Parliamentary Group

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Draft Law No. 48 /XI

1ª Amendment to Law 110/2009 of September 16, which establishes a

new date for the entry into force of the Contributive Code

I-Analysis of the Socio-Economic Situation

The XVII Constitutional Government presented at the Assembly of the Republica the Proposal for a Law

n. 270 /X, Approves the Code of the Contributive Regimes of the Previdential System of

Social Security, which, like the favorable vote of the then socialist majority, came to give rise

to Law 110/2009 of September 16, 2009.

The said Act arose following the Agreement concluded between the Government and the Partners

Social, on Social Security Reform, with a date of October 2006. What

conforms a difference of 2 years in relation to the submission of the Proposal of Law, which

it only occurred at the end of 2008 and a delay of virtually 3 years in relation to the publication of the

Law. In this temporal space, the economic conjuncture has suffered a drastic setback and,

currently, we are going through a very serious economic-financial crisis, without any

end prediction, which has been translated into a high closing number of

companies, with a consequence a marked rise in unemployment numbers and the

negative growth of our economy.

Currently, according to figures from September of the Instituo of Employment and Training

Professional, find unemployed 510356 people, which means an increase in

practically 30% in relation to September 2008. The National Institute of Statistics

has moved forward with a 9.1% unemployment registered in Portugal in the 2 quarter of 2009, which

translates to 507.7 thousand unemployed, already in relation to the 3 th quarter of 2006, the same

entity divulged unemployment situated in the 7.4%, which means 417.4 thousand

unemployed. From the analysis since two figures stands out that unemployment has increased

in about 100 thousand unemployed since it was signed the Agreement between the Government and the

Social Partners.

Presently the country crosses a negative inflation situation, from -1.6%, to which it already comes

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being below 0 for already a few months and, of which, there are no such rapid ascent predictions.

In relation to the Gross Domestic Product, the National Statistical Institute, announced that in the

2. ° quarter 2009, growth is -3.7%, which comparing with equal period of

2008, lowered 4%, as it was situated in the 0.7%.

In the course of the 1. the 2009 semester there was an increase of about 43% of the shares

in which the Insolvency by the court was declared. The actions of Insolvency Presentation

by the company itself had an increase of 119%. The total of shares / decisions of

insolvency in Portugal had a rather significant increase, 64.7%, of 1387 shares

published in 1 semester 2008 for 2285 actions published in the 1 semester of 2009.

On the contrary, with regard to the constitution of new companies, one has registered a

decrease of about -17%.

We believe so, that the current Government should take is Law to the Permanent Council

of the Social Concertation, so that one can make a new impact of how the entry into

vigour of Law 110/2009 of September 16 interferes with the life of companies and the

workers, taking into account the new economic-social situation that the country runs through.

II-Impact of Entry on Vigor of Law No. 110/2009, of September 16

Law 110/2009 of September 16 carries out the systematization of normative acts that

regulate the entire contributory legal relationship between taxpayers and the previdential system

of Social Security.

However, it is not only the codification of all the legislation perating to the contributory system for the

Social Security that is at issue in this Law as, profound changes are made

at the contributory rates and the existing contributory incidence base, whether it is at the level of the

employing entity, whether it is at the level of the worker, or even the workers

independent.

One of the most significant changes concerns the contributions of workers

agricultural. The scheme still in force, in relation to employees on an account of others,

distinguishes two different situations, differential and undifferentiated agricultural workers.

The contributory rate of differentiated agricultural workers is currently 32.50%,

being, respectively, 23% and 9.50% for the employing entities and for the

workers. For its part, the contributory rate of undifferentiated agricultural workers

is currently 29%, respectively, being 21% and 8% for the entities

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employing and for the workers. With the current Law ended the distinction between

differential and undifferentiated agricultural workers and there has been a single rate

contributor to agricultural workers that went on to be 33.3%, being

respectively, from 22.3% and 11% to the employing entities and to the

workers. Regarding the scheme currently in force for employees

undifferentiated the rate rises 4.3% percent.

With regard to self-employed agricultural workers and providers.

services also register substantial changes. At present, the rate of producers

agricultural and their spouses whose incomes come unique and exclusively from the

agricultural activity is 30.4% in the extended scheme and 23.75% in the obligatory (note that

the vast majority of agricultural producers opts for the compulsory scheme). The Code

Contributory predicts a single rate of 28.3%, which will entail an increase of 4.55% percent, in

relation to the compulsory scheme. However, the changes that are introduced in the scheme of the

independent agricultural workers are not limited to the aggravation of the rate as well

there are changes to the base of contributory incidence. Currently the amount of the

contributions is calculated on the basis of a conventional remuneration, chosen by the

beneficiary, of between 10 scales determined by reference to the Indexing of Apoios

Social, which makes the majority of self-employed people opt for the step

lower, i.e., pay a monthly contribution of 149.35 €. With Law 110/2009, of 16

of September, the basis of contributory incidence has become the remuneration level

determined by reference to the twelfth of the relevant income of the ascertained worker

on the basis of 20% of the sales value of the calendar year prior to that of the fixation of the base of

contributory incidence, in the case of agricultural producers and 70% of the total value of

provision of services in the calendar year prior to that of the fixation of the contributory incidence base.

This amendment will drastically modify the Social Security contributions of the

agricultural producers and service providers. It is denoting that there is an adequacy

wrong on the basis of contributory incidence as, a Social Security fee does not

is to be applied on a sales value or service provision, but on the

effective income.

These changes concerning the incidence base do not reach employees alone

independents who are agricultural producers, achieve in equal form the traders and

the self-employed workers who are providers of services. Also the producers

or merchants come the rate for Social Security to be increased from 25.4%, in the regime

obligatory, for the single rate of 29.6%, i.e. increases 4.2 percentage points.

A further change of profound impact relates to changes to the base of incidence

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contributor who are targeted by the employing entities and the workers who celebrate

work contracts on account of outrain. With the entry into force of the Contributive Code

conforms to a broadening of the base of contributory incidence, particularly in the

following situations:

a) Pre-determinate representation expenses;

b) Abonos for failure;

c) The values of meal allowances, whether they are allocated in cash, or in

meal titles;

d) The diuturnals and other values established in function of the seniority of the

workers at the service of the respective employer;

e) Christmas subsidies, from Fteries, of Easter and others of an analogous nature ;

f) the importances assigned to be of cost aids, travel allowances , expenses

of transport and other equivalents;

g) The amounts allocated to employees in the title of participation in the profits of the

company, provided that the employee is not assured by the contract a

right remuneration, variable or mixed appropriate to your work;

h) Expenditure resulting from personal use by the car car worker

which manages charges for the employing entity;

i) Transport expenses, pecuniary or otherwise, borne by the entity

employing to cost the displacements for the benefit of the workers;

j) Importances earned by the use of own car at the service of the company;

l) Compensation for termination of contract of employment by agreement, in the situations

with a right to unemployment benefits;

m) The values expended by the employing entity with financial applications, the

for employees, specifically, life insurance, pension funds and

savings plans, reform or any supplementary safety schemes

social, when they are the subject of rescue, advance, remitting or any other

form of anticipation of corresponding availability or in any case of

receipt of capital prior to the date of the passage to the pensioner situation, or outside

of legally defined condialisms;

n) The performances related to the performance obtained by the company when it wants to

in the respective title allotted either by its regular and permanent assignment review

stable character regardless of the variety of its amount;

o) All those assigned to the worker, with a character of regularity, in

money or in kind, directly or indirectly as a counterpart to the provision

of the work when the assignment of the same if it is planned according to criteria

of objectivity, albeit subject to conditions.

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III-Conclusion

To check the entry into force of the Contributive Code on January 1, 2010 to

economic situation of workers and employer entities will change

substantially, as behind verified the value of Social Security contributions

will increase in a very conclusive manner.

In addition to these aggravations it is denoted that the Contributive Code is not yet

regulated, which, alone, will already hamper the perception of companies and the

workers in case the Contributive Code between already in force on January 1, 2009. The

Article 4 of Law 110/2009 of September 16, mandates the regulation, made by Decree-

Law or by Regulatory Decree, which has not yet happened.

It should not be coupled with the current economic and social situation that the entry into force of the new

Single Social Rate, a positive aspect of the new Contributive Code, will only be in 2011, the

which reinforces the idea of the entry into force of the remaining Diploma being also in 2011.

We believe that this situation is unacceptable, much more taking into account the current times

of crisis that the country runs through, in that sense that we present this Draft Law,

to ensure a postponement of one year of the entry into force of Law No. 110/2009 of 16

of September.

In these terms, the Deputies of the CDS-People's Party present the following Project of

Law:

Article 1º

It is amended to Law No. 110/2009, of September 16, Article 6, which passes the following

wording:

" Article 6.

Entry into force

1-A This Law shall come into force on the January 1, 2011.

2-The provisions set out in Articles 277 a to 281 will go through as a first year of

reference for entry into force the year 2011, by adapting consecutively to the years

following. "

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Article 2.

The entry into force referred to in the preceding article shall be preceded by an evaluation carried out in

meeting of the Standing Committee on Social Concertation

Assembly of the Republic, November 9, 2009

The Deputies