Macau Labor Law QA 1
Context
The Macau SAR law has specific rules governing the labor relationship between an employer and an employee, as described in Law 7/2008.
Considering the specificity of the labor market of the Macau SAR and that said specificity tends to raise several questions for the employers and employees, our Firm has decided to prepare a Q&A, that will be divided into several chapters.
These chapters will focus on the main questions that we receive almost daily.
In the first chapter, we will address the main questions arising from the formation of the employment relationship.
From the perspective of an employer, before commencing any employment relationship in the Macau SAR it is of paramount importance to ascertain if the employee is a Macau SAR resident, i.e., if he or she is an individual who holds a Macau SAR ID Card.
Different employment rules will apply depending on whether the employee is a Macau SAR identity card holder or a non-Macau SAR resident.
In addition, a non-Macau SAR resident must hold a valid work authorization from the Macau authorities to legally work in the Macau SAR.
I
Q: Is it mandatory to have a written employment contract for the employment relationship to be valid?
A: It is not mandatory to have a written employment contract if the employee is a Macau ID card holder.
Without prejudice, the Macau SAR law imposes that a written employment contract be executed if the employment relationship is subject to a term if the employee is aged between 16 to 18 years or if the employee is a non-Macau SAR resident (i.e., does not hold a Macau identity card).
II
Q: Are there any consequences if the parties choose not to execute a written employment contract?
A: If the parties choose not to execute a written employment contract, the employment relationship with a Macau SAR identity card holder will be deemed as an employment relationship with no term.
III
Q: Are there any mandatory clauses that need to be set out in the employment contract?
A: Yes, there are elements that are mandatory to be determined and agreed in an employment relationship and therefore, if a written employment contract is executed, said elements must be included therein.
Those elements are the complete identification of the parties (including their respective addresses of the parties), the duties and job position of the employee, place of work, work hours, the effective date of the commencement of the employment relationship, and the date when the contract is executed.
In the cases of employment relationships subject to term, the term, and the justification for said term must also be included in the contract.
Lastly, if the employee is hired to replace another employee, then the identification and duties of the replaced employee must be included in the contract.
IV
Q: Does the employment contract need to be signed in duplicate?
A: Yes, the employment contract must be signed in duplicate, so that each party can keep one original.
V
Q: Can a company operating in the Macau SAR hire a non-resident?
A: A Macau SAR company or employee may hire a non-resident as an employee.
Without prejudice, a non-resident will have to obtain working authorization from the Macau SAR authorities prior to commencing the employment relationship.
VI
Q: Can the employment relationship be subject to a term?
A: Yes, it is possible to subject an employment relationship to a term, regardless of whether it is a certain term (such as a period of time) or an uncertain term (such as the duration of a temporary work/task). Without prejudice, the Macau SAR law imposes certain conditions for that term to be valid.
In general terms, an employment relationship subject to term will only be considered valid if the employee subject to the employment contract with the term was hired to face a temporary necessity of the employer or a specific task that the employer requires to be conducted.
Without prejudice to the above, the employment contracts entered with non-resident employees must be subject to a term or to the expiration date of his/her work authorization granted by the Macau SAR authorities.
VII
Q: Can the term for a specific employment contract be 3 years?
A: No. The term of an employment contract cannot exceed 2 years.
If this period is exceeded the employment contract will be converted into an employment contract with no term.
VIII
Q: Is there any consequence if the term is not properly identified in the employment contract?
A: As mentioned, employment relationship subject to term must be set out in a written contract.
The term and its justification are mandatory elements to be included in the employment contract.
If this is not set out in the employment contract, it will be deemed for all legal purposes as an employment contract without term.
IX
Q: Is it possible to renew an employment contract subject to a term?
A: Yes, it is possible to renew an employment contract subject to a term.
However, said contract can only be renewed two times, provided that the 2-year maximum period for an employment contract subject to term has not yet been exceeded and that the justification to maintain said employment relationship subject to a term is still valid.
X
Q: Is it possible to set out a probationary period for the employment contract?
A: The Macau SAR law states that employment contracts should include a probationary period so that both parties can evaluate their interest in the employment relationship.
Without prejudice, it is possible for both parties to agree on excluding a probationary period from the employment relationship, provided that said exclusion is set out in a written document (preferably in the written employment contract).
XI
Q: How long should the probationary period last?
A: As a rule, the parties may agree on the duration of the probationary period, if it does not exceed the following limits:
- 180 days for employees that perform duties of high complexity or duties that require a special qualification or management duties;
- 30 days for all employees subject to an employment contract with term; and
- 90 days for all other employees.
XII
Q: What are the requirements to terminate the employment relationship during the probationary period?
A: Before terminating an employment relationship within the probationary period, the parties should consider if they agreed on prior notice to terminate the employment relationship within the probationary period.
Without prejudice, it should also be taken into consideration that if the probationary period has lasted for more than 90 days, then the party that wishes to terminate the employment relationship must give a prior notice of 7 days counted from the date on which he/she intends to terminate said relationship.
If you have additional questions, you can find out more about our services on our Employment Practices page and in our Macao Labor Law QA 2, or contact one of our dedicated lawyers, Manuela António, Tiago Assunção, and António Zhang.
We shall be pleased to assist you through all the steps and help you achieve your goals.