Unpaid Leave in Portugal: Rules, Notice, and What Changes in Your Contract

What unpaid leave is

Unpaid leave in Portugal — "licença sem retribuição" or commonly "licença sem vencimento" — is a pause in the employment contract during which the worker does not work and the employer does not pay.

The contract is suspended, not terminated. You remain an employee of the company, you keep your seniority count, you keep your right to your job — you just do not receive salary, allowances, or pay any social security or income tax during that period.

It is governed by Art. 317 of the Labour Code.

The two types of unpaid leave

Art. 317 covers two very different scenarios — it matters which one you are in.

1. General leave (Art. 317 no. 1) — by agreement

"By written agreement, the employer may grant the worker, at the worker's request, unpaid leave."

Here you do not have a right, you have a possibility. The employer can say no without explanation. The reason can be anything:

• Travel.
• Caring for a sick family member.
• Personal project.
• Temporary work in another field.
• Burnout (sick leave already exists, but some prefer this route).

Because it depends on agreement, everything is negotiable: duration, dates, return conditions, whether you need to give notice if you want to extend.

2. Training leave (Art. 317 no. 2) — a RIGHT

"The worker has the right to unpaid leave of more than 60 days to attend a course taught at an educational or vocational training establishment."

This leave only exists if you meet all these requirements:

• You attend a course taught by an educational or vocational training establishment (university, polytechnic, certified training centre).
• Duration more than 60 days.
• Request filed with 90 days of notice, in writing.
• You are not in any of the 5 refusal situations (see below).

Here the employer cannot refuse at will. They can only refuse based on one of the 5 specific grounds.

The 5 grounds the employer can refuse training leave

Art. 317 no. 4 lists the 5 valid reasons for the employer to refuse training leave:

Outside these 5 grounds, refusal is unlawful. If it happens, you can:

1. Request written reasoning in detail.
2. File a complaint with ACT (Portuguese labour authority) for breach of Art. 317.
3. In extreme cases, go to the labour court.

How to request — what the request needs

The request must be made in writing, in duplicate (one copy for the employer to stamp as received). Include:

• Worker identification (name, role, employee number if any).
• Requested dates (start and end).
• Reason (optional for general leave, mandatory for training leave with proof of enrolment).
• Commitment to return on the planned date.
• Contact details for the employer's reply.
• For training leave: enrolment certificate from the course + duration + workload.

Delivery: hand-delivered with stamped copy or registered letter with acknowledgement of receipt. Email only counts if the employer confirms in writing.

What changes in the contract during the leave

During unpaid leave (Art. 317 no. 5):

• No salary and no allowances (holiday, Christmas, meal).
• No social security or income tax deductions.
• No work for the company — you cannot be called in.
• Still an employee — not dismissed, not unemployed.
• Seniority counts (Art. 317 no. 4 — for Labour Code purposes).
• Right to the job is preserved when you return (Art. 317 no. 5).
• Duties of attendance and performance are suspended, but loyalty, confidentiality and respect remain (Art. 128).

Can you work for another company during the leave?

Short answer: yes, in principle. The contract is suspended, not terminated, and you have no duty to provide work to the original employer.

But there are 3 important limits:

1. Direct competition. You cannot go work for a direct competitor in the same sector. This breaches the duty of loyalty (Art. 128 no. 1 f) and can be just cause for dismissal when you return. [Common interpretation:] occasional consultancy in a totally different sector, a personal project outside the company's market, or an internship abroad are usually acceptable.
2. Active contract clauses. Read your contract. If it has an exclusivity clause or non-compete clause, that clause can stay in force during the leave. Request written authorisation first.
3. Prior agreement. The safer route is to talk to the employer when filing the request and state clearly: "I plan to use this time to take a course and freelance in [field]." If the employer agrees, you are covered. Without that, any parallel work carries risk.

Returning to work — what to expect

Art. 317 no. 5 guarantees the right to the job. This means:

• Same job category you had before.
• Same or higher salary (if the collective agreement increased during your absence, you are entitled to the new amount).
• Same workplace, except for an internal reorganisation affecting whole teams (not just you).

If the employer, on return:

• Puts you in a lower category — contract breach.
• Offers a lower salary — breach of the irreversibility principle.
• Dismisses you a week later without just cause — unlawful dismissal.
• Pushes you into a mutual-agreement exit "because you no longer have a position" — abuse.

In these cases you can:

• Refuse the change and demand your previous role in writing.
• Resign with just cause (Art. 394 no. 2), with severance of 15-45 days per year + unemployment benefit.
• File a complaint with ACT.

Differences for the public sector

If you work for the State (central administration, local council, public school, public hospital), the rules are not those of the Labour Code. The General Public Service Labour Law — Law 35/2014 (LTFP) applies.

Main differences:

If you work for the State, talk to HR based on LTFP, not based on this guide.

5 common mistakes that cost money or the job

1. Verbal agreement. Without a written document, the employer can later claim never to have authorised it and treat your absence as unjustified absences — a direct route to just cause dismissal (Art. 351 no. 2 g, 5 consecutive absences).
2. Mixing up general leave and training leave. If you are taking a master's, you may have a right under no. 2 — you do not depend on goodwill. Request that regime explicitly to be protected.
3. Not disclosing parallel work for a competitor. The manager finds out and you get a disciplinary notice on return. Disclose in advance or pick another project.
4. Forgetting Social Security contributions. A 1-year leave with no contributions can push your retirement back by 12 months and break the qualifying period for unemployment benefit. Consider the voluntary social insurance scheme.
5. Not confirming the exact return date in writing. In the month before returning, send an email confirming: "Confirming my return to work on [Date], in the role of [Position], on the usual schedule." Avoids misunderstandings.

How it connects

If you are reading this now, you are probably in one of these situations:

• You are about to request and want to know if the employer can refuse. Look at the 5 specific grounds (no. 4) — they only apply to training leave. For the general leave, the employer can refuse freely.
• You already requested and it was unfairly refused. Request written reasoning, and if it was training leave outside the 5 grounds, file with ACT.
• You are on leave and the employer wants to dismiss you. They cannot dismiss you because of the leave. If they invent another reason, it is unlawful dismissal — calculate the severance to see what is at stake.
• You are planning a long pause and want alternatives. Compare unpaid leave with mutual agreement (you leave with severance and unemployment benefit) — financially the second is often better.