The “Labor Reform” was approved by the Federal Senate on Tuesday, July 11, 2017, and was sanctioned by the Brazilian Federal President, Michel Temer, two days later, on July 13.
The Labor Reform was subjected both of criticism and approvals, and it was motivated by a great movement in the attempt to update a diploma created in the 1940s for a more current overview. Find below the most significant modifications of the mentioned Reform.
Currently, the labor legislation allows the employee’s working conditions to be negotiated between the employee and his employer, but it does not specify exactly what may be subject of such transaction. The Reform implemented a list of conditions that may or may not be negotiated between employee and employer. In this sense the negotiation between the parties overlaps the legislation.
Among the points that can be modified we can find: the working period; the annual leave; the break for lunch during the working hours; the registration of hours in the worked hours register; among others. Regarding the points that are not negotiable, there are: the obligation to pay at least one minimum salary to the employee; the right to the 13th salary; the vacation period; the unemployment compensation and the maternity leave.
Some of the points above mentioned have been submitted to other modifications, such as the vacations period. Until the Reform, the Consolidation of the Labor Laws (“CLT”) established that vacations periods could be divided into up to two periods, and one of those periods could not be composed for less than ten days. After the Reform modifications, the vacations periods can be divided in up to three periods, and one of those periods could not be composed for less than fourteen days.
In addition, the lunch break may be reduced from one to half an hour, if it is agreed in collective bargaining agreement.
With regards to the worked hours register, the overtime must be compensated in up to six months, otherwise the employer will be obliged to pay the hours to the employee, by the price of 50% more than the ordinary hours. Furthermore, individual negotiation between employer and employee was allowed regarding the compensation mode of the overtime hours, whereas, according to the CLT, only collective bargaining was allowed.
Regarding the working period, the regime of twelve consecutive hours of work followed by thirty-six hours of rest (12 x 36) was authorized, provided that it was negotiated with the employer in collective bargaining.
For women, the Reform allows pregnant and breastfeeding women to work in unhealthy places, provided that the health hazard is of a minimum or average degree and a medical certificate is presented in which it is allowed for the woman to work during these periods. It is also necessary that the certificate is issued by a doctor of the woman’s trust and not by a doctor of the employer.
The home office has also become a legally authorized institute, and its exact terms must be agreed between the employer and the employee in the work contract. At the same occasion, the responsibilities of each party for the costs and maintenance of the material used for the work performance shall be stipulated.
Another important subject of the Labor Reform is the end of the compulsory union dues both for the employees and the employer. Nowadays, every March, the equivalent of one work day is automatically deducted from the employee’s salary for transfer to the union responsible for its category, while for the employer the tax is calculated as a percentage of its company’s corporate capital. After the Reform, the union dues shall only be paid if the employer and/or the employee want to.
It has also been regulated the possibility of both the employer and the employee formalize a dismissal agreement. Thus, if both parties are in accordance with the labor relationship’s termination, the worker will receive a fine of 20% of the FGTS and can move 80% of the fund, not having the right to unemployment insurance, though. Currently, if the worker resigns or if he is dismissed with just cause, he has no right to withdraw the FGTS’s amount, neither to receive the unemployment compensation nor any fine.
The displacement hours, as known as hours in itinere, have also been modified, since the time the worker remains in transportation provided by the company is no longer considered as work. Thus, shall be considered as working hours only the ones in which the worker is in his workplace.
The amendments resulting from the Labor Reform will become effective in four months, and the President Michel Temer has already expressed that possible adjustments will be made in the future through the publication of Provisional Measures.
Among all the amendments provided in the Labor Reform, we have listed in this article some of the most discussed ones. Our Labor Law team remain at your disposal for any clarifications about these and other amendments.