The Legislative Assembly (AL) yesterday passed the outline of a government-initiated bill proposing to raise the maximum amount of compensation that an employee in the private sector will be entitled to receive after he or she has been dismissed without justification from the current 252,000 patacas to 258,000 patacas.
The bill proposes amendments to the Labour Relations Law.
Secretary for Economy and Finance Lei Wai Nong introduced the outline of the bill during a plenary session in the legislature’s hemicycle yesterday.
After yesterday’s passage of its outline, the bill will be passed to one of the legislature’s standing committees for an article-by-article review, after which it will be resubmitted to another plenary session for its second and final debate and article-by-article vote.
The Labour Relations Law lays out calculation rules for the amounts of compensation an employer is required to pay his or her employee who has been dismissed without justification, such as laying off workers.
According to the law, the compensation amount depends on the length of time the employee has been working for the employer before his or her employment is terminated.
For example, according to the law, an employer is required to pay a dismissed employee who had worked for over five years and up to seven years a compensation equivalent to the number of years of employment multiplied by his or her 15-day salary, while an employer is required to pay those who had worked for over 10 years a compensation equivalent to the number of years of employment multiplied by his or her 20-day salary.
According to the law, a dismissed employee who had worked for up to one year is entitled to a compensation equivalent to his or her seven-day salary provided that he or she completed his or her probation period.
However, according to the law’s current version, the amount of a dismissed employee’s monthly salary used to calculate his or her compensation is capped at 21,000 patacas, regardless of the amount of his or her monthly salary before his or her termination.
According to the law’s current version, a dismissed employee is only entitled to a compensation of up to 252,000 patacas regardless of the length of years he or she had worked for the employer, i.e., 12 times 21,000 patacas.
The bill, the outline of which was passed by yesterday’s plenary session, proposes to raise the maximum amount of a dismissed employee’s monthly salary used to calculate his or her compensation by 500 patacas, from the current 21,000 patacas to 21,500 patacas.
Correspondingly, the maximum amount of compensation that an employee is entitled to receive will increase to 258,000 patacas from the current 252,000 patacas – if the legislature passes the bill in its final reading.
According to the law, the government is required to review the compensation amount every two years.
The government decided not to change the amount after the previous review a few years ago.
Secretary for Economy and Finance Lei Wai Nong speaks during yesterday’s plenary session in the legislature’s hemicycle. – Photo: GCS
