What is labor compensation reserve fund in SAP PY-PT - Portugal?

SAP Term: labor compensation reserve fund

• Component: PY-PT

• Component Name: Portugal

• Description: A mutual fund that companies must join to ensure that employees receive half the severance pay amount to which they are entitled.

Smart SAP Assistant

• Key Concepts: 
  The labor compensation reserve fund (LCRF) is a fund established by the Portuguese government to provide financial assistance to employees who have been laid off or are facing reduced working hours due to economic conditions. The fund is managed by the Portuguese Social Security Institute (INSS) and is funded by contributions from employers and employees. 
  
  How to use it: 
  Employers must make contributions to the LCRF on a monthly basis, based on the number of employees they have. Employees can apply for financial assistance from the LCRF if they have been laid off or have had their working hours reduced due to economic conditions. The amount of assistance provided will depend on the individual's circumstances. 
  
  Tips & Tricks: 
  Employers should ensure that they are making the correct contributions to the LCRF each month in order to avoid any penalties or fines. Employees should also be aware of their rights and responsibilities when applying for financial assistance from the LCRF. 
  
  Related Information: 
  The LCRF is part of the Portuguese Social Security system, which is managed by the INSS. Further information about the LCRF and other social security benefits can be found on the INSS website.