Pedro Martins took part in a debate on Rádio Observador about the Government’s proposal for labor law reform. Some of the ideas He tried to convey:

It is a broad and ambitious proposal, which can be described as a true structural reform. In his view, one of the main pillars of the reform is to give employers greater confidence to hire on permanent contracts, helping to reduce the high level of labor market segmentation that still exists in Portugal.

Portugal currently has the second-highest percentage of temporary contracts in the EU. Among young people (aged 18–29), this percentage even exceeds 50%. This situation both increases (intergenerational) inequality and reduces productivity, steering the economy toward lower value-added activities.

The increased confidence in permanent hiring mainly stems from the proposed changes to the sensitive and complex issue of individual dismissal (for performance). He believes the reform’s proposals — expanding the grounds for opposing reinstatement and eliminating the instruction phase — could significantly reduce the risks for employers when hiring on permanent contracts. Portugal thus moves closer to the standards of most EU countries in this area, creating stronger incentives for more productive and lasting employment relationships.

On the other hand, the proposal also introduces more flexibility to fixed-term contracts. Although this largely reverses recent changes that went in the opposite direction, he believes the Government should explain how it views these fixed-term contract measures in the broader context of reducing labor market segmentation.

Finally, a major uncertainty concerns the position that the Constitutional Court will inevitably take on this matter. The conservative stance most of its judges have shown toward labor reforms aimed at bringing Portugal closer to EU standards is well known. The question is: will the Constitutional Court be able to change?