Increase in the National Minimum Wage
As from 1 January 2026, a new increase in the National Minimum Wage (Salário Mínimo Nacional – SMN) entered into force, within the framework of the policy for the progressive enhancement of earned income, with the SMN being updated from €870.00 in 2025 to €920.00 in 2026.
Employers must therefore ensure the timely adjustment of salary levels.
Update of the Public Administration Base Salary
Effective January 1, 2026:
- New public sector minimum wage of €934.99.
- A minimum increase that will be the greater of the following two amounts:
- For base pay up to €2,631, an increase of €56.58 per employee.
- For base pay above that amount, an increase of +2.15% compared to the pay scale in force in 2025.
Update of the Meal Allowance
With effect from 1 January 2026, the daily amount of the meal allowance applicable to Public Administration employees increases from €6.00 to €6.15, with corresponding implications for the applicable tax-relevant thresholds.
Although this amount applies directly to Public Administration employees, its update constitutes a relevant benchmark for the private sector, particularly as regards the tax exemption limits applicable for personal income tax (IRS) and social security contribution purposes, which are updated to €10.46 per day when the allowance is paid through a meal card and €6.15 per day when paid in cash.
Update of the Social Support Index (IAS)
The Social Support Index (Indexante dos Apoios Sociais – IAS) was also updated in 2026, from €522.50 to €537.13, with repercussions on several social security benefits, contribution bases and legal thresholds, including maximum amounts of Social Security benefits, such as unemployment benefit.
Increase in Pensions and Social Benefits
The statutory and regulatory old-age and disability pensions under the general social security scheme, as well as retirement and disability pensions under the convergent social protection scheme (CGA), were updated.
Pensions, in particular lower-value pensions, increased by 2.8% compared to 2025, with variations depending on income brackets:
- 80% for pensions up to twice the IAS value (€1,074.26);
- 27% for pensions exceeding 2 and up to 6 IAS (€3,222.78);
- 02% for pensions exceeding 6 and up to 12 IAS (€6,445.56).
Pensions exceeding 12 IAS (€6,445.76) are not updated.
The minimum amounts of disability and old-age pensions under the general Social Security scheme are also updated:
| Contribution career brackets | Minimum pension amount (€) |
| Less than 15 years | 341.08 |
| 15 to 20 years | 357.80 |
| 21 to 30 years | 394.82 |
| 31 years or more | 493.52 |
The minimum amounts of retirement, old-age and disability pensions paid under the convergent social protection scheme (CGA) are also updated:
| Length of service | Minimum amount (€) |
| 5 to 12 years | 318.76 |
| More than 12 to 18 years | 332.24 |
| More than 18 to 24 years | 355.16 |
| More than 24 to 30 years | 397.45 |
| More than 30 years | 526.60 |
Finally, other pensions and supplements are also updated:
- Non-contributory old-age pension – €262.40
- Provisional disability pension – €262.40
- Old-age/disability pension under the special agricultural activities scheme – €314.85
- Old-age pension under the transitional agricultural workers’ schemes – €262.40
- Minimum monthly pension supplement for a dependent spouse – €47.92
- Extraordinary solidarity supplement – €22.38 for beneficiaries under 70 years of age and €45.67 for beneficiaries who have reached or will reach 70 years of age
- Monthly dependency supplement for disability, old-age and survivors’ pensioners under the general Social Security scheme – €131.20 (1st degree) and €236.16 (2nd degree)
- Monthly dependency supplement amounts for disability, old-age and survivors’ pensioners under the special agricultural activities scheme, the non-contributory scheme and equivalent schemes – €118.08 (1st degree) and €223.04 (2nd degree).
Update of Pensions for Occupational Accidents
Pensions due in cases of permanent incapacity or death resulting from occupational accidents were also updated by 2.8% for 2026.
This update has an impact on the potential liability of employers and insurers in the context of occupational accidents.
Update of the Reference Amount for the Solidarity Supplement for the Elderly (CSI)
The reference amount for the Solidarity Supplement for the Elderly (Complemento Solidário para Idosos – CSI) was updated in 2026, increasing by 6.24% compared to 2025, and set at €8,040.00.
As a result, the amount of CSI granted to beneficiaries is recalculated based on this new reference value, with direct effects on the calculation of the supplement payable to pensioners in situations of greater economic vulnerability.
Increase in the Statutory Retirement Age
In 2026, the statutory retirement age increased from 66 years and 7 months in 2025 to 66 years and 9 months, pursuant to the automatic adjustment mechanism linked to life expectancy.
This change is particularly relevant for workforce planning, succession management and the coordination between retirement, pre-retirement and termination of employment contracts.
Other Legislative Changes in Labour and Contributory Matters
In addition to the changes identified above, further relevant amendments were introduced in social security contributions and in the interaction between employers and the Social Security system, resulting from legislation entering into force on 1 January 2026, including:
- Order n.º 233-A/2026, of 6 January, approving the withholding tax tables applicable to employment income and pensions for 2026;
- Decree-Law n.º 127/2025, of 9 December, amending the Social Security Contributory Framework;
- Regulatory Decree n.º 7/2025, of 9 December, detailing reporting procedures and required information;
- Ministerial Order n.º 445/2025/1, of 15 December, redefining evidence and procedures applicable to contributory obligations.
These instruments introduce a new model for the fulfilment of contributory obligations, with a transitional regime applicable during 2026 and mandatory application for all employers as from 1 January 2027.
In general terms, this new framework results in:
- the anticipation of the obligation to notify the admission of employees, which must be carried out before the commencement of work via the Social Security Direct platform; in case of non-compliance, employment is presumed to have started on the first day of the third month preceding the detection of the breach;
- the maintenance of mandatory communication of termination and suspension of employment contracts, as well as changes to contractual arrangements and permanent remuneration;
- the automation of monthly remuneration declarations, subject to employer validation;
- the extension of the deadline for payment of contributions and social security charges, now between the 1st and the 25th of the following month.
New digital functionalities were also introduced on the Social Security Direct Portal, including enhanced pension, unemployment and retirement supplement simulators, as well as the electronic submission of applications for the Dependency Supplement.
Draft Reform of Labour Legislation
Finally, it should be noted that a draft reform of Portuguese labour legislation is currently under discussion within the framework of social dialogue, with its final content and approval timeline still uncertain.
The draft proposal points to potential revisions in key areas of labour law, namely:
- contractual arrangements, including adjustments to fixed-term contracts and other forms of employment;
- working time organisation, with possible reassessment of rules on working hours, adaptability and flexible working arrangements;
- termination of employment, particularly as regards procedures, safeguards and protective mechanisms;
- adaptation of labour law to new forms of work organisation, including digitalisation, platforms and hybrid work models.
Given the non-final nature of this process and its foreseeable evolution within the legislative process, developments will continue to be closely monitored, and the concrete impact of any future changes on corporate organisation and human resources management will be assessed in due course.
The set of measures entering into force in 2026 reinforces the need for a preventive and integrated approach by companies, both in the management of labour relations and in contributory and social security planning.
The Labour and Social Security Law Department of Antas da Cunha Ecija has a specialised team with the know-how and tools required to support companies and organisations in assessing the impact of these measures and implementing the necessary adjustments, from a preventive compliance perspective. The team remains fully available to assist your company throughout this process.
by Pedro da Quitéria Faria, Isabel Araújo Costa and Fernando Vidal Cordeiro, Practice Area – Labour and Social Security
