Employer of Record in Brazil: Hire, Manage, and Pay Talent Seamlessly

Agreements in Brazil

• Brazil has mandatory agreements between labor unions representing the employee and those representing the employer. Failing to comply with these agreements results in fines being levied.
• Certain “Regulated Professions” (such as nurses, lawyers, accountants, etc.) are exempted from this. They are represented by their respective unions and guilds.
• Employee contracts in Brazil are for an indefinite period. Contracts for a fixed period are only considered under special circumstances.

Visa in Brazil

Minimum Wage in Brazil

Annual Bonus in Brazil

Health Benefits in Brazil

• The Brazilian workforce is entitled to healthcare and dental care benefits. Brazil's National Institute of Social Security manages these benefits.
• Health and Dental insurance are regulated by the National Regulatory Agency (NRA). The agency ensures that all insurance providers cover the same final amount and abide by the determined minimum amount.

Working Hours and Overtime in Brazil

• Work hours:The law permits employees to work for 44 hours per week. A typical work day is 8 hours long, post which overtime is considered.
• Break:Employees have a mandatory 1-hour break if their shift exceeds 6 hours.
• Overtime: pay equals 150% of the employee's regular salary. Employees working on a holiday must be paid 200% of their regular salary. This benefit is not extended to employees working from home.
• Holidays: Employees have paid public holidays as stipulated by the Brazilian Government.

Leaves in Brazil

Social Security in Brazil

Taxes for Employers in Brazil

• FGTS (Fundo de Garantia por Tempo de Serviço or Federal Severance Pay Fund) Contribution - 8.0%
• Meal Voucher - BRL 880 (not mandatory but quite common)
• Social Security Contribution (INSS) - 28.8% (including Pension Fund and Public Health Insurance)
• Vacation Bonus - 2.78%
• Holiday Allowance - 8.33%

Probation in Brazil

Termination in Brazil

• If an employer wants to terminate an employee, the employee must receive a 30-day notice, provided the employee has been working for up to 1 year.
• If the employee has worked for more than 1 year, 3 days (in addition to the 30 days) for every year worked (up to 60 additional days) are to be considered in the notice period.
• If an employee wishes to discontinue working for the employer, they are required to give a 30-day notice to the employer. Employees on probation can request a shorter notice period.
• If the termination is by mutual agreement, the notice period is split.
• Some employees are protected from dismissal. Those include -

  • pregnant employees
  • employees suffering from specific illnesses or labor-related illness
  • those representing unions
  • those representing CIPA (Labor Accident Prevention Committee)
  • employees with special needs
  • those under collective contracts

Severance Pay in Brazil

Employees or Contractors in Brazil

• Brazilian law treats employees and contractors as different groups. However, Brazilian Labor Laws apply to both.
• Employers will be subjected to heavy fines in case of misclassification.
• Depending on the short or long-term requirements, a company can hire contractors or full-time employees.
• Employment contracts must be drafted in Portuguese to have legal validity. In case they are drafted in unofficial language, an translation must be provided.
• Contractors are people hired on a project-to-project basis for a short term. They are usually international and not subject to the same taxes as employees and may save money. They are required to file their taxes themselves and the employer need not withhold any tax amounts.
• Full-time employees are people hired for an indefinite or pre-determined period and require benefits, taxes, payroll, etc. This may initially seem costlier, but is a suitable option in the long term.