Employing domestic staff in Portugal and Spain: the insurance the law requires

Part of our guide to home insurance in Portugal for property owners; for Spain, see high-value home insurance in Spain.

A cleaner two mornings a week. A gardener who comes on Fridays. A nanny during the school holidays, a carer for an elderly parent, a housekeeper who opens the villa before you arrive. In Portugal, if you engage any of them directly rather than through a company, you are an employer, and one specific insurance is compulsory. In Spain you are equally an employer, but the accident cover works differently — set out below.

Most foreign owners do not know this, and the ones who do often assume their home insurance covers it. It does not.

The compulsory cover: seguro de acidentes de trabalho

Portuguese law requires every employer to hold workers’ compensation insurance — seguro de acidentes de trabalho — for their employees, and the obligation extends to domestic service (serviço doméstico). It is not optional, it is not means-tested, and it does not depend on how many hours a week the person works.

The policy responds to injury or illness arising from the work, and it covers:

• Medical treatment, rehabilitation and transport costs following a workplace accident.
• Compensation for temporary incapacity, paid as a proportion of earnings while the employee cannot work.
• Compensation for permanent incapacity, assessed against a statutory scale.
• Death benefits and a funeral allowance payable to dependants.
• Accidents in itinere — on the normal journey to and from work — which is a genuinely significant exposure for staff arriving by scooter or bicycle.

Without the policy, those costs fall personally on the employer. There is no cap and no ceiling; a serious injury to a 40-year-old gardener who cannot work again is a liability measured in six figures. The state pursues uninsured employers for the amounts paid out, and there are separate contraordenação fines for the failure to insure.

What your home policy does not do

This is where the confusion sits. A Portuguese multirriscos habitação policy contains a civil liability section, and it is easy to assume that covers “anyone who gets hurt at my house”. It does not, and the distinction is fundamental rather than technical.

The home policy’s liability section almost universally excludes bodily injury to your own employees, precisely because that exposure belongs in a compulsory statutory product. Two different policies, two different purposes.

The rest of the employer obligations

The insurance is one piece. Engaging someone for domestic service in Portugal also means registering them with Segurança Social before they start, paying the employer’s social security contributions, respecting minimum wage, holiday entitlement and the Christmas and holiday subsidies, and terminating the relationship lawfully if it ends. The full picture is set out in our article on the employer obligation nobody explains, and the practical insurance side for households with several staff in insurance considerations for staff employed at home.

Two practical points that come up constantly. First, paying in cash does not remove the obligations; it simply means they are unmet. Second, a long-standing informal arrangement inherited from the previous owner is still your arrangement from the day you continue it.

What about contractors and agencies?

If the cleaner comes from a cleaning company, or the gardener runs his own business with a NIF and invoices you, they are not your employee and their own insurance applies. That is a legitimate and common structure. But it depends on the substance, not the label:

• Ask for the company’s or the self-employed person’s workers’ compensation certificate and keep a copy. Renew the copy annually.
• Ask for their civil liability cover too — for damage caused to your property while working.
• Be wary of an arrangement where the person works only for you, on your schedule, with your equipment, for years. Portuguese law looks at the reality of the relationship, and that pattern looks like employment regardless of how the invoices are worded.

What it costs

Considerably less than people expect. Workers’ compensation for domestic service is priced against the declared annual remuneration, and for a part-time cleaner or gardener the premium is typically in the low tens of euros to around €100 a year. For a household with a live-in housekeeper and a full-time gardener it is still a modest figure against the payroll.

For properties with staff accommodation or a guest annexe there is a further point worth checking: the buildings and contents of staff quarters are frequently outside the scope of a standard home policy. Our article on staff quarters, guest annexes and outbuildings covers that gap.

In Spain: registration does the work of the policy

Spain reaches the same protection for the worker by a different route. A household that employs a cleaner, gardener, nanny, carer or driver directly is an employer under the special system for household employees, the Sistema Especial para Empleados de Hogar, and must register the worker with the Seguridad Social before the first day of work, whatever the hours. The employer’s contributions include cover for accidents at work and occupational illness, so there is no separate compulsory private policy of the Portuguese kind. Recent reforms have also given household employees in Spain unemployment protection and placed health-and-safety duties on the employer, including an assessment of the risks of the home as a workplace.

The insurance consequences follow from that:

• Registration is the cover. An unregistered worker who is injured leaves the household exposed to the cost of the benefits registration would have provided, and to penalties. In Spain the failure is one of registration; in Portugal it is registration and a missing policy.
• The home policy still does not cover the employee’s own injury. A Spanish seguro de hogar usually includes family liability, and some wordings extend it to damage domestic staff cause to third parties, but the worker’s own accident belongs to Social Security.
• Employer’s liability above Social Security. Where an accident is attributed to a failing by the employer — unsafe equipment, a missing risk assessment — the worker can claim damages beyond the Social Security benefits. Check that the household liability section, or an employer’s liability extension, responds to that claim; a Social Security surcharge imposed for a safety breach cannot itself be insured.
• Staff who move between homes. A housekeeper who works in both a Portuguese and a Spanish home needs the employment and accident position settled for each country, not assumed from one. See staff who travel with the household.

For households in Spain, see private clients in Spain.

Putting it right

If you have been employing someone without cover, the fix is straightforward and worth doing this week rather than after an accident. Tell us who works at the property, how often, and what they are paid, and we will arrange the workers’ compensation policy and check that your home liability limit is sensible for a household with staff coming and going. We can handle both alongside your existing home cover.

Adler & Rochefort is a commercial brand of Ownizo, Unipessoal Lda., registered in Portugal with the ASF under no. 425591790/3 and in Spain with the DGSFP under the freedom to provide services (LPS). General guidance only; conditions, premiums and cover vary by insurer and profile.

More on this subject: Insurance for private staff who travel with the household