The Federative Republic of Brazil is the largest country in South America. Brazil is divided into 26 states and the Federal District, where the capital, Brasilia, is located. The official language is Portuguese, which distinguishes the country as the only Portuguese-speaking nation in South America. Brazil is the largest economy in Latin America. It has a diverse economy and vast deposits of natural resources. Strategic location, vast economic potential and economic stability are considerations for businesses considering expansion into Brazil. Employment contracts in Brazil may be implied, verbal or in writing, although some exceptions apply. The duration of an employment contract can be for a fixed period, an indefinite period or intermittent. The parties to an employment contract can freely negotiate the terms and conditions of the employment contract, but the provisions cannot conflict with the labor law, collective agreements and labor authorities’ decisions.
A written employment contract generally is recommended and should include:
The standard work period in Brazil is 44 hours a week, with eight hours per day for five days and fours hours on a sixth day. Some collective or bargaining agreements may provide for different work hours. Employees are entitled to a minimum of 11 hours of rest between two consecutive work days. Every employee is also entitled to 24 consecutive hours of rest per week, which generally includes Sunday. Employers generally cannot require an employee to work on a Sunday or a public holiday unless an exception applies. Special rules apply for shift work, night work and other special circumstances.
Employees receive 15 days of fully paid sick leave with a medical certificate. After 16 days of sick leave due to illness, employees are entitled to extend the sick leave and receive sick benefits from National Institute of Social Security. The employer is responsible for paying the first 15 days of sick leave and INSS will pay a portion of the employee’s salary after the 16th day.
Female employees receive 120 days of paid maternity leave and male employees receive five days of paid paternity leave. These leaves can be extended in certain cases. While preganant and for a period following the birth, the employee cannot be dismissed. New mothers also receive breaks during work day to nurse their child.
Wages in Brazil generally are paid on a monthly basis. Annual increases are not mandated but are common and typically negotiated as part of a collective bargaining agreement. Employees also receive a 13th-month salary bonus. The right to get the bonus begins after 15 days of work and is payable in two installments. Other allowances, such as a travel allowance, also can be included in an employee’s compensation package.
In addition to public holidays, employees receive 30 calendar days of paid annual leave after one year of service. Vacation days are reduced if the employee is absent from work frequently.
Public holidays in Brazil may be observed at the national, state and/or municipal level. Some recognized holidays are optional or customary.The national and customary holidays for 2021 are:
Brazil has a universal healthcare system, but employers generally offer their employee’s supplementary private healthcare available in the market.
An employment contract can be terminated at the end of the contract term (if for a fixed period), by the employer (with or without cause) or by the employee. Absent cause and outside the probation period, employers must provide notice before dismissing an employee. The notice period can vary depending on the employee’s length of service and the salary interval, but is frequently 30 days. An employer may terminate an employee at the end of a fixed-term contract, which can be no longer than 24 months. If an employee is terminated before the end of the contract term, the employer is required to pay a percentage of the employee’s salary over the remainder of the contract term. In Brazil, severance is coordinated through what is called the Guarantee Fund for Time of Service system. Employers deposit 8% of an employee’s salary into an account on behalf of the employee. The accumulated balance transfers if the employee changes jobs. Employees can access these funds if terminated.
We understand that local laws and regulations change and sourcing an accurate reference guide is not easy. Our data is researched and verified by our team of local international Employment Attorneys, HR and Benefit Professionals and Tax Accountants through our Atlas team and consultants, to ensure information up-to-date and accurate.
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