Key:
Reforma Trabalhista - Labor Law Reform
Lei nº 13.467/2017 - Law no. 13.467/2017

On July 14, 2017, Law 13.467/2017 was published in the Official Union Journal, making the amendments popularly referred to as the “labor law reform” official.

Law 13.467/2017 formalizes and triggers the implementation of around one hundred amendments to the Consolidated Labor Laws (CLT), in addition to amending Law 6.019/1974 (Temporary Labor and Outsourcing), Law 8.036/1990 (Employee Time of Service Guarantee Fund - FGTS) and Law 8.212/1991 (Social Security).

Below, we highlight some of the main changes:

• Collective rules: several issues may be subject to collective bargaining, and the terms agreed between the parties will take precedence over what is provided for in the legislation.
• The role of the Labor Courts: the collective rules (agreements and conventions) may be subject to scrutiny by the Labor Courts; however, the role of the courts shall be to abide by the conditions of the legal deal, respecting the independence of the collective will.
• Vacations: provided the employee agrees, vacations can be split into up to three periods - one of which cannot be less than 14 calendar days, while the others can be less than five calendar days.
• Time in transit (in itinere): the time an employee spends commuting from home to their work, regardless of the method of transport, will not be computed in the working day.
• 12 x 36 hours working arrangement: the parties may agree, under an individual or collective bargaining agreement to a 12-hour working day, followed by 36 hours of rest, with due regard for the weekly limit of 44 hours worked.
• Telecommuting: the text contains regulations on telecommuting, understood to be work carried out off the company’s premises using information and communication technologies, not to be confused with external work.
• Intermittent contract of employment: Law 13.467/2017 institutes the intermittent contract of employment, understood to be that in which services are provided on a non-continuous basis, with subordination, and governed by hours, days or months.
• Equal pay: the text provides for changes to the parameters that define equal pay among employees by instituting the criterion of up to four years’ service with the same employer and, at the most, two years in the same function. The text also provides for the prevalence of the jobs and salaries plan, waiving any formality involving the validation or registration of the document.
• Dismissal by common agreement: contracts of employment may be rescinded in common agreement between the parties, in which case the employee will be entitled to half of the notice pay, if so compensated, a penalty of 20% on the balance of the FGTS fund and the withdrawal of up to 80% of the amounts deposited, in addition to payment in full of the other severance pay items, apart from access to unemployment insurance.
• Annual declaration of compliance with labor law obligations: the text provides for the possibility of the parties agreeing to an annual declaration of compliance with labor law obligations, with the participation of the Employees’ Trade Union. The declaration shall itemize the amounts paid and will effectively free up the installments mentioned therein.
• Union fees: contributions intended for the unions are henceforth optional.
• Dismissals: dismissals on the employer’s initiative without cause, whether individual or collective, are henceforth equivalent, with no need for intervention by the unions.
• Due cause: dismissal with cause is henceforth also applicable to loss of qualifications or the legal requisites for exercising the profession, when there is willful misconduct by the employee.
• Workers’ representative: companies with more than 200 employees shall ensure the election of a commission with no ties to the unions, for intermediating employer-employee discussions.
• Travel allowances: the new wording of article 28, paragraph 9, letter h of Law 8.212/91 stipulates that the amounts paid to the employee as travel allowances will not be factored in to the calculation of the social security and FGTS contributions, excluding any mention of the 50% limit of the employee’s monthly compensation.
• Medical assistance: the new wording of article 28, paragraph 9, letter q of Law 8.212/91 stipulates that the amounts of which the employees are assured by way of medical and dental assistance will not be factored in to the calculation of the social security and FGTS contributions, excluding any mention of the need for the benefits to fully cover all employees and managers of the company.

During the ceremony that launched the new law, the Brazilian Government presented the draft of the Provisional Measure (MP) it intends to publish in the days ahead to amend several points of the labor law reform - among the suggested amendments, we wish to highlight:

• The 12 x 36 working arrangement will only be valid if negotiated under a collective agreement.
• Self-employed workers cannot provide services solely to the same entity, under penalty of characterization of contract of employment.
• Several issues involving the regulations of the intermittent contract of employment are to be amended.
• The commission representing the workers, to be instituted in companies with more than 200 employees, will not substitute the role of the union entity.
• Employers shall provide employees with proofs of payment of social security and FGTS contributions.

The amendments imposed by Law 13.467/2017 will come into force and effect 120 days following its publication, during which period the labor law routines should be adjusted to the new requirements. If the Brazilian Government published the Provisional Measure in the days ahead, the recently published law may be subject to modifications.

KPMG has a highly-qualified team specializing in labor law and social security issues, which is ready to respond to current demands and deliver results with excellence.

Contact us for additional information:

Marcus Vinicius S. Gonçalves
vslemenian@kpmg.com.br

Valter Shimidu
vshimidu@kpmg.com.br

Regina Moraes
rmoraes@kpmg.com.br