Occasional secondment in Portugal: loaned within the group

Has your company in Portugal asked to "lend" you to another company of the group for a few months? That has a name in the Labour Code: occasional secondment (cedencia ocasional). The short answer: it is only lawful if four conditions are met at the same time, including your consent, and with a written agreement. If any of them fails, you gain a rare right: you can choose to stay permanently with the company you were sent to (Articles 288 to 293 of the Labour Code).

What occasional secondment is (and what it is not)

Pedro is a maintenance technician at a packaging company in Leiria. The group has a second factory, owned by another company of the same owner, that lost its technician. The board proposes: Pedro goes to work there for eight months. Pedro's contract does not move to the other company. He stays contracted to the first one, but starts taking orders from the second.

That is exactly what Article 288 of the Labour Code defines: occasional secondment is the temporary availability of a worker, by the employer, to work for another entity, under whose power of direction (who organises and commands the work) the worker is placed, while the initial contractual link stays in place.

The law gives the three protagonists their own names:

• Lender (cedente): your employer, the one who "lends" you;
• Host (cessionario): the entity where you go to work, the one who "receives" you;
• Seconded worker: you.

Do not confuse this with temporary agency work: there, the one assigning you is a licensed temp agency whose whole business is exactly that. In occasional secondment, your employer is a normal company that lends you occasionally within the group. The rules are different, and tighter.

Only lawful with four conditions, all at the same time

Article 289(1) of the Labour Code requires these four conditions to be met cumulatively (all together; if one fails, the secondment is unlawful):

a) Permanent contract. Only workers bound to the lender by a permanent contract can be seconded. A worker on a fixed term contract cannot.

b) Companies of the same universe. The secondment must happen between affiliated companies (in a corporate relationship of reciprocal holdings, control or group, meaning companies linked by capital or control) or between employers with common organisational structures. Lending a worker to a client or a supplier with no corporate relationship does not qualify.

c) Your consent. Without your agreement, there is no secondment. And this condition is shielded: Article 289(2) allows a collective agreement to regulate the conditions of the secondment, except this one. No collective instrument can second you against your will.

d) Limited duration. A maximum of 1 year, renewable for equal periods up to a limit of 5 years.

Breaching Article 289(1) is a serious administrative offence for the employer (Article 289(3)). And for you it opens the door of Article 292, which we cover below.

The written agreement: five mentions and a guaranteed return ticket

The secondment depends on a written agreement between lender and host (Article 290(1)), with this content:

• Identification, signatures and address or registered office of the parties;
• Identification of the seconded worker;
• Indication of the activity the worker will perform;
• Start date and duration of the secondment;
• The worker's declaration of consent.

Note that your consent goes into the document itself. A "yes" at the canteen door is not enough: the law wants your written declaration inside the agreement.

Article 290(2) is your return ticket: when the agreement ends, the host is wound up or the activity you were seconded for ceases, you return to the lender's service, keeping the rights you had before, and the seconded time counts towards seniority. Eight months on loan are eight months of house seniority.

The fines follow the weight of each piece (Article 290(3)): a missing declaration of consent, or refusing your return, is a serious administrative offence; missing any of the other mentions of the agreement is a light one.

During the secondment: their rules, the best salary of the two

While seconded, the host's working regime applies to you regarding how, where and when you work, contract suspension, health and safety at work and access to social facilities (canteen, transport, company benefits) (Article 291(1)). It is the host who draws up your work schedule and books the holidays you take while in its service (Article 291(4)).

On safety, the law tightens up: the host must inform you, and the lender, of the risks of the job (Article 291(2)), and it is forbidden to place you in a particularly dangerous post, unless it matches your specific professional qualification (Article 291(3)).

On pay, the rule plays in your favour. Your minimum pay during the secondment is the highest of three references (Article 291(5)):

1. The pay set in a collective agreement applicable to the lender or to the host for your duties;
2. The pay the host gives for the same duties;
3. The pay you earned at the moment of the secondment.

Pedro earns 1,150 euros at his home company. At the factory he was seconded to, maintenance technicians with the same duties earn 1,300 euros. During the secondment, Pedro is entitled to 1,300 euros. [Common interpretation:] the higher pay lasts while the secondment lasts; on return, Article 290(2) restores the rights you had before.

You are also entitled to holidays, holiday and Christmas allowances and other regular periodic benefits that the host's workers receive for identical work, in proportion to the duration of the secondment (Article 291(5)). Breaching any of these rules, risk information, dangerous posts, schedule and holidays, or pay, is a serious administrative offence (Article 291(7)).

And who can discipline or dismiss you? The law places you under the host's power of direction (Article 288). [Common interpretation:] disciplinary power stays with the lender, because that is where your contractual link remains.

Unlawful secondment? You can choose to stay

This is the strongest right of the regime. If the secondment happens outside the conditions of Article 289, or if the written agreement of Article 290(1) is missing, Article 292 gives you the option of staying in the host's service on a permanent contract.

How to exercise it (Article 292(2)):

• Up to the end of the secondment, so do not let the deadline pass;
• By registered letter with acknowledgment of receipt, addressed to both the lender and the host.

Carla has a fixed term contract at a group company and was "lent" to the parent company for a year. Condition a) of Article 289 fails from the start: only workers with a permanent contract can be seconded. Carla can send the two registered letters before the end of the secondment and become permanent at the parent company.

Six situations, six consequences

Secondment, temporary agency work and transfer of business: three different things

In practice they get mixed up, but the law keeps them apart:

• In temporary agency work, you are hired by a licensed temp agency whose business is assigning workers to clients. You have your own contract (fixed term or open ended for assignment) and your own rules (Articles 172 and following).
• In a transfer of business, your contract changes employer for good: the company (or part of it) was sold or transferred, and the buyer inherits the employer's position.
• In occasional secondment, the link stays with the lender and the loan is temporary, within the group, with your consent and a return date.

If you are told "you are moving to another company", always ask which of the three figures it is. Your rights change a lot depending on the answer.

For companies: keep the secondment inside the four lines

If you want to second a worker to another company of the group, first confirm the four cumulative conditions of Article 289(1), in particular the permanent contract and the corporate relationship. Put the agreement in writing with the five mentions of Article 290(1), including the worker's declaration of consent inside the document. On the host's side: notify the works council of the start of the use of a seconded worker within five working days (Article 293(2), the failure is a light administrative offence), inform the worker and the lender of the risks of the post, and pay the highest pay reference of Article 291(5), since the breach is a serious offence. Note also that the seconded worker does not count towards the host's headcount thresholds, except for the organisation of health and safety services (Article 293(1)). The biggest risk of getting it wrong: the worker can opt to become permanent at the host (Article 292), and the "cheap loan" turns into a definitive hire.

For unusual setups, such as international groups, chained secondments or doubts about the corporate relationship, checking with a lawyer or filing a complaint with ACT is the way to go.

General information, not legal advice. Always confirm amounts and deadlines with the official sources.