A Guide to Employee Background Checks in Portugal

Employee background checks should be an integral part of your recruitment process when looking to hire in Portugal. Although not mandatory, they are a common practice, especially in finance and healthcare industries.

Pre-employment background check of your job applicants not only helps confirm the competencies of your new hire but also ensures a safe and reliable working environment. 

In this article, you will discover:

• How to run an effective and legal employment screening in Portugal 
• What types of checks are the most common
• What mistakes to avoid when performing a background check in Portugal

Why hire in Portugal?

Portugal is known for its highly educated and skilled workforce, especially in the tech sector. The country has a strong education system with a focus on technology and business, producing over 7,500 new tech graduates per year from top universities.

This talent pool is complemented by a significant influx of global tech talent due to Portugal's attractive living conditions and tech visa program, making it an ideal location for companies looking to hire skilled professionals. Understanding how to run effective background checks will help you sift through the vast pool of candidates and find the best ones for the job.

Essential information for a background check in Portugal

An employee background check is the process of verifying a potential hire’s work history, education, professional qualifications, and any criminal records they might have. It’s particularly beneficial to run before finalizing an employment offer or signing a contract, as it ensures the candidate meets the company's standards and requirements. 

In Portugal, the processing of personal data, including employee background checks, is governed by the General Data Protection Regulation (GDPR) which is aligned with the Data Protection Law of Portugal. The Portuguese Data Protection Authority (CNPD) oversees the enforcement of data protection laws and ensures compliance with the GDPR. Employers must adhere to these regulations when conducting background checks to protect the privacy and rights of job applicants and employees.

Under the GDPR, employers must have a lawful basis for processing personal data for background checks. This lawful basis often includes obtaining the explicit consent of the individual or fulfilling a legal obligation related to the hiring process. 

It's important that employers clearly communicate the purpose and scope of the background check to the candidate and obtain their consent before initiating the process. 

Are background checks legal in Portugal?

Background checks are legal in Portugal, provided they comply with the GDPR and national data protection laws. However, there are specific regulations and restrictions that recruiters need to be aware of when conducting background checks. 

For instance, GDPR specifies that personal data should not be kept for longer than necessary for the purpose for which it was collected. 

Therefore, employers should establish clear retention periods for background check information and ensure its secure storage and eventual disposal in compliance with data protection laws.

It's worth noting that candidates have the right to dispute the findings of a background check in Portugal if they believe the information is inaccurate or misleading. Employers should provide a transparent process for candidates to address discrepancies and provide additional context.

What types of background checks are illegal in Portugal?

In Portugal, certain types of background checks that infringe upon an individual's privacy or are not directly relevant to the job application process are considered illegal.

• Conducting credit checks without explicit consent or conducting extensive social media background checks without a clear job-related purpose may violate data protection laws. 
• Seeking information about an individual's private life or beliefs that are not directly related to their professional qualifications and suitability for the role.
• Discriminating based on factors such as age, gender, sexual orientation, or religious beliefs (as stated in the Portuguese Labor Code)

Under Portuguese Law No 58/2019, the enforcement of data privacy or data protection violations can result in fines up to €20 million or up to 4% of a company's total worldwide annual turnover in the preceding financial year, whichever is higher. 

In addition to administrative fines, criminal offenses related to data protection can lead to imprisonment for up to four years and fines up to €240,000, covering actions like misuse of personal data, unauthorized access, data theft, and violation of the duty of secrecy

One instance when Portuguese privacy laws went into effect was a situation when CNPD imposed a major fine of €400,000 on Hospital do Barreiro in 2018 for GDPR violations, including allowing indiscriminate access to an excessive number of users.

Common background check industries

In Portugal, various industries rely on background checks to ensure the integrity and suitability of their workforce. 

• The financial sector, including banking and insurance companies, commonly conducts thorough background checks due to the sensitive nature of financial transactions and the need to comply with regulatory requirements.
• Healthcare industry strongly emphasizes background checks to assess the trustworthiness and qualifications of healthcare professionals who work directly with patients. 
• Government agencies and public institutions often mandate comprehensive background checks for positions involving access to sensitive information or decision-making authority.

Types of background checks in Portugal

Background check mistakes to avoid in Portugal

No matter if you’re hiring employees or contractors in Portugal, there are a few things that you shouldn’t do as an employer, when it comes to background checks:

1. Lack of consent: Failing to obtain explicit consent from the candidate before initiating a background check violates data protection laws and undermines the candidate's privacy rights.
2. Overreliance on social media: Overreaching into a candidate's personal social media accounts without a clear job-related purpose may infringe upon their privacy and lead to biased hiring decisions.
3. Discriminatory practices: Using background check information to discriminate based on protected characteristics, such as age or gender, is not only unethical but also illegal under Portuguese labor laws.
4. Data retention violations: Failing to establish clear retention periods for background check data and secure its storage may result in non-compliance with data protection regulations.
5. Inaccurate information: Relying on unverified or outdated information during the background check process can lead to erroneous hiring decisions and potential legal issues.

Step-by-step guide of employee background checks in Portugal

Here are the steps that employers hiring in Portugal should follow to ensure legal and effective background checks:

1. Obtain candidate consent: Before initiating a background check, obtain explicit consent from the candidate, clearly outlining the purpose, scope, and processing of their personal data in compliance with the GDPR.
2. Identify relevant information: Determine the specific information relevant to the job role, such as qualifications, work experience, and criminal record (if applicable).
3. Choose reliable sources: Select reputable sources for verifying the candidate's information, such as educational institutions, previous employers, and official criminal record databases.
4. Verify educational and professional qualifications: Validate the candidate's academic degrees, professional certifications, and licenses through direct contact with the issuing institutions.
5. Verify employment history: Confirm the accuracy of the candidate's work experience, including job titles, responsibilities, and employment dates, by contacting previous employers.
6. Check criminal record: If required for the role, conduct a criminal record check through official channels while ensuring compliance with data protection laws.
7. Check credit history (if applicable): If relevant to the position, request the candidate's consent to conduct a credit history check in accordance with the GDPR and national data protection laws.
8. Interview and check references: Conduct thorough interviews and contact-provided references to corroborate the candidate's qualifications and suitability for the role.
9. Document the process: Maintain clear records of the background check process, including the consent obtained, sources contacted, and the information verified.
10. Communicate findings: Transparently communicate the results of the background check to the candidate, allowing them to address any discrepancies or provide additional context.

You can also automate this process using Deel, and get a fast employee background check, with results coming in a matter of minutes.

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Are you looking for an easy and safe way to run a background check? It only takes minutes to get results with Deel.