The 39-year-old Portuguese manager parted ways with Olympiacos in the summer, after the completion of a succesful domestic campaign that ended with them retaining the Greek league title.
Silva had previously been at the helm of Estoril for three years and guided them to promotion to the Portuguese top flight in 2011/12.
He left Estoril for Sporting Lisbon in 2014 but was sacked after one season despite leading them to Portuguese Cup title.
Phelan was fired on Tuesday night, following Monday's 3-1 defeat to West Brom, with his tenure as permanent manager only lasting for approximately three months.
He had previously served as caretaker manager since the summer, when Hull parted ways with Steve Bruce.