“The case of Portugal exemplifies how the recognition of a subcategory of independent workers can ensure accessible social protection by more fairly rebalancing social contributions between the independent worker and contracting entities”, highlights the organisation led by Mathias Cormann.

Economically dependent independent workers are those whose activity is associated at least 50% with a single contracting entity, according to a report by ECO. In these cases, it is not just up to the self-employed worker to make Social Security deductions.

Until 2019, only those that were responsible for at least 80% of the income from independent work were considered contracting entities with contributory obligations. At that time, these entities had to pay a 5% tax on this income.

But the green receipts regime changed at that time. From 50% of activity onwards, it was considered that there was economic dependence. “This decrease from 80% to 50% increases the number of workers who are now considered dependents and benefit from unemployment benefit“, as highlighted by the then Secretary of State for Social Security, Cláudia Joaquim.

In addition, the rates applied to contracting entities also changed: it increased to 7% if the entity is responsible for 50% to 80% of the worker's income; or 10% if the entity is responsible for more than 80% of the income.

Now, in the OECD's view, the creation of this subcategory of economically dependent independent workers is an “innovative strategy” that “effectively” facilitates the social co-contribution of workers and contracting entities, reinforcing the coverage of social protection offered to these beneficiaries.