Brazil: Employment Law Basics for a Country with a Robust Labor Market


On June 9, 2011, The Ferretti Group, the Italian luxury yacht manufacturer, announced the inauguration of the new Ferrettigroup Brasil production facility. It was reported in the Financial Times that The Ferretti Group has plans, with the production ability of this new site, to increase its labor force from 600 to 1,000 employees and to enhance its sales in Brazil by 15% over the next few years. The Ferretti Group’s investment in Brazil is an example of the presence of a robust labor market in that country, which has been exceptionally strong in the past few years. Throughout 2010, Brazil's unemployment rate experienced record lows, and in April 2011 Brazil’s 6.4 percent unemployment rate was the lowest for that month in nearly ten years. Employees in Brazil enjoy relatively high salaries due to the demand for skilled workers. Multi-national companies are strong investors in Brazil, South America’s largest nation, which is the world’s fifth-largest country in both geographical size and population. This article will provide some basic information regarding Brazil’s employment laws, with an emphasis on legal requirements of special interest to multi-national employers.

General information on Brazil’s employment laws. Employer’s obligations and employee’s rights in Brazil are found in that country’s Federal Constitution, its Consolidated Labour Laws and provisions of individual and collective agreements. Although written employment contracts are not required in Brazil except for probationary work periods and for certain types of temporary employment, it is general practice for employment contracts to be in writing.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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