Government to revive labour law reform talks before summer break

Portugal’s minority government is expected to relaunch negotiations on controversial labour law reforms before parliament breaks for the summer, despite the legislation being rejected earlier this month, according to an exclusive report by Expresso.

Although today’s meeting of the Standing Committee for Social Concertation (CPCS) officially focuses on monitoring the implementation of the 2025–2028 Tripartite Agreement on Wage Growth and Economic Development, Expresso reports that Labour Minister Rosário Palma Ramalho is expected to use the gathering to signal the restart of talks on reforming the Labour Code.

The proposed overhaul was voted down in parliament, but the minister made clear immediately afterwards that the government intends to continue pursuing changes.

According to Expresso, Palma Ramalho has since held discussions with employers’ organisations on how to revive the reform, although no formal strategy has yet been announced.

The newspaper says employers’ confederations are pressing for negotiations to resume quickly, arguing that labour market reform remains urgent. Trade unions, however, insist there is no basis for reopening discussions after parliament rejected the government’s proposal.

One option under consideration, Expresso reports, is for the government to break up the reform package and submit individual measures to parliament rather than attempting to pass a comprehensive overhaul.

Among the proposals that could return are easing restrictions on outsourcing by companies that have made recent redundancies, expanding the use and duration of fixed-term employment contracts, reintroducing individual “time bank” working arrangements, and extending parental leave provisions.

If the government follows that route, the measures are expected to be presented after the summer recess, when parliament will also be preparing to debate the AD coalition government’s 2027 State Budget.

While the labour reform does not appear explicitly on today’s agenda, Expresso says it is likely to dominate discussions under the meeting’s catch-all item covering “other matters”, making it the political “elephant in the room” as the government seeks to revive one of its most contentious legislative projects.

source material: Expresso

Natasha Donn

Journalist for the Portugal Resident.