Detailed overview
Portugal is regulated by the EU AI Act and has local labour-law rules on algorithms and AI. Portugal does not have a separate horizontal AI Act equivalent to the EU AI Act, but its Labour Code contains specific information duties where algorithms or AI affect employment.
Labour Code rules
Under Portuguese labour law, employers must inform workers about the parameters, criteria, rules and instructions on which algorithms or other AI systems are based where those systems affect decisions about access to employment, maintenance of employment, working conditions, profiling or control of professional activity. This rule is relevant to AI used in recruitment, worker evaluation, performance management, shift allocation, productivity monitoring and platform work.
Portuguese law also requires similar information for worker representative bodies. The same type of information must be provided where algorithms or AI affect employment access, job maintenance, working conditions, profiling or professional-activity control. Breach of certain worker-representation information duties is classified as a serious administrative offence.
EU AI Act
The EU AI Act is also important in Portugal. AI used for recruitment, selection, worker management or access to self-employment may qualify as high-risk AI. Providers of such systems must comply with high-risk AI requirements, including risk management, data governance, documentation, conformity assessment, human oversight, accuracy, robustness and cybersecurity. Deployers must use the system according to instructions, monitor it, maintain oversight and inform workers where required.
Data protection
Where AI systems process personal data, the GDPR applies. Employment AI often processes personal data and may involve profiling or automated decision-making. This can trigger transparency duties, data-protection impact assessments, security obligations and individual rights.
Penalties
Penalties may arise under the EU AI Act, Portuguese labour law and data-protection law. Under the EU AI Act, prohibited AI breaches may lead to fines up to EUR 35 million or 7% of worldwide annual turnover, while other AI Act breaches may lead to fines up to EUR 15 million or 3% of worldwide annual turnover. Portuguese labour-law breaches may be treated as serious administrative offences where the Labour Code so provides.