Doing Business in Brazil

12. Labor Law In Brazil – Brief Overview



Understanding labour relations in Brazil continues to be a significant challenge for Brazilians and foreigners. The labour legislation and specialized Courts are the target of constant criticism.

A guide with the main features and challenges to be faced can help people interpret legislation and caselaw and make the best decisions for managing the issues within companies.

Since the first version of Doing Business, many modifications have been made to the labour legislation, of which the most important and far-reaching is the Labour Reform, consolidated in Laws 13429 and 13467, both in 2017, which heavily amended the Consolidated Labour Laws (CLT), in an attempt to modernize the complex and frequently unintelligible legislative, administrative and judicial structure, reduce State intervention in labour relations and grant more autonomy to the trade unions and to certain categories of employees (considered “hypersufficient”). 

But the pandemic and post-pandemic period were also very productive in terms of legislation and caselaw, imposing on companies the need to adapt, often immediately, to the obligations set forth in legal texts and court decisions. Besides the labour reform, we can cite other legislation that directly impacted on labour relations and which we will address in this new version of Doing Business – the LGPD, the recent Laws 14442 and 14457, which, respectively, altered the provisions regarding the meal allowance and teleworking, established the Emprega + Mulheres (Employ More Women) Program aimed at including and maintaining women in the job market, and provided for measures to support parenting.

With the Labour Reform on the verge of completing six years, the principles inherent in Brazilian Labour Law, which aim to protect the employee against the employer’s disciplinary and economic power, have, however, remained unchanged, or have been attenuated to a minimum degree, and many issues remain open or are still without final definition as to their constitutionality by the Brazilian Judiciary.

The year 2023 has brought many innovations, including those resulting from the change of government, which, in turn, promises the “reform” of the Labour Reform. For this reason, this guide may undergo new modifications in the course of 2023, if the modifications that have been announced materialize, on matters of extreme relevance to companies, such as union structure and funding, intermittent contracts and the regulation of work by apps.



In order to constitute an employment relationship in Brazil, four simultaneous requirements need to be fulfilled: personal service, regularity, economic dependency and subordination. 

Subordination is the most important aspect for defining whether a relationship is one of employment or work. The other conditions are common to other types of contract. 

The Labour Reform did not change the nature of the employment relationship, maintaining the above concept unaltered, although it reviewed/widened the notion of an economic group, permitting the outsourcing of the company’s core-activity and the re-hiring of employees after termination of their contract.

 As for the economic group, the Reform expressly excluded from the legal definition for the purpose of establishing the joint liability of companies the mere fact that the partners/shareholders are the same. It is necessary for the configuration of the group to show a common interest, the effective community of interests and the joint activity of the companies forming part of it. 

As regards the outsourcing of the core-activity, although this represents a great advance, putting an end to the dichotomy between core and non-core activities, sanctioned by Precedent 331 of the TST, it is a fact that, if it is sought to disguise the features of an employment relationship, and evidence of such is produced by the injured party or by the authorities, the purported civil relationship will be converted into one of employment, with all the consequent legal sanctions, in their most varied forms.

Although five Direct Actions of Unconstitutionality (ADIs) have been brought against Law 13429 (ADIs nos. 5685, 5686, 5687, 5695 and 5735), the Federal Supreme Court ruled that the Law and the changes it introduced to Law 6019/1974, which originally dealt with temporary contracting, were constitutional. Simultaneously to this discussion, the STF judged Leading Case RE 958252, theme 725, ratifying the outsourcing of the core-activity prior to the Labour Reform, maintaining the subsidiary liability of the contracting company. The highest court in the country has also established the regularity of outsourcing by hiring liberal professionals, such as doctors, not personally but through legal entities owned by them (pejotização).

In the event of re-hiring of employees, a period of 18 months must be observed between the termination of one contract and the beginning of the other, whether as an employee of an intermediate company or as partner in a service company, unless the owners or partners in the latter company are retired. It is not possible, therefore, to dismiss and immediately re-hire a worker on an irregular basis, unless he is retired and, evidently, the conditions inherent to an employment relationship are not in place. 

The employment relationship is expensive, since it attracts direct costs for the company. These may be summarized as follows: 

    1. Welfare contribution of 20% of the remuneration paid to the employee, to which is added labour accident insurance (from 1% to 3%, which percentage is subject to alteration depending on the aggressive nature of the working environment), and contribution to third parties (agencies representing the economic sector to which the employee belongs) – Sistema S – (average rate of 5.8%), 
    2. FGTS – paid on the basis of 8% of the salary, it is deposited monthly by the employer in a specific account for each employee, who can only withdraw the funds in the events expressly stipulated by law, such as dismissal without cause, termination of a contract for a definite term, retirement, purchase of home, death and serious illness, among others,
    3. 30 days’ vacation, divided into not more than 3 periods, if the employee agrees, one of which not less than 14 days and the others of 5 days, after each period of 12 months’ work, plus a 1/3 bonus. The employee may convert 1/3 of the vacation period to which he is entitled into a pecuniary payment, amounting to the remuneration due for those days. The grant of vacation after the 12-month period following acquisition of this right by the employee subjects the employer to payment of double the sum due, pursuant to article 137 of the CLT, 
    4. 13th salary, based on the employee’s full remuneration.

The employee also has to pay Social Welfare contributions, at rates between 7.5% (up to R$ 1.320,00 – the current federal minimum salary) and 14% (from R$ 3.856,95 to R$ 7.507,49), according to the remuneration he receives, progressively, up to the contribution salary ceiling, currently R$ 877,24. Therefore, an employee who receives more than the welfare ceiling, irrespective of the amount, will pay the fixed maximum sum of R$ 876,97. The employee is also subject to income tax, at a rate of 7.5%, 15%, 22.5% or 27.5%, depending on his remuneration, unless he receives a share of the profits with a separate and more favourable rate of tax.

These are the direct costs, which may be complemented as a result of special aspects of the employment relationship, such as rights stipulated by a collective agreement, overtime, variable remuneration, benefits or instruments of work which, by their characteristics, may be included in the employment agreement and form part of the employee’s remuneration etc.

The employment relationship must be entered in the appropriate document, which in the case of the company is the employee’s registration card and for the employee the work and social security booklet, both now in digital form. All information concerning the employment relationship must also be entered in the e-Social, Digital System of Fiscal Entry of Tax, Welfare and Labour Obligations, introduced by the federal government in order to unify and consolidate all the data of workers in a single document, for all purposes.



The Labour Reform created two new forms of employment. One is intermittent employment, where the worker is paid for the work actually done on an hourly basis, since under this system work periods and periods of inactivity are alternated.

The hourly remuneration may not be less than what is paid to the company’s regular employees. The contract must be in writing and, in addition to payment for hours worked, the employee will be entitled to proportional payment for vacation, FGTS and 13th salary. The amounts paid are subject to the welfare contribution by both parties.

Three Direct Actions of Unconstitutionality (ADIs), nos. 5826, 5829 and 6154, question the constitutionality of the provisions of Law 13.467/2017, which created this type of employment contract. The rapporteur of the action has already voted for its unconstitutionality, on the grounds that this type of contract is unpredictable and uncertain, thereby putting fundamental labour rights at risk. In November 2022, the trial of the action was stayed by a request for examination of the record by another Justice. It is believed that the issue will be judged during the course of 2023.

The second new form of employment relates to telework (or telecommuting), which suffered an unpredictable increase during the pandemic and constituted an indispensable tool for the maintenance of jobs during the suspension of the in-person activities of companies during this exceptional period. Due to the changes imposed by the pandemic on companies, on the hiring and management of personnel, including now as a means of attracting and retaining professionals in the market, the issue has gained outstanding importance and motivated significant changes in this system of work, as inserted by Law 14.442/2022.

Telework is now defined by article 75-B of the CLT as follows: “Telework or remote work is defined as the provision of services outside the employer’s premises, whether predominantly or not, with the use of information and communication technology that, by its nature, does not constitute external work”.  

The sole paragraph of the legal provision referred to expressly states that “The attendance, even on a regular basis, at the premises of the employer to carry out specific activities that require the presence of the employee at the establishment, does not change the nature of the telework or remote work regime”.  

Therefore, even if the worker habitually appears at the employer’s premises in order to carry out duties that require his presence, such as meetings, training, rendering of accounts, production of documents etc., this fact does not disqualify him from the legal exception.

In addition to the changes already listed, Law 14.442 now admits telework for trainees and apprentices and determined that companies must prioritize the delegation of the telework or remote work regime to employees with disabilities and to those with children or a child under legal custody up to four years of age. 

This law also restricted to teleworkers paid by output or work done the exclusion from the rules on duration of work, modifying item III, of article 62, of the CLT, which deals with the legal exceptions to the general rule of submission to control of working hours and receipt of labour rights resulting from hours worked, such as overtime, intra and inter-hour breaks, reduced working hours at night, and additional payment for night work, among others.

While still on the subject of duration of work, §5 of this same legal provision established that “The time of use of technological equipment and necessary infrastructure, as well as software, digital tools or internet applications used for telecommuting, outside the employee’s normal workday, does not constitute time available or on call or standby duty, unless there is a provision in an individual agreement or in a collective bargaining agreement”.

§9 also enables an individual agreement between employee and employer to determine the hours and means of communication between them, as long as the legal rest periods are assured.

Another relevant issue refers to the definition of the territorial basis for application of the legislation and collective rules. §7 of article 75-B provides that “The provisions set forth in the local legislation and in collective labour and bargaining agreements relating to the territorial location of the establishment where the employee is based shall apply to employees under the telework regime”.

Considering also the current dynamics of the global labour market, the circulation of workers through various countries in the world and digital nomadism, §8 was inserted in article 75-B, in an attempt to resolve the obstacle facing companies for determining the legislation applicable to these workers, providing that “To the employment contract of an employee admitted in Brazil who chooses to perform telework outside the national territory, Brazilian legislation applies, except for the provisions of Law no. 7.064, dated December 6, 1982, unless otherwise stipulated by the parties”.

Although it was the intention of the provision to clear up the doubt, it unfortunately did not achieve this goal and left open a series of questions, which may culminate in lawsuits in the Labour Court and penalties imposed by the Ministry of Labour and the Internal Revenue Service.

In the same way, also based on the reality that has become evident in the post-pandemic scenario, §3 established that “the employer will not be responsible for the expenses resulting from the return to work in person, in the event the employee opts for telecommuting or remote work outside the location provided in the contract, unless otherwise stipulated by the parties”.

As an exception to the provision in article 443 of the CLT, which authorizes an individual employment contract by tacit or express agreement, verbal or written, article 75-C determines that “The rendering of services through telecommuting must be expressly stated in the individual employment contract”.

In the same way, imposing exceptional formality for a telework contract, it is possible to alter the regimes that require personal attendance and telecommuting, provided there is a mutual agreement to that effect between the parties, in accordance with a contractual amendment.  

For the performance of telecommuting, the employee needs a structure that enables him to carry out the work. And, in this respect, article 75-D determines that “The provisions relating to the responsibility for the acquisition, maintenance or supply of the technological equipment and infrastructure necessary and suitable for carrying out remote work, as well as the reimbursement of expenses borne by the employee, shall be set out in a written contract”.

Accordingly, a worker who falls under this legal exception will be guaranteed the regulation of the contractual conditions in a written contract, including the structure and the means for performing the services. 

Having stipulated the contractual conditions, and the employer having opted to provide the technological means to enable the worker to exercise his activities, which our professional experience shows to be predominantly the case, especially because of the need for compatibility of such means – the operational systems of the companies among other factors – these items do not form part of the employee’s remuneration, as determined by the sole paragraph of article 75-D, ratifying the rule inserted in item I of article 458 of the CLT.. 

Finally, but of no less importance, the CLT requires the employer to instruct the employees covered by this regime, expressly and ostensibly, regarding the precautions that must be taken in order to avoid work-related illness and accidents. The employee, in turn, in accordance with the sole paragraph of this legal provision, must sign an undertaking to the effect that he will comply with the employer’s instructions”.  


The Labour Reform introduced a new text for article 444 of the CLT, allowing the free stipulation of the contractual conditions of an employee with a university degree and who receives a monthly salary equal to or higher than twice the maximum limit of benefits under the Social Welfare General Regulations to have the same legal effectiveness and preponderance over the collective agreements, as regards those matters that may be negotiated and that are detailed in article 611-A.

At the same time, the said Law added article 507-A to the former CLT text, in order to permit the stipulation of an arbitration clause, for the resolution of disputes arising from the situation of an employee whose remuneration exceeds twice the maximum limit of benefits under the Social Welfare General Regulations, provided this occurs on the initiative of the employee or with his express agreement.



The change in question, which is significant in our opinion, permits greater freedom to contract than was previously authorized by the caput of article 444 of the CLT, and guarantees that the contractual conditions stipulated between employer and employee, that fulfill the requirements therein specified, are as effective as the collective agreement.

In other words, negotiations entered into between an employee considered “hypersufficient”, in accordance with the definition contained in the sole paragraph of article 444, and the employer are valid, effective and binding on the parties, provided of course that they respect constitutional and legal limits.

Therefore, when negotiating with a “hypersufficient” person, care must be taken to verify if the right under discussion is subject to any formality prescribed by the constitution and/or by law, such as, for example, agreements for the reduction of salaries and working hours and for the institution/payment of profit sharing, for which there exist restraints such as mandatory collective bargaining. 



This change entailed the breaking of a paradigm in Brazilian Labour Law, which has always been opposed to this method of conflict resolution.

The Labour Reform now allows the establishment of an arbitration clause to resolve conflicts arising out of the employment relationship of an employee whose remuneration is higher than twice the maximum limit for benefits under the General Social Security System, provided that this is done on the employee’s initiative or with his express agreement.

Differently from the sole paragraph of article 444 of the CLT, in this case, an employee who does not have a university degree, but receives remuneration that exceeds double the ceiling of the social security benefit, is considered capable of signing an arbitration clause.

In any case, considering that the arbitration procedure is specialized and involves costs for the parties, it should be used sparingly and only in contracts the characteristics of which justify the inclusion of this method of dispute resolution. 

Despite the express authorization for the execution of clauses of this nature, our fear is that the Labour Courts will declare the unconstitutionality of article 507-A, on the grounds that labour rights cannot be waived.



The normal duration of work is 8 hours per day and 44 hours per week. Other limits, whether lower or higher, are permitted, as provided in special legislation relating to a given category of worker or collective labour agreements. 

In order to establish a working schedule of 44 hours a week, the employee should work 4 hours on Saturdays, which is becoming more and more unusual in Brazil, one of the reasons being to reduce indirect costs (such as transport, meals, water and electricity). Companies therefore opt to introduce these 4 hours in the working days from Monday to Friday, with the employee starting to work a few minutes extra on these days, to make up for his absence on Saturday. 

With the Labour Reform, there are now two options for part-time contracts. In the first, the contract will be for up to 30 hours a week, with no provision for overtime. In the second case, the contract will be for up to 26 hours per week, up to 6 hours’ overtime being permitted. 

The employee may work overtime, subject to a maximum of 2 hours. As an exception to the limit of 2 hours’ overtime per day, the new CLT permits, by means of an individual or collective agreement, a working day of 12 hours followed by 36 hours’ rest, with the intervals for refreshment and rest being observed or remunerated. It is also permitted to establish a working day of 12 hours, subject to the limit of 220 hours per month. 

The remuneration due for overtime is at least 50% more than for a normal hour. Some collective labour agreements stipulate percentages higher than the rate provided for by law, principally for the purpose of discouraging employers from allowing overtime. 

Habitual overtime forms part of the employee’s remuneration, for the calculation of vacation pay, 13th salary, prior notice, FGTS etc.

Overtime worked may be remunerated by the employer otherwise than by the payment of cash. In Brazil this is called the Hour Bank (compensatory or comp time) system, a procedure whereby the excess time worked one day is compensated by partial or total rest on another. The Labour Reform introduced an important modification, permitting an Hour Bank agreement to be made directly between the employee and employer, provided that compensation for the overtime is made within a period of 6 months.

In any continuous work that lasts for more than 6 hours, an interval of at least one hour for refreshment and rest is obligatory. For a shorter period not exceeding 6 hours, an interval of 15 minutes is obligatory. An employer who fails to grant the interval for refreshment and rest must indemnify the employee in the exact proportion of the right not enjoyed, and no longer the entire period as was decided before the Reform, with an addition of 50%. Such payment will be of an indemnity nature.

Between one working day and the next, the employee is entitled to a minimum of 11 hours’ rest, which cannot be absorbed by the weekly rest. 

Every employee is entitled to remunerated weekly rest (DSR) of 24 consecutive hours, that normally coincides with Sunday. 

Failure to grant the interval between working days and the DSR gives rise to the obligation to pay overtime to the employee who did not receive them. 

As a rule, work performed between 10 p.m. one day and 5 a.m. of the next is considered night-work. Other economic activities, such as cattle-breeding and agriculture, are subject to different night hours. One hour of night-work is computed as 52 minutes and 30 seconds, that is to say, 7 hours’ work at night is equivalent to 8 hours during the day. Remuneration for night-work is at least 20% more than for work done during the day.

According to the new CLT text, the time spent by the employee travelling between his home and his work-place, and vice-versa, will not be computed in his working day, since it does not constitute time at the disposal of the employer. Prior to the Reform, in situations where the employer provided transport for its employees, because the establishment where they work is situated in a place of difficult access or is not served by public transport, travelling time was considered as time worked. This rule is now valid for journeys on foot, within the company’s establishment or by any means of transport, including that provided by the employer.

None of the rights relating to working hours, referred to above, are due to three categories of employee:  


  1. those who exercise an external function, incompatible with fixed working hours; 
  2. those who occupy a position of trust, who are not subject to control of their working hours, have powers of command and management, occupy a high-level position in the company’s organizational chart and receive differentiated salary and benefits in comparison with their subordinates;
  3. those employed under the telecommuting system, who work on the basis of volume of production or tasks performed. Other teleworkers are included in the Chapter on Duration of Work and are entitled to the protections referred to therein, pursuant to Law 14.442/2022.


The new CLT text disregards various situations as time on standby or worked, prior to the start or after termination of the agreed working hours, when the worker remains on the company’s premises, whether by his own choice or to seek personal protection, such as religious practices, rest, leisure, study, meals, social activities, personal hygiene and change of clothing or uniform, when the latter is not obligatory, even in excess of the tolerance limits currently in force (5 minutes on arriving and leaving, subject to the limit of 10 minutes per day).

The payment of overtime to the employee, whether for excessive hours or non-compliance with the obligatory intervals and rest periods, does not prevent the company from receiving notices from the Ministry of Labour for violation of the law. The penalties charged in these cases, subject to rare exceptions, are not heavy. 



Remuneration is the total of sums of money and benefits paid to employees in consideration for services provided for the benefit of the employer. 

Salaries – the fixed amount guaranteed to the employee on being hired – cannot be reduced (art. 7, VI, of the CF) – except by collective negotiation, cannot be altered unilaterally by the employer to the employee’s detriment, cannot be levied upon (art. 649, IV, CPC), and are intangible (cannot normally suffer deductions – art. 462 of the CLT and Precedent 342 of the TST).

Salaries are subject to obligatory readjustment at least once a year, in accordance with the annual pay-rise date applicable to the category of worker. The great majority of trade unions determine payment of the salary readjustment to all employees, regardless of their qualifications, position in the corporate hierarchy or salary, but there are Collective Agreements/Conventions that draw a distinction between employees based on salary criteria. 

The salary must be paid in national currency. Payment in foreign currency is prohibited. 

The salary for work done in a given month must be paid not later than the 5th working day of the following month – art. 459 of the CLT – which period cannot be exceeded. Commission and gratuities may be paid over longer periods, depending on what is stipulated in the contract.

Foreigners who come to Brazil to work, with a visa granted by the Brazilian government, and who continue to receive remuneration abroad, must declare their situation to the authorities and must pay, depending on the type of visa and/or the length of time they remain in national territory, income tax on the money received outside Brazil. The Brazilian company that applied for the visa must take into consideration the amounts paid abroad, invariably by a company forming part of its economic group, as a basis for calculating FGTS and the welfare contribution. 


12.4.1. Utilities (Payment in Kind)

The salary may also be paid in utilities – art. 458 of the CLT. The law provides that a minimum percentage of 30% must necessarily be paid to the employee in money. 


Clothing, Equipment and other Accessories

Salary is only payable in kind when paid in consideration for services rendered by the employee and as an alternative to paying him the amount of money necessary for the purchase of the item in question. 

Clothing, equipment and other items provided for execution of the work in no way constitute payment of salary in kind – paragraph 2, I, of art. 458 of the CLT. 

It is necessary for the company to draw up appropriate documentation, stipulating clear rules for the use of these items, prohibiting their private use by the employee or charging for their use, precisely to avoid the configuration of any of these items as indirect remuneration or time on standby and payment of overtime. 

The use of a corporate e-mail constitutes a work tool and, as such, the employer may limit the use of this means of communication to exclusively professional matters and have access to the content of messages sent by the employee. Similarly, access to websites unrelated to the professional activity and knowledge of the sites consulted is prohibited.



The transportation voucher granted by the employer for the employee’s journey from home to work and vice versa, as provided in specific legislation, is not of a salary nature.

However, many companies and many trade unions have altered the terms of the law, without having the power to do so, with companies, for example, not deducting the percentage relating to the employee (6%) or with unions introducing, in their collective agreements or conventions, clauses determining the payment in cash of this benefit, situations not allowed by law, but accepted in many cases by the courts, as long as the correct destination of the benefit is proved.

Still with regard to this issue, if the company provides a vehicle to its employees, usually to those who travel on business and/or for its representation, this will not constitute indirect salary. Precedent no. 367 of the Superior Labour Court excludes the salary nature of the vehicle, even if it is used for private purposes by the employee, including during vacations, weekends and public holidays. The fiscal and social security legislation do not conform to this view, and it is therefore essential to analyze in depth the reason for granting the item in question and the legal treatment to be given to it, in order to avoid the creation of a long-term liability.



Meals granted to the employee by the employer, as part of the Worker’s Food Program (PAT), are not of a salary nature.

In order to be included in the PAT, the company must register in the system, comply with the legal requirements and validate its classification periodically, further justifying its tax incentive.

The Labour Reform extended the exemption for all meal allowances, prohibiting, however, payment in cash. 

During the year 2022, Law 14.442 was enacted, amending the PAT legislation, in order to:

– limit the amounts paid by the employer by way of meal vouchers to meals in restaurants and similar establishments or for the acquisition of food products in commercial establishments,

– prohibit the requirement or receipt of any type of discount or imposition of discounts on the agreed value, onlending or payment terms that disfigure the prepaid nature of the amounts to be made available to the workers or other direct or indirect amounts and benefits of any nature not directly linked to the promotion of the worker’s health and food safety, in relation to the contract signed with companies that issue documents for the payment of food allowance,

– sanction the inadequate execution, deviation or distortion of the purposes of the PATs by the beneficiary legal entities or by the companies registered in the Labour Ministry with: pecuniary penalty, with the cancellation of registration of the beneficiary legal entity or of registration of the companies linked to PATs registered in the Labour Ministry, and with the loss of the beneficiary legal entity’s tax incentive.



In order for a housing allowance to constitute salary in kind, it must be granted for the performance of the employment contract, as is the case of construction site workers in distant places and without structure, or the caretaker of residential condominiums.

If the housing allowance does not meet this need, it will be treated as indirect remuneration and, as such, will form part of the remuneration of the employee for all purposes, as is the case of expatriates.


Abonos (Bonuses for compensation of salary losses)

The unions have adopted the practice of including the payment of bonuses as a form of compensation for salary losses, in addition to the base-date increases.

In essence, they formerly constituted salary advances and formed part of the remuneration.

The Labour Reform definitively eliminated the salary nature from this payment, removing it from the labour contract and from the basis for calculating any labour or social security charges.


Additional payments 

Salary increases that aim to “compensate” for work carried out in adverse conditions. Compulsory additional payments: overtime, night-work, unhealthy/dangerous conditions, and transfer. They are cumulative, with the exception of additional payments for unhealthy/dangerous conditions.

Unhealthy activities are considered to be those that, due to their nature, condition or method of functioning, expose the worker to agents that are harmful to health (noise, heat, cold, vibrations, ionizing and non-ionizing radiation, aerodispersoids, gases and vapors, chemical and biological agents etc.), above the tolerance limits set by reason of the nature and intensity of the agent and the time of exposure to its effects. The unhealthy activity gives the employee the right to a salary increase, according to the degree of insalubrity, set according to norms of the Ministry of Labour, of 10%, 20% or 40% of the minimum salary.

Activities or dangerous operations are those that by their nature or method of functioning involve permanent contact with inflammable substances, explosives, electric power, robbery or other types of physical violence in the professional activities of personal security or property protection, under conditions of serious risk, and workers on motorcycles. The dangerous activity gives the employee the right to additional payment for dangerous working conditions, the value of which is 30% of the base salary received by the employee.

On termination of the factors that give rise to these additional payments, the latter may be eliminated, except in the case of habitual overtime, when the company must pay an indemnity corresponding to the value of one month of the hours eliminated for each year or fraction of six months or more of services in excess of normal working hours.


Expense Allowance and Travelling Expenses

Both items are paid to reimburse expenses incurred by the employee to carry out his activity. Even though habitual, they will not be included in the work contract for any purpose, will not form part of the employee’s remuneration and do not constitute a basis for calculating any labour or social welfare charge. 

In relation to the expense allowance, however, the tax and social welfare legislation exempts this item from the usual contributions, if it is paid once, by reason of the employee’s change of residence.

Any travelling, meals and lodging expenses, paid by employers to their employees as a result of their work activities, are not subject to withholding or subsequent incidence of income tax, and are considered exempt. “Per diem” travel allowances, provided specific conditions are met, are included in this exemption.

In this case, the business trip must be proved by presentation of the ticket or invoice and a receipt from the hotel establishment, in which the name of the employee, his actual dislocation, as well as the amounts paid by the employer, must be included.

Thus, the understanding has prevailed that it is not necessary to prove all the per diem expenses, but rather the effective displacement of the employee. DISIT/SRRF04 Consultation Solution no. 4007/2019 indicates this understanding:




The daily allowances paid exclusively to defray the employee’s food and lodging expenses for occasional services performed in a municipality other than that of the work headquarters, even abroad, are exempt from income tax, provided the conditions prescribed in the rules governing the matter are met. CONSULTATION SOLUTION LINKED TO CONSULTATION SOLUTION NO. 73 – COSIT, OF DECEMBER 31, 2013. Legal Provisions: §2 of art. 457 of Law no. 13.467, of 2017; item II of art. 6 of Law no. 7.713, of 1998; item XIII of art. 39 of Decree no. 3000, of 1999; item II of art. 5 of IN SRF no. 15, of 2001; CST Normative Opinion no. 10, of 1992; §2 of art. 457 of MP no. 808, of 2017.

In any case, certain conditions must be observed in order to avoid the said exemption from being questioned (CST Normative Opinion no. 10/92), such as:

  1. “that the amounts paid for this purpose comply with the criteria of reasonableness, not only in relation to the prices in effect at the place where the service is provided, but also in relation to the positions and salary structure of the legal entity;
  2. that the allowances are not intended to compensate for expenses incurred by non-employees;
  3. that correspond to food, lodging and related expenses at the place where the occasional and temporary services are rendered;  
  4. that, at any time, the legal entity that paid the allowance and posted it in its books as an operational expense, can prove the displacement and the overnight stay(s), if any, that originated its payment;
  5. the proof referred to above must be made by presenting the ticket or invoice for the service and the receipt of the hotel establishment, if the trip includes overnight stay(s). These documents must include the name of the employee, and it is also necessary that the legal entity maintain internal reports that show the amounts paid as daily allowances to each employee who received them”.



Commission constitutes a percentage of results achieved by the employee or by the company, normally paid to employees in the commercial and sales area. 

Commission may be paid as an exclusive form of remuneration (solely as a commission agent), constituting an exception to the general rule of payment, the employee being guaranteed receipt of a minimum salary or wage floor of the category of worker to which he belongs in the event targets are not met.

The percentages paid to the employee, during the course of the employment relationship, cannot be reduced, under penalty of an illegal alteration of the work contract, expressly prohibited by law.



Payment made to the employee as an act of liberality of the employer, in recognition of some act performed by the former. 

Pursuant to current legislation, legal gratifications acquire a salary nature, by reason of paragraph 1 of article 457 of the CLT. 

Companies instituted the payment of gratifications in processes involving dismissal of their employees. If it is only one payment, as a result of the contractual termination, it will not have a salary nature for labour and social security purposes. It will be the basis for calculation of income tax. If it results, however, from an official voluntary termination program, it will not even be subject to income tax.


Premiums and Bonuses

The Labour Reform innovated in this area, starting to regulate premiums, defining them as liberalities granted by the employer in the form of goods, services or cash value to an employee or group of employees, due to performance higher than ordinarily expected in the exercise of their activities.

The premiums are not part of the employee’s remuneration, are not included in the employment contract and do not constitute a basis for the incidence of any labour and social security charges.

For this purpose, the elements set forth in §§ 2 and 4 of article 457 of the CLT must be present: i) payment only for employees with an employment relationship, ii) in the form of goods, services or money, iii) by liberality (even if established by contract, company policy or collective rule), iv) performance higher than that ordinarily expected in the exercise of the activities, the parameters of which will be defined by the employer.

The employer’s liberality and the parameters for setting the outstanding performance acquire extreme relevance, as it has been used by the Brazilian Federal Revenue Service for the purpose of transmuting the legal nature of the premium awarded, as per the position consolidated in COSIT Solution 151/2019.

In fact, the Brazilian Federal Revenue Service has adopted the position that the existence of a formal award (in agreements, contracts or internal policies) would de-characterize the employer’s business liberality and disqualify the payment from the exemption granted by the said provisions. Along the same lines, the proof of the performance expected and the performance surpassed by the employee. In particular, the first criterion has been the target of much criticism by specialists, on the grounds that the Brazilian Federal Revenue Service, by setting parameters for the definition of liberality, exceeded the limits of its action and legislated on a matter foreign to its competence, which is forbidden.

In any case, in opting to use the premium model, under this new concept, the company must include it in the payroll and offer the amount to taxation only for individual income tax purposes, and not for FGTS and social security contributions, due to the express provision contained in §2 of article 457, already mentioned, and Law 8212/1991, article 28, §9, item z:

Ҥ9 РThe following items do not form part of the contribution salary for the purpose of this Law, exclusively:

      1. z) premiums and bonuses”.


Profit sharing

This is the payment made to the employee resulting from the distribution of profits achieved by the employer, obtained with the collaboration of the employee, who achieved the intended goals.

It is implemented through negotiation between employer and employees, through a commission chosen by the latter, consisting also of a representative of the trade union. The purpose of the union’s participation is to implement the collective negotiation.

Legally profit sharing is of an indemnity and participatory nature, and is conditional upon the occurrence of profits or results. If this condition is not fulfilled, it is not paid. However, if there is a loss, the employee does not participate.

Profit sharing is distinct from remuneration, and represents neither a replacement nor a supplement thereof. Since it is not treated as remuneration, it is deemed to be of an indemnity nature, is not subject to FGTS and social security contribution, and is not reflected in the other contractual items. It will be subject to the withholding of income tax, by means of taxation separate from habitual earnings and at special rates.

In the event of a deadlock, the parties must opt for mediation and arbitration, and not for the Labour Court, which can only be activated, if all previous attempts have been exhausted.


Diverse Benefits: schooling allowance, medical and dental insurance, life insurance and complementary retirement plans, scholarships etc. 

The labour law excludes from remuneration: 

– education, in the company’s own teaching establishment or school belonging to third parties, including the cost of matriculation, monthly fee, annual fee, books and didactic material.

The labour legislation only excluded this benefit from the remuneration, without specifying conditions for this.

The social security legislation, however, excludes from the remuneration the professional training and qualification courses linked to the activities carried on by the company, which are not used in substitution of salary and are offered to all employees and managers.

The tax legislation excludes from the basis of calculation of income tax only the donation received to carry out studies or research, the results of which do not represent a financial advantage for the donor, or consideration for services, a situation in which the benefit usually granted to employees rarely fits.

– transport for purpose of travelling to work and back, whether or not the route is served by public transport – matter already addressed

– medical, hospital and dental care, provided either directly or through health insurance

The Labour Reform has extended the exemption to include also the cost of medical or dental care provided by the employer itself or an outside entity, including reimbursement of expenses with medicines, spectacles, orthopedic appliances, prosthetics, orthotics, medical and hospital expenses and the like, even when granted in different types of plans and cover. This does not form part of the employee’s salary for any purpose nor the contribution salary. The amendment was so significant as to impute new wording to the social security legislation to exclude such payments from the basis of calculation of the contribution of this nature.


Equal pay and substitution

The Labour Reform changed the concept of equal pay. Employees of the same company, working in the same establishment (and no longer in the same locality), perform the same function, with equal productivity (quantity) and technical perfection (quality), with a difference in time of service and function of not more than four and two years respectively, must necessarily receive the same salary.

 In cases of substitution, the substitute is also entitled to the salary of the person for whom he is substituting, while the substitution lasts. It is not a question of equal pay, but of ensuring equal pay for equal work.

13th salary

This is a Christmas gratification, payable not later than December 20, regardless of the employee’s remuneration, and is equivalent to 1/12 of such remuneration per month worked or fraction of 15 days.


Transfer of employee

Transfer is the relocation of an employee to a place other than that stipulated in the contract.

Under Article 469 of the CLT, which regulates the issue, the employer cannot transfer the employee without his consent. The removal is not considered a transfer when it does not entail a necessary change in the employee’s domicile, that is, if the transfer to another location does not cause the employee to move his residence.

Another aspect, also relevant, is that the transfer must result from a real work necessity, which is defined as the impossibility of the company to develop its economic activity without the transfer of the employee to a location other than the one for which he was hired.

Employees who hold positions of trust are not included in the protection of the law, and cannot oppose the decision of the employer (§1 of art. 469 of the CLT), but have all the rights guaranteed to the others.

The closing down of the establishment where the employee works is an accepted cause for his transfer, without the need for the above mentioned cause (real work necessity). That is, if the establishment for which the employee was hired to work ceases to exist, the company is authorized to transfer him in order to keep him working. The law states: “The transfer is lawful when the establishment where the employee works closes down.”

An aspect that is very difficult to determine is when a transfer is provisional. It is generally understood that a provisional transfer is one in which the employer transfers the employee temporarily to a place other than that stipulated in the contract, because of some important fact (to fill in for someone’s absence, to assemble certain equipment etc.) that requires such a transfer.

The employer does not intend to make the employee permanently remain in this position, but only provisionally. The temporary nature of the change means that the employee is not definitively established at the place to which he was transferred. The intention therefore is that he should return to the original location.

On a definitive transfer, the employer intends that the employee remain until the end of the employment contract at the new location. The employee relocates with the certainty that, at least as long as his work contract with that company lasts, he must organize his personal and professional life there.

Only a provisional transfer guarantees the employee the right to receive the additional transfer payment (issue to be addressed in a specific item). A definitive transfer does not give the employee such right.

For each employee transferred provisionally, the employer must pay him the additional transfer compensation, equivalent to 25% of the salary received in the place where he was hired. The additional payment will only be due for as long as the transfer lasts. After his return to the place of origin the right to the additional payment ceases (§3 of art. 469 of CLT).

All expenses arising from the transfer (provisional or definitive) of the employee and his family (relocation, transportation, rent etc.) must be borne by the employer. The additional expenses arising from a transfer that does not entail a change in the employee’s domicile must also be borne by the employer. This is the rule stipulated in article 470 of the CLT: “The expenses resulting from the transfer shall be borne by the employer”.



The guarantee of employment protects the employee against arbitrary or unjustified dismissal, for as long as the situation persists, and prevents the employer from terminating the work contract. This is a very important topic as regards personnel management within companies, since it can lead to important and substantial procedural and financial liabilities.

Among various factors that guarantee stability of employment, we would draw attention to the following: employee elected to the position of director of internal commissions for accident prevention, from the registration of his candidacy until one year after the end of his term; pregnant employee, from confirmation of the pregnancy until five months after giving birth; trade union official, from his candidacy until one year after the end of his term of office; injured employee, until one year after termination of the accident sickness benefit; member of the internal staff representation commission during his term of office and up to one year after termination, re-election in the two subsequent periods being prohibited.

In addition to these, some conventions and collective bargaining agreements also provide instances of guaranteed employment, such as a minor at the age of military service, employee injured at work or suffering from an occupational disease, for a given period for the workers of a company etc.

In addition to these guarantees, TST Precedent 443 considers discriminatory the dismissal of an employee who is HIV-positive or has some other serious disease that gives rise to stigma or prejudice. Accordingly, the contractual termination is considered invalid and the employee must be reinstated in his job.

Law 9029/1995 also prohibits the adoption of any discriminatory and restrictive practice for the purpose of granting access to an employment relationship, or the maintenance thereof, due to sex, origin, race, colour, marital status, family situation, disability, professional rehabilitation, age, among others, and establishes that the termination of a labour agreement, due to a discriminatory act, guarantees the employee the right to choose between job reinstatement, with full compensation for the period of absence, or the receipt of double remuneration for the same period, without prejudice to non-economic compensation.



A work contract can be terminated either by the employer or the employee, and also by decision of both parties.

The employment relationship will be terminated by the employer with the dismissal of the employee, with or without just cause. In the former case the employee forfeits the right to labour indemnities (for having committed a serious fault), which are fully assured in the second case. The Labour Reform also added a new method of application of just cause to employees to the existing list: an employee who loses his professional qualification or fails to meet the legal requirements for the exercise of his occupation may be dismissed for just cause, in cases where such qualification is an essential requirement for him to exercise his activities and provided that he acted with willful intent.

The employment relationship will be terminated by an employee by handing in his notice or resignation, or by indirect termination of the work contract. In the first case, the employee is not paid labour indemnities; in the second case he is entitled to such indemnities, particularly as a punishment to the employer, who was guilty of some fault.

The employment relationship will be terminated by agreement of the parties, when both agree as to the conditions of the termination.

Prior notice is the manifestation of will of the party who intends to terminate the contract. It usually corresponds to one month of work. An employer who does not want the employee to remain on its premises during the notice period may indemnify him in respect of such period; this will have repercussions on the work contract for all purposes, that is, calculation of vacation, thirteenth salary, FGTS etc.

To the period stipulated in the previous item, 3 days for every year worked by the employee are added, subject to the limit of 90 days (in which the prior notice of 30 days is already included). This constitutes mere financial reparation, and does not count as time actually worked.

There are collective agreements that stipulate a differentiated period of notice, taking into consideration the length of time the employee has worked for the company, among other factors.

In contracts with expatriates, it is common to have longer notice periods. According to Brazilian law, if the employer decides to waive the employee’s compliance with the notice period, it must pay for the whole contractual period, as it is a more favorable rule. The employee, in the event he hands in his notice, is not obliged to work for the full period.

Innovation introduced by the Labour Reform in the Voluntary or Incentivized Dismissal Plans for individual, multiple or collective dismissal, provided for in collective labour agreements or conventions, which will result in the full and irrevocable discharge of the employment contract, preventing the employee from filing a labour claim, unless expressly provided otherwise.

The new CLT also abolished the compulsory assistance of the trade union on termination of the labour contract and its ratification. According to the text, the act of rescission by the employer, with annotation in the workbook, will be sufficient for release of the forms necessary for the employee to receive unemployment insurance and withdraw his FGTS. Unemployment insurance is the benefit paid, for a limited time, to a worker dismissed without just cause, equivalent to 3 or 5 installments calculated on the average of the last salaries received, variable according to the length of time worked, and paid by Social Security.

The CLT further included the possibility of an agreement between the employee and the employer to terminate the employment relationship. In this case, the employer can pay half the notice (if indemnified) and the penalty. The worker may also withdraw 80% of the FGTS, but will not be entitled to unemployment insurance.

Special attention and care must be given to this type of termination of the employment relationship, when the parties agree or the employee states his intention of remaining linked to the ex-employer’s health insurance policy at his own expense, when he contributes to the cost of this benefit, as provided in art. 30 of Law 9656/1998, since healthcare operators are not recognizing termination by mutual agreement as dismissal without just cause, the only situation that authorizes this legal option.

The STF promises, for 2023, the judgment of Direct Unconstitutionality Action (ADI) 1.625, which deals with the invalidation of Decree no. 2.100/1996, whereby the then President of the Republic, Fernando Henrique Cardoso, made public the denunciation of Convention no. 158 of the International Labour Organization (ILO), which deals with termination of the employment relationship. A lot of commotion has been caused by the news of the judgment of this case, with many people claiming that the granting of the action would lead to the immediate prohibition of dismissals without just cause by employers, which is not true. It is worth pointing out, to the ILO itself, that the Convention was validly denounced by Brazil, and such information is included on its website.



The employer is forbidden to make any deductions from the worker’s salary, except when these result from advances, legal provisions or a collective contract.

Where the damage is caused by the employee, the deduction is lawful, provided that this possibility has been agreed to or in the event of willful misconduct by the employee.

The Labour Reform established that both the employee and the employer may be entitled to non-economic damages in the event of offence against the following:

  1. Honour, image, intimacy, freedom of action, self-esteem, sexuality, health, leisure and physical integrity are the legally protected assets inherent to the individual.
  2. Image, trademark, name, business secrets and secrecy of correspondence are legally protected assets inherent to the legal entity.

The non-economic damage may be accumulated with that of a pecuniary nature arising from the same injurious act. Although the labour reform has established a ceiling for the amount of compensation, based on the degree of offense (light, medium, serious and very serious), the Federal Supreme Court, on judging three Direct Actions of Unconstitutionality (ADINs) nos. 6050, 6069 and 6082, ruled for the constitutionality of §1 of article 223-G of the CLT, emphasizing that it is a mere legal parameter, maintaining the discretion of the judge, who may even determine an amount different from that provided by law.



The Labour Reform seriously affected the trade union structure, that was and will remain for some time oversized. There are about 17,000 unions in Brazil representing employees and employers.

The new CLT establishes, in article 611-A, that the collective labour and/or collective bargaining agreement will prevail over the law in 15 different points, such as participation in profits and results, remuneration for productivity, working hours, hour bank, minimum interval for meal and rest of half an hour, exchange of public holiday, telecommuting, notice and intermittent work, positions and salary plan and adhesion to unemployment insurance. The degree of insalubrity and the extension of working hours in insalubrious environments may also be negotiated, without prior permission from the Ministry of Labour.

In negotiations regarding reduction of wages or working hours, there must be a clause providing for the protection of employees against dismissal during the term of the agreement. Such agreements need not provide for consideration for a specific negotiated item.

It is important to state that article 611-B of the CLT prevents the negotiation of 30 items of the employment relationship, prohibiting, for example, negotiation for the reduction or elimination of rights such as FGTS, 13th salary, minimum salary, remuneration for night work higher than for work during the day, weekly paid leave, maternity and paternity leave, prior notice, retirement, accident insurance, right to strike and take action, among others.

With the labour reform, the prevalence of the Collective Agreement (negotiation between company and union) over Collective Conventions will be guaranteed, granting significant importance to the unions when negotiating contractual conditions for the category they represent.

Although it intended to give prominence to trade unions in the negotiation of working conditions, the Labour Reform made the union contribution optional and conditioned its discount to the prior and express authorization of those who participate in a particular economic or professional category, or a liberal profession, which gave rise to a profound change in the financial reality of the unions and in the conduct of collective negotiations. . The issue was submitted to the Federal Supreme Court in Direct Unconstitutionality Action (ADI) 5794, in 18 other identical actions filed against the new rule, and in Declaratory Action of Constitutionality (ADC) 55, the object of which was precisely the opposite, i.e. recognition of the legal validity of the legislative change. The constitutionality of the change was recognized by the STF and therefore the interpretation that the contribution to unions is optional and must comply with the formalities provided by law remains in force.

Nevertheless, a relevant change has occurred in this scenario, in Issue 935 under discussion before the STF (Leading Case 1018459), which discusses the unconstitutionality of the assistance contribution imposed by the union on non-member workers, since the Reporting Justice, changing his original decision, expressed his opinion that such a charge is constitutional, provided that the right to object is ensured.



In the scope of employment relationships, the LGPD is unquestionably present in its three phases, the pre-contractual, contractual and post-contractual, although it has not been subject to specific regulation. In addition to the direct relationship between the company, the candidates for job vacancies it offers and its own employees, the LGPD is also present in relationships with employees of outsourced companies.

In the pre-contractual phase, companies are obliged to adjust their recruitment and selection processes, deciding whether to dispose of unused resumes or keep them in their database for future vacancies, with the express consent, in the latter case, of the candidate. Companies must also consider that recruitment and selection processes may be subject to investigation by the competent authorities and/or judicial discussion by these same authorities or by the candidates themselves, in which case the processing of candidates’ data may constitute evidence for their defence, and the regular exercise of rights.

In the course of the employment relationship, the applicability of the LGPD is vast, since the employer is required to provide personal data, including sensitive data, of its employees for the fulfillment of legal obligations, such as for the e-Social, for the DCTFWeb, for the CAT, for the mandatory Occupational Health and Safety Programs, for the tax auditors of the Ministry of Labour and the Federal Revenue, trade unions and class entities, among other purposes.

The employer also uses the data of its employees to fulfill contractual obligations, such as for the provision of benefits, health and life insurance, agreements in general with other companies etc., thus constituting a regular exercise of rights, which, strictly speaking, exempts the employer from obtaining the employee’s express consent, provided, of course, that such benefits are in the employee’s interest or result from a regulatory provision.

The employer may also be obliged to use such data in administrative or judicial proceedings, by determination of the supervisory agency or the judge. In such cases, it is not necessary to have the authorization of the data subject for the provision of such information, since this undoubtedly constitutes the regular exercise of a right.

In the event of a work-related accident or health problems that justify the adoption of measures by the employer for the protection of the life and physical integrity of the data subject, the company would also be processing his data, without the need for consent.

We cannot fail to mention, albeit briefly, the question of the employee’s consent, since a position has already been formed, not only in Brazil, but also abroad, regarding its inapplicability, as a rule, to employment relationships, given the worker’s condition of “hyposufficiency”, which, as has already been stated herein, does not apply indiscriminately in Brazilian labour law, since the legislation in force expressly recognizes and regulates the notion of the “hypersufficient” employee. 

Once the employment relationship ends, strictly speaking, the employer should eliminate the employee’s personal data, since their purpose has been achieved or they are no longer necessary. However, considering that much of this data may be subject to analysis by the Brazilian fiscal authorities and/or constitute evidence in lawsuits that may be filed against the company, including by the employee himself, they may be retained, for compliance with legal obligations or for the regular exercise of rights, for as long as they may be required, situations which once again exclude consent by the data subject.

The retention period could, in principle, be standardized according to the two and five-year periods applicable to the employment relationship. However, there are situations that may exceed these periods, such as occupational accidents (including professional and occupational illnesses), death of a worker with minor heirs, and declaratory actions asserting the employment relationship, which should be considered when setting the parameters for the custody and destruction of data by the employer.

But that is not all; among the numerous obligations set out in the special legislation, the LGPD determines the existence of a personal data controller, someone appointed by the company who will basically be responsible for the communication between the latter, the data subject and the ANPD (National Data Protection Authority), which oversees compliance with Law no. 13.709/2018 – General Law on Personal Data Protection (LGPD).

Article 41 of the LGPD obliges all companies to appoint a personal data controller, also known as Data Protection Officer (DPO) under European law.

However, the ANPD has exempted small data processors, such as micro-enterprises, small businesses, startups and non-profit legal entities, natural persons and unincorporated entities. If these small processors do not appoint a data controller, they will have the obligation to provide a communication channel with the data subject.

In accordance with the paragraphs of the said article 41, the DPO is responsible for 1) accepting complaints and communications from data subjects, providing clarifications and taking appropriate action, 2) receiving communications from the national authority and taking appropriate action, 3) instructing the entity’s employees and contractors as to the practices to be followed with regard to the protection of personal data, and 4) performing other duties as determined by the controller or established in supplementary regulations.

The DPO can be an employee of the company or outsourced. If it is possible to hire an external DPO, the company’s employees can focus on its core-business, and avoid becoming overloaded or even having their employment contracts distorted, which may attract legal consequences, such as the payment of additional compensation for deviation from the original function or dual function.  Logically, this caveat does not apply to a company that hires a DPO exclusively to perform this activity, since this will be the object of his contract.



Law no. 14457/2022 instituted the Employ + Women (Emprega + Mulheres) Program. This program aims to insert and maintain women in the labour market, through the implementation of various measures, including support for parenthood in early childhood, with the payment of daycare reimbursement and maintenance or subsidy of institutions for early childhood education by the independent social services (SESI, SESC and SEST).

The requirements for payment of the day-care reimbursement are stated in art. 2 of the Law, including the age of the children – up to 5 years and 11 months.

The amounts paid as daycare allowance are totally exempt for labour, social security and tax purposes and are not incorporated into the beneficiaries’ employment contract. Employers that choose to adopt daycare reimbursement for all employees who have children within the age range referred to in the preceding paragraph are not required to install an appropriate place for the care and assistance of employees’ children during the lactation period.

An act of the Executive Branch, regulating limits of amounts and methods of providing services, is still to be enacted.

The implementation of the daycare reimbursement (conditions, terms and amounts) will be conditional on the formalization of an individual agreement, collective bargaining agreement or collective labour agreement.

The amount paid as daycare reimbursement is not of a salary nature, is not incorporated into the remuneration for any purpose, nor does it constitute a basis for calculating social security contributions, income tax or FGTS.

Establishments where 30 or more women over the age of 16 work must have an appropriate place to keep their children under surveillance and assistance during the lactation period, unless they adopt the day-care reimbursement benefit.

The support for parenting may also take the form of more flexible work and vacation schedules. Employees with children, stepchildren or children under legal custody aged up to 6 years old or disabled people (no age limit) should be given priority in the occupation of vacancies that admit telecommuting, remote or long-distance work. They will also have priority in the granting of measures that aim to reconcile work and parenting, including part-time work and the 12 x 36 system, time bank, flexible entrance and exit times, and anticipation of individual vacations.

The Law favours measures to encourage the professional advancement of women, such as the suspension of the work contract for qualification, pursuant to art. 476-A of the CLT, with the possibility of receiving a professional qualification scholarship and, depending on the employer’s decision, a monthly compensatory allowance of an indemnity nature.

If the employee is dismissed during the suspension period or in the 6 months following her return to work, the employer will pay her, in addition to the indemnity installments provided for in the legislation, a penalty to be established in a collective agreement, which will be at least 100% of the value of the last monthly remuneration prior to suspension of the work contract.

In support to a mother for her return to work after the end of her maternity leave, upon formal request of the interested male employee, the employer may suspend, pursuant to art. 476-A of the CLT, the work contract of a male employee with a child whose mother has terminated the maternity leave period, in order to provide care, establish bonds and monitor the development of the children and support the return to work of his wife or partner.

Suspension of the work contract will be effective after the end of the maternity leave of the employee’s spouse or partner.

The employer must disclose and guide its male employees regarding the possibility of suspending their employment contracts with qualification, in order to support the return of their wives or partners to work after the period of maternity leave. It must also promote periodic awareness programs on responsive and equal parenting to boost the adoption of the measure by its employees.

The extension of 60 days of maternity leave under the Citizen Enterprise Program may be shared between the female employee and the male applicant employee, provided that both are employees of a legal entity that adheres to the Program and that the decision is adopted jointly, in the manner established in the regulations. The extension may be used by the male employee of the legal entity that joins the Program only after the end of the maternity leave, provided that it is requested 30 days in advance.

The company participating in the Citizen Enterprise Program may replace the maternity leave extension period with a 50% workday reduction for a period of 120 days, provided that the salary of the male or female employee is paid in full and an individual agreement is signed between the parties for the adoption of this measure.

The said law also determines that employers obliged to have an Internal Commission for the Prevention of Accidents (CIPA) must adopt a series of measures to promote a healthy and safe work environment that favours the inclusion and maintenance of women in the job market. The name of CIPA was changed to add the word “Harassment” and it is now called the Internal Commission for the Prevention of Accidents and Harassment.

Companies therefore that are obliged to have a CIPA must:


  1. Include rules of conduct regarding sexual harassment and other forms of violence in the company’s internal rules, with wide dissemination of its content to male and female employees;
  2. Establish procedures for receiving and following up on complaints, for investigating the facts and, when applicable, for applying administrative sanctions on those directly and indirectly responsible for acts of sexual harassment and violence, guaranteeing anonymity for the person making the complaint, without prejudice to applicable legal procedures;
  3. Include issues relating to the prevention and combat of sexual harassment and other forms of violence in CIPA’s activities and practices; and
  4. Carry out, at least every 12 months, training, orientation and awareness programs for male and female employees of all seniority levels in the company about topics relating to violence, harassment, gender equality and diversity in the workplace, in accessible and appropriate formats to ensure maximum effectiveness.

The Law in question created the Emprega + Mulher Seal, the objective of which is to recognize companies that stand out for their organization, maintenance, and provision of day-care centres and kindergartens to meet the needs of their female and male employees, in addition to good corporate practices that aim, among other objectives, to stimulate the hiring, occupation of leadership positions and professional advancement of women, especially in areas with low female participation, such as science, technology, development and innovation; equal division of parental responsibilities; promoting a culture of equality between women and men; offering flexible work arrangements; granting leave of absence for women and men to allow them to care for and bond with their children; providing effective support for female employees in its workforce and those providing services in its establishment in the event of harassment, physical or psychological violence, or any violation of their rights in the workplace; and implementing programs for the hiring of unemployed women in situations of domestic and family violence and for the reception and protection of its female employees in situations of domestic and family violence.

Companies that qualify for the Emprega + Mulher Seal must report annually on their compliance with the requirements of the Law.

Author: Maria Lúcia Menezes Gadotti – partner responsible for labour law area of Stüssi-Neves Advogados

Stüssi – Neves Advogados

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