You would need further advice, but I believe you would be subject to Portuguese employment law. At least, you would pay Portuguese taxes for that employee and

You would need further advice, but I believe you would be subject to Portuguese employment law. At least, you would pay Portuguese taxes for that employee and you would likely need to register with Portugal as an employer. UK advice: http://www.hmrc.gov.uk/nic/work/new-rules.htm#5 http://www.hmrc.gov.uk/nic/work/new-rules.htm#5