Understanding Employment Norms in Brazil: A Comprehensive Guide
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Hiring in Brazil? ? Read on to find out the employment norms (like taxes, payroll and benefits) and EOR (Employer on Record) norms in Brazil?

Employment Norms in Brazil

Brazil is a top destination for job holders due to the employee benefits offered in the country. It is the 9th largest economy in the world. Ensuring the legal compliance of employment may be a challenging task for employers who do not have access to a legal entity. EOR (Employer on Record) services bridge this gap and ensure legal compliance. EOR can handle all payroll-related processes, taxes, HR, and employee benefits, allowing companies to focus on high-priority goals.

General Information:

  • Real (R$, BRL) is the currency recognized in Brazil.
  • Brasilia is the capital of Brazil.
  • The official language of Brazil is Portuguese.
  • As of 2022, the GDP of Brazil was reported to be 1.89 trillion USD.
Brazil map

Table of Contents

  • Agreements
  • Onboarding Process
  • Visa
  • Minimum Wage
  • Payroll Cycle
  • Annual Bonus
  • Health Benefits
  • Working Hours and Overtime
  • Leaves
  • Social Security
  • Taxes for Employers
  • Taxes for Employees
  • Probation
  • Termination
  • Severance Pay
  • Employees or Contractors
  • Final Words


  • 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.
Onboarding Process

Onboarding Process

Brazil does not have any specific laws for onboarding employees. However, the following points must be noted for seamless onboarding -
  • Employers can request employment history, education certificates, address, Social security details, and such information from employees. However, legal advice must be sought before requesting other information.
  • Brazil has strict laws against discrimination (based on gender, age, disability, civil status, race, and sexual orientation). Hence, employers must be careful while requesting information. If an employee feels that they are facing discrimination, they may press charges on grounds of moral damage.


For work purposes, either a work visa or a business visa can be used in Brazil.
Visto Permanente (Permanent Work Visa) -
  • For people entitled to permanent residence
  • Highly skilled workers (researchers, scientists, etc.)
  • People having the VITEM V visa can apply for Permanent Visa after two years.
  • Investors investing $50,000 per person or $200,000 per company or more can attain this visa.
VITEM V Work Visa requirements -
  • Approval from the Ministry of Labor, Brazil
  • Employment contract
  • Employer details (registration documents, etc.)
  • Certificate of conduct from the police department of employee's home country
VITEM II Business Visa requirements -
  • Invitation letter from Brazilian employer
  • Letter from employer stating reason for visit
Visas for dependents or working spouses vary based on employee's home country. Other norms must be checked with local Brazilian embassies.
To get a work permit in Brazil, a business must have a local registered subsidiary and both parties must be involved in the process. However, the EOR company can help with this without setting up local subsidiaries.

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Minimum Wage

Minimum Wage

The minimum monthly wage as per federal law in Brazil (with effect from 1st January 2023) is BRL 1,302. However, some states may have separate limits which should be higher than the federal minimum.
Payroll Cycle

Payroll Cycle

Depending on the employer or the contract, the payroll cycle is either monthly or twice a month. Employers have to pay salaries from a local bank account; which is why EOR is helpful for foreign businesses.
Annual Bonus

Annual Bonus

All employees that have worked for 12 months, receive an additional month's salary at the year-end. This mandatory annual bonus is called the 13th-month salary.
Health Benefits

Health Benefits

  • 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

Working Hours and Overtime

  • 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.


Brazilian employees are entitled to different types of leaves based on their contracts and industries.

Sick Leave

  • Employees receive paid sick leave for up to 15 days. From the 16th day, Social Security pays for the leave.

Parental leaves

  • Female employees are given a 120-day maternity leave which can be extended on medical grounds only.
  • Male employees are granted 5-day paternity leave.
  • Adoption - In the case of adoption, the same rights are applicable.
  • Single adoptive fathers are also entitled to maternity leave.
  • For same-sex couples, one spouse only can avail maternity leave.
  • If the employer is registered under Empresa Cidade, female employees can get leave for up to 180 days, while male employees can get a 20-day paternity leave.

Annual leaves

  • A 30-day (calendar days) paid vacation is granted to employees who have worked for 12 months.

Other Leaves

  • A 3-day marriage leave is granted for employees getting married.
  • Bereavement leave of 2 days is granted in case of death in the family.

National holidays

Employees receive a 100% paid holiday on the following days (for the calendar year 2023) -
  • New Year's Day/ Universal Brotherhood Day(1st Jan)
  • Shrove Tuesday (21st Feb)
  • Good Friday (7th Apr)
  • Easter Sunday (9th Apr)
  • Tiradentes Day (21st Apr)
  • Labour Day (1st May)
  • Corpus Christi (8th Jun)
  • Independence Day of Brazil (7th Sep)
  • Our Lady of Aparecida's Day (12th Oct)
  • All Souls Day (2nd Nov)
  • Republic Day (15th Nov)
  • Christmas (25th Dec)

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Social Security

Social Security

The working population of Brazil contributes a part of their wages which are withheld by the employer and paid to authorities.
Taxes for Employers

Taxes for Employers

The cumulative tax is approximated at 47.9% of the employee's salary.
  • 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%

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Taxes for Employees

Taxes for Employees

Employees in Brazil are taxed 0 - 27.5% based on their income. The following is a breakdown of income taxes for employees in BRL.
  • Up to 1903.98 BRL - 0% tax rate
  • 1903.98 - 2826.65 BRL - 7.5%
  • 2826.65 - 3751.05 BRL - 15%
  • 3751.05 - 4664.68 BRL - 22.5%
  • 4664.68 BRL and above - 27.5%
Employees also have social security (INSS) taxes from 7.50% - 14% based on their income.


The probation period is from 45 days to a maximum of 90 days. However, probation is not mandatory.

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Termination of the contract or employment in Brazil can be performed by issuing proper notice to the parties involved.
  • 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

Severance Pay

Employees who have worked for at least 1 year receive severance pay. Employers are required to set aside a Time of Service Guaranteed Fund (FGTS), which is about 8%. Employees receive this as severance.
Employees terminated without cause receive an additional 40% of the balance of FGTS.
Employees or Contractors

Employees or Contractors

  • 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.
Final Words

Final Words

Brazil's investor-friendly laws, proximity to other international business centers, and work policies make it a great destination. EOR services are a great way to set up and manage remote teams without dealing with complex laws or setting up a local entity.

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