As the United States battles high unemployment rates amidst announcements of massive layoffs by the country’s largest employers, Brazil is experiencing the lowest unemployment rate in its history. The second largest country in the Americas ranks number one in expected job creation for the last quarter of 2011. Brazil has very strict labor laws, embedded in its Constitution as nonnegotiable fundamental rights. As a result, Brazilian workers enjoy many legal protections that would be considered perks in other countries. Such laws give rise to voluminous litigation in Brazilian Labor Courts, with around 2 million complaints filed every year. This article highlights some of the issues that employers may face when dealing with their workforce in Brazil.
Since labor laws are statutory in nature, labor contracts must fit squarely within their narrow parameters. Employment contracts cannot deviate from the law in any way that waives, releases, or circumvents a worker’s rights. Some employers get creative and choose to frame the relationship as that of an independent contractor, rather than an employee. However, structuring the relationship in that manner has little effect if a Labor court finds that the independent contractor was in fact performing activities of an employee as legally defined. Courts will consider variables such as work hours, place of work, subjectivity to the employer’s administrative rules, reporting requirements, and compensation, among others, in determining whether the individual is indeed an independent contractor or in fact an employee. Unfortunately for companies, courts tend to favor protecting the employee and usually grant whatever statutory benefit for which the individual has petitioned.
Please see full article below for more information.
Firefox recommends the PDF Plugin for Mac OS X for viewing PDF documents in your browser.
We can also show you Legal Updates using the Google Viewer; however, you will need to be logged into Google Docs to view them.
Please choose one of the above to proceed!
LOADING PDF: If there are any problems, click here to download the file.