no. 2018/1807 of November 14, 2018, which was intended to promote the free movement of non-personal electronic data in the European Union. As opposed to "personal data," non-personal data is information that does not directly relate to an identified or identifiable natural person (individual). Examples of non-personal data are aggregated and anonymous data sets used for big data analysis, in the current context of the strong expansion of the "internet of things", artificial intelligence, autonomous systems and 5G.

Regarding personal data protection, it is applied in Portugal the EU Regulation no. 2016/679 of April 27, 2016, which approved the GDPR and the Law no. 58/2019 of August 8, that ensures the enforcement of GDPR in Portugal.

Portuguese law, moreover, contains provisions on the protection of personal data specifically applicable to employment, including rules on the use of biometric data and on the means of remote surveillance, which are regulated.

To enable the implementation of these laws and regulations, international standards norms are created and modified, creating a correspondence between technical and legal norms.

ISO 27001 norm is one example.

The norm intends to enable public and private organizational environments to meet the data protection standards required by the GDPR, while seeking to summarize the union between the law, the information security and management and the information technology, which represents an evidence of digital Compliance.

In Portugal, with the pandemic scenario experienced recently, cyber-attacks have become more frequent, motivated by the exponential growth in Internet traffic and the adoption of telecommuting.

Given this, and in addition to the concern of complying with the legislation on data protection, digital compliance has been an increasing concern for companies, which seek to protect themselves, their employees, customers, suppliers and all those who interact with the company.

 

Portuguese anti-corruption strategy 2020-2024 (MENAC)

In Portugal, many measures have been taken to prevent and repress corruption and fraud in recent years.

However, the realization that only a long term vision, bringing together efforts and generating dynamics within the different powers of the State, the different areas of governance and the private and social sectors, would be able to confront the phenomenon of corruption, determined the need to design a National Anti-Corruption Strategy 2024 ("Strategy"), which enshrined as a priority the prevention and detection of "corruption risks in the public sector, through, among other measures, the adoption of Regulatory Compliance Programs in the Public Sector, based on the experience of the private sector" (Priority 2), as well as the need to "Engage the private sector in the prevention, detection and repression of corruption" (Priority 3).

Based on these priorities, some pieces of legislation were passed, namely, Decree-Law no. 109-E/2021, of December 9, which created the National Anti-Corruption Mechanism (MENAC) and the General Regime for the Prevention of Corruption (RGPC).

MENAC assumes the nature of an independent administrative entity, whose mission is to promote transparency and integrity in public action and to ensure the effectiveness of policies to prevent corruption and related offences.

MENAC holds powers of initiative, control and sanction, and is responsible, in particular, for: (i) developing, along with the Government, programs and initiatives for the creation of a culture of integrity and transparency, covering all areas of public management and all stages of education; (ii) developing campaigns for the prevention of corruption; (iii) collecting and organizing information on the prevention and repression of corruption and related crimes; (iv) issuing guidelines and directives for the design and terms of execution of regulatory compliance programs; (v) evaluating the application of RGPC; (vi) monitoring compliance with the norms set forth in RGPC.

In short: the creation of MENAC, stemming from the Strategy, intends to prevent and detect corruption risks in the public sector, and to engage the private sector in the prevention, detection, and repression of corruption.

 

The future of work and the right to privacy

With the increasing use of new technologies such as artificial intelligence, the so-called "Internet of Things" (IoT) and big data analysis, concerns about privacy, data protection and digital risks have increased significantly.

The digital revolution and its impacts on the labor market are likely to create risks to privacy and the protection of personal data, particularly in teleworking and remote working, as well as on digital platforms.

In fact, the new information and communication technologies place new means of surveillance of work activity at the employer's disposal, allowing more intrusive and permanent control, as well as almost unlimited processing of personal data.

This reality highlights the importance of protecting the right to privacy and the protection of personal data.

In Portugal, the Constitution of the Portuguese Republic provides for the right to privacy (Article 26) and the right to the protection of personal data (Article 35).

At the European level, the protection of privacy results from the European Convention on Human Rights (Article 7) and the Charter of Fundamental Rights of the European Union (Article 8).

The protection of personal data, in turn, results from the GDPR, which contains a specific rule regarding data processing in employment (article 88), as well as from Law no. 58/2019, which provides for specific situations of personal data processing, particularly in the context of employment relationships (article 28).

On a strictly labor level, it is also important to take into account articles 14 to 22 of the Labor Code, which include the right to privacy (article 16) and the protection of personal data (article 17).

Taking into account, in any case, the increased risks arising from the increment and massification of new technologies, the Green Paper on the Future of Work, approved by the Portuguese Government in 2021, established new recommendations regarding privacy in the workplace, namely:

–      Prevent and strictly regulate the practice of employment background checks, preventing the evaluation of the job applicant's profile and professional curriculum from being made using personal data of the applicant that have no direct connection with the type of activity for which he/she is applying and that interfere with his/her personal or intimate sphere;

–      Prevent the use of tools that allow monitoring e-mails, websites visited, the amount of messages sent and calls/meetings held, originating a significant risk of remote surveillance of workers in real time, as well as enabling the creation of behavioral profiles.

The Future of Work is all about protecting the privacy and personal data of all parties involved, in particular workers.

 

Conclusion

In conclusion, to ensure the effectiveness of a Compliance program, it is essential to assess the risks involved and re-evaluate them continuously, since business is also in constant transformation, as well as technology, in order to prevent or mitigate damages resulting from the misuse or abuse of employee data.

In Brazil, regarding digital labor compliance, it appears that, although LGPD does not expressly establish provisions applicable to labor relations, the treatment of personal data is fundamental in the various stages of the employment contract, revealing itself, therefore, as a delicate area for its implementation and effective compliance. It can even be seen as an opportunity for the Brazilian legal system to open itself up to comparative law, namely, to the GDPR.

In Portugal, GDPR and national law that ensures its enforcement (Law 58/2019) have specific provisions for the employment context, which apply alongside the Labor Code, and whose compliance is indispensable to the implementation of a Compliance program.

Stakeholders have demanded parity of care in data handling, since liability for damages resulting from incidents is joint and several, and moreover, compliance with data subjects' data is a corporate value and strategic asset of organizations. 

It is important that professionals in the labor area pay special attention to the obligations imposed by legislation and prepare to adapt their work routines/practices to data protection requirements, mainly through a risk management system to be integrated into an efficient digital Compliance program in the labor context.

Proposed Law no. 79/XXIII/2022, which amends the Labor Code, has been approved.

The Proposal, containing several measures, will be discussed and voted on in Parliament.

The main changes are:

 

Definition of "economic dependency”

There is “economic dependency" when the work provider is a natural person who performs an activity for the same beneficiary directly and without the intervention of a third party and obtains more than 50% of the output of that activity from the beneficiary in a calendar year (article 10/2).

 

Collective rights for the economically dependent

The economically dependent are now entitled to: (i) representation of their socio-professional interests by trade union associations and by workers' committees, even if they cannot be members; (ii) negotiation of collective labor regulation instruments, specific to the self-employed, through trade union associations; (iii) application of existing negotiated collective labor regulation instruments applicable to workers (10-A).

 

Digital platforms - presumption of employment

There is a new presumption of employment for work performed on digital platforms when certain requirements are met: the remuneration is fixed by the platform operator; the operator directs the form of action and presentation of the provider; the operator controls the activity provided, namely through electronic means; the operator restricts the autonomy of the provider with regard to the organization of the work, in particular the choice of working hours or periods of absence, the possibility of accepting or refusing tasks, the use of subcontractors or substitutes or through the application of penalties for the beneficiary operating on the platform; it restricts the possibility of choosing clients or providing activity to third parties via the platform; the work equipment and tools used belong to the digital platform operator. Presumption may be rebutted by the platform operator (Article 12-A).

There was a reinforcement of the accessory sanction for "false" service provision contracts, determining, in case of relapse: (i) the deprivation of the right to support, subsidies or benefits granted by a public entity or service, or from European funds; and (ii) the deprivation of the right to participate in public tenders or public procurement (12/3).

 

Algorithms and Artificial Intelligence

On the use of algorithms, artificial intelligence and related matters, collective bargaining agreements cannot exclude legal provisions unless they are are more favorable to workers (3/3).

Equality and non-discrimination also apply in the case of decision making based on algorithms or other artificial intelligence systems (24/3).

 

Broadening of the concept of “discriminatory behaviors”

Discrimination in pay related to the attribution of attendance and productivity bonuses, as well as unfavorable allocations in terms of evaluation and career progress (25/6 and 7) are considered to be “discriminatory behaviors”.

 

Adoption and foster care leave

Adoption processes and foster families are considered as justified absences from work that do not entail the loss of any rights and are considered as effective work, except for remuneration (65/1, k)).

 

Duty to inform the employee

The employer must now inform the employee about new aspects: (i) identification of the user, for temporary workers; (ii) right to continuous training; (iii) in the case of intermittent work, the information provided for in the legally established framework; (iv) parameters, rules and instructions on which the algorithms or other artificial intelligence systems are based (106/3).

 

Trial period

180-day trial period applicable to workers with a permanent contract who are looking for their first job and the long-term unemployed is reduced and/or excluded depending on whether the duration of the previous fixed-term employment contract, with a different employer, was 90 days or more (112/5).

The possibility of reducing the trial period according to whether the duration of the professional internship with positive evaluation, for the same activity and different employer, was equal to or greater than 90 days, in the last 12 months, was established (112/6).

The notice period for terminating the contract during the trial period, after more than 120 days, is now 30 days (114.º/3).

Duty to communicate to CITE (Commission for Equality in Employment) the termination of the contract during the probationary period extends to the caregiver worker (114/5).

It is mandatory to communicate to ACT (Authority for Working Conditions) the termination of the contract during the trial period applicable to open-ended contracts of first-time job seekers and long-term unemployed, within 15 days (114/6).

The new rules now state that although the termination does not depend on just cause, it cannot be abusive, according with article 334 of the Civil Code (114/7).

 

Fixed-term contracts

Rules on the succession of fixed-term contracts were strengthened to prevent abuse of this form of contracting, namely by preventing the new admission or assignment of a worker under a contract (fixed-term, temporary or service provision) which is executed in the same job, for the same purpose or the same professional activity (143/1).

The obligation to communicate to CITE, with a minimum of five working days' notice, of the reason for non-renewal of a fixed-term employment contract, extends to the care worker (144/3).

Compensation for termination of a fixed-term employment contract (fixed or uncertain) was extended to 24 days per year (344/2).

 

Temporary work

If the maximum duration of a contract for the use of temporary work has been reached, the succession in the same job of a temporary worker or of a worker employed for a fixed term, concluded with the same employer or company that has a group or control relationship with it, or maintains common organizational structures, is forbidden before a period equal to one third of the duration of the contract has elapsed, including renewals (179/1).

If a user contract is signed or renewed with an unlicensed temporary work company (ETT), the integration is done with an open-ended contract in the user company (180/5).

The duration of successive temporary work contracts in different users, concluded with the same employer or company that is in a dominating or group relationship with it, or maintains common organizational structures, may not exceed four years. Once this limit is exceeded, the contract is converted into an open-ended employment contract for temporary assignment (180/4 and 5).

 

Collective labor relations and collective bargaining

Trade union activity is allowed in the company even when there are no unionized workers, subject to specific applicable conditions and as long as the normal functioning of the productive activity of the company is not affected (460/2).

The choice of collective agreement is not possible if the worker is already covered by an extension decree (497/5) and the issuing of the extension decree rules out the application of an agreement that may have been chosen (515/5).

In the event of termination of a collective agreement, the party to which it is addressed may request arbitration by the President of the Economic and Social Council for review of the grounds for the termination, which suspends its effects, preventing the agreement from coming into force (500-A).

2022-06-08
Guilherme Dray

Introduction

The advancement of technologies and the adoption of globalized and shared economic models have created new forms of provision of work, which is a challenge, regulation-wise.

Work performed on digital platforms is one of these new realities. It is characterized by the decentralization of activities and people, algorithmic management of work, and flexibility in labor relations. As a rule, it involves three parties: the platform provider, the supplier, and the claimant.

Facing these new work models, based on information and communication technologies and the use of digital platforms, the Law is trying to give new answers to regulate this new way of working.

The Green Paper on the Future of Work, which was prepared by the Portuguese Government and published in March 2022, is an example of how these concerns are gaining the attention of policy makers.

In this newsletter, specialists from MACEDO VITORINO (Lisbon, Portugal) and DENISE FINCATO (Porto Alegre, Brazil) briefly present recent legislative initiatives and court decisions regarding the regulation and framework of work performed on digital platforms, under a comparative perspective, involving the legal systems of Portugal, Brazil and Italy.


EU Directive Proposal

A Proposal for a Directive regulating the working conditions of digital platform workers and clarifying the status of these workers was long overdue. That Proposal arrived on December 9, 2021 and is now to be negotiated between the Council (Member-States) and the European Parliament. If approved, it should be transposed within 2 years at the latest.

The Directive creates a list of control criteria to determine whether the platform is (or is not) an employer, and, if at least 2 criteria are met, the platform is legally presumed to be an employer. The criteria that should be taken into account are the following: (i) supervision of work performance by the platform; (ii) restriction of freedom of choice of working hours and/or
periods of absence; (iii) obstacles to performing work for third parties; (iv) imposition of conduct rules and appearance; and (v) fixing remuneration levels (article 4). Under Article 5 of the Proposal, the platform can rebut the legal presumption of employment, and it is up to the platform to prove that there is no employment relationship.

The Proposal intends to increase transparency in the use of algorithms by platforms as well, ensuring human monitoring and the right to challenge automated decisions (article 6).

In addition, the Proposal strengthens the powers of the inspection authorities and obliges platforms to comply with a set of information duties regarding the way work is provided, the number of employees and the contractual conditions applicable (articles 11 and 12).

Finally, article 18 establishes the protection of platform workers against unlawful dismissal. With this, we can say that we will soon have a Europe fully prepared for the Digital Age.


Portugal

Recently the Portuguese Government, in the scope of the "Righteous Work Agenda", approved a bill that amends the Labor Code and that meets the provisions of the above-mentioned Directive Proposal, i.e., creates a presumption of employment relationship for work developed in digital platforms (article 12-A).

The presumption is based on the existence of a set of indicators, which include: (i) the digital platform operator sets the remuneration for the work performed on the digital platform or sets maximum and minimum limits for the remuneration; (ii) the digital platform operator processes the payment between the users and the activity provider of the platforms; (iii) the activity provider does not act in their own name, but provides its activity within the digital platform operator's organization; (iv) the communication between the users and the activity provider is carried out and managed by the digital platform operator; (v) the digital platform operator monitors the quality of the results achieved by the activity provider by providing its users with an assessment or rating of the activity; (vi) the digital platform operator monitors in real time the activity performed by the activity provider, including through a continuous geolocation system and algorithmic management; (vii) the digital platform operator exercises powers over the activity provider, including disciplinary powers, and may exclude the activity provider from future activities by deactivating the account when its assessment is considered insufficient. The presumption may be rebutted by the platform operator.

The proposed law, which has not yet been approved, does not cover special regimes that have their own rules already, as such as TVDE, which maintains, for example, the “operator”, who limits the recognition of the employment relationship between drivers and platforms.

In Portugal, Law no. 45/2018, of August 10, provides the legal regime for the activity of paid individual transport of passengers in unmarked vehicles from an electronic platform. Innovatively, the Portuguese law introduced a fourth actor in the process. In addition to the electronic platform, the driver and the passenger, there is the TVDE operator, which is the one who provides the remunerated passenger service and, in turn, concludes the contract with the drivers.

This law put an end to the "regulatory void" existing in the Portuguese legal system, establishing a set of requirements for the exercise of the economic activities in question. The start of business, both of TVDE operator and the platform operator, are subject to licensing by IMT, Institute of Mobility and Transport.

When it comes to drivers, the law defines a mandatory pre-qualification system, which includes a written contract that regulates their relationship with the TVDE operator, to which the presumption of employment contract in article 12 of the Labor Code applies.


Brazil

In Brazil, there is no specific norm regulating work relations in digital platforms. There are several bills in progress, some establishing and others excluding the presumption of employment relationship (according to articles 2 and 3 of the Brazilian Consolidation of Labor Laws - CLT), which can be described by four essential elements: subordination, personal nature, habituality and rewarding.

The recognition of the employment relationship involving the recent hiring models between app drivers and technology platform provider companies is still a new theme in the Brazilian Superior Labor Court (TST). Although some "Classes" of TST have already issued decisions recognizing the employment relationship between the driver and Uber, others have issued decisions in a different sense, showing that there is no consolidated understanding on the subject in the Brazilian Labor Court.

During the COVID-19 pandemic in 2020, digital platform service providers in the country organized the "Breque dos Apps" (Break of the Apps), a kind of national strike of service providers, which included organized groups in several cities in Brazil. The protests were attended by service providers who shut down their apps for a few hours. Among the demands that guided this mobilization were the increase in the minimum amount per trip, the request for benefits such as meal vouchers and insurance (life, accident, and theft insurance), the end of application blocking and the provision of protective equipment against the COVID-19 virus, such as masks and alcohol-gel.

In January 2022, Law No. 14/297, which regulates specifically the protection of people who provide service through digital platforms during a pre-fixed period qualified as a "public health emergency state" was passed. Among the measures, the law provides that platforms must have accident insurance plus worker compensation, as well as an obligation for service providers diagnosed with Covid-19 to receive financial assistance from the platform for an initial period of 15 days. If companies fail to comply with protection rules there can be sanctions ranging from warnings to the payment of fines.

On April 22, 2022, the Brazilian Ministry of Health published an ordinance declaring the end of the Public Health Emergency State of National Importance (Espin). This ordinance will directly affect some labor rules that were temporarily modified due to the exceptional situation faced in the last two years. Among them are obligations imposed on companies and workers' rights that have been made more flexible and, in this same sense, the termination of Law no. 14/297-22.

The challenge of regulating platform work lies in finding a balance: on the one hand, it is important to protect those who perform their work activity through telematic means; on the other hand, it is important to stimulate companies that, based on free initiative and technological advance, seek to develop their activity based on digitalization.

The Brazilian scenario still presents itself as legally insecure in the face of the development of labor relations in platforms, either due to the inexistence of specific legislation or due to jurisprudential divergence, a fact that generates legal insecurity for workers in the new economy.


Italy

In 2015, Tribunale di Milano ruled on a dispute between several entities representing the taxi drivers' category and UBER POP (procedure no. 16612). Considering that the service provided through Uber's digital platform grants the possibility, to those who do not have a cab driver's license, to perform a paid transportation service, using the company's application (which acts as an intermediary between drivers and customers), the Court of Milan considered that UBER POP's activity was a case of unfair competition, according to art. 2598 no. 3 of the Italian Civil Code.

Codice Civile, in the third paragraph of art. 2598, establishes that whoever makes use, directly or indirectly, of any means that do not comply with the principles of professional suitability and that can cause damage to a company belonging to another, is practicing acts of unfair competition.
On the other hand, article 82 of the Italian Highway Code defines the limits of the use of the vehicle in favor of third parties, sanctioning the prohibition to use the vehicle for purposes other than those indicated in the registration documents.

Recently, Decree-Law no. 143 of December 29, 2018, which regulates, in addition to the cab sector, noleggio con conducente (NCC), created new rules for the non-regular public transport system, such as the fact that NCC are required to return to headquarters after each trip. Unlike cabs, which stop in specially marked public areas, NCC can operate throughout the country, without having marked parking areas.

The law, however, did not regulate Uber at all and, nor, in general, digital platform work.

This provision will now be up to the legislator, who will have to consider the very recent EU directive.

2022-05-09

On 6 May 2022, the Portuguese Government enacted Decree-Law 31/2022, which regulates covered bonds issued by Portuguese credit institutions (New Covered Bonds Law) and replaces the old covered bonds law, approved by Decree-Law 59/2006, of 20 March 2006. The New Covered Bonds Law implements Directive (EU) 2019/2162 and Directive (EU) 2021/2261.

Without bringing significant changes, the New Covered Bonds Law simplifies the mortgage-backed bonds and public sector debt backed bonds and establishes a single type of bond independent of the cover asset.

Eligible cover assets include:

  • Assets that fulfil the requirements set out in the European Union legislation on prudential requirements applicable to credit institutions for exposures in the form of covered bonds;
  • Credits granted to public undertakings which do not meet the above requirements; or
  • Other high-quality cover assets which are secured by first ranking security over assets located or registered in the European Economic Area.

Holders of covered bonds and counterparties of derivative contracts hold preferential rights which are secured by cover assets in case of insolvency of the credit institution.

In line with the Directive, bonds should have a cover pool liquidity buffer to cover the maximum cumulative net liquidity outflow over the next 180 days.

Covered bonds programs are subject to prior authorization by the Portuguese Securities Market Commission (Comissão de Mercado de Valores Mobiliários - CMVM), which has 90 days to review the application.

To ensure the authorization, the issuer must have:

  • An appropriate operational program that defines the issuance procedure;
  • Appropriate policies, processes, and methodologies for the protection of investors in the context of the approval of the loans included as cover assets; and
  • An administration and monitoring structure to ensure that the cover assets comply with the applicable requirements.

The New Covered Bonds Law will enter into force on 1 July 2022 and is expected to make the financing of credit institutions more flexible and allow the issue of bonds which will qualify as European covered bonds.