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LAW PROMOTING LABOR REFORM IS SANCTIONED INTO LAW
31/08/2017
The Brazilian Presidency sanctioned, on July 13, 2017, the Law no. 13,467, which amends the Consolidation of Labor Laws (CLT), approved by Decree-Law no. 5,432 of 1943, and the Law nos. 6,019, of 1974, 8,036, of 1990, and 8,212, of 1991, with a view to adequate the legislation to new work relations. The bill proposed by the Executive Branch was significantly altered by the Brazilian House of Representatives, having been approved by the House of Representatives and the Senate a Clean bill to the original bill. The approved bill received no veto from the Brazilian Presidency. 

The reform brought substantial alterations in the legislation currently in force, being worth highlighting the following:  

a) The characterization of economic group for the purpose of application of the CLT, lays down that the mere identify of company members is not enough, but rather the demonstration of integrated interest, an effective convergence of interests, and joint action of the companies.  This legal definition reverts the common position adopted by the Labor Courts. 

b) The time the worker remains at the company, by his/her own choice, for private reasons, will not be considered as time at the employer’s disposal nor can be computed as overtime period, should this time exceeds the regular working hours;  

c) Restrictions to the normative power of precedents  and other caselaw precedents published by the Superior Labor Court,  and by the Regional Appellate Labor Courts, being established that such decisions cannot  restrict rights legally provided for, nor create obligations not set forth in law. It is worth highlighting that this provision is being fairly questioned, including by Labor Court representatives. 

d) Strengthening of the terms agreed upon in Collective Labor Agreements or Collective Bargaining Agreements, being the Labor Court exclusively incumbent upon analyzing the conformity of the essential elements of the legal business, basing its  acting  on the principle of minimum intervention in the autonomy of collective will;  

e) Creation of liability rules of the dissenting member, and defined the priority order for the dissenting member to be accountable for the labor law obligations. The CLT had no provisions addressing this issue, being such aspect met by the caselaw. 

f) Instituted the intervening limitation of action for labor proceedings of two (2) years.  The intervening limitation of action refers to the loss of right as a result of the inertia of the holder of an execution who does not take actions for continuity of the case. 

g) Increase of the administrative fine prescribed in article 47 of the CLT for the failure to register the employee. The last update of the value of the fine occurred with the extinction of the UFIR (a statutory inflation-adjustment index), in October, 2000, being nowadays R$402,00 per unregistered employee. With the labor reform the value of the fine becomes R$3,000.00; 

h)The time spent by employee from his residence until the effective occupation of the work post and his return, walking or by any means of transport, including the transportation offered by the employer, will not be computed in the working hours, for not being a time at the employer’s disposal.  This provision reverts the position adopted by several judges, who, upon making the best possible use of Precedent no. 90 of the Superior Labor Court (TST), decide that the commuting hours must be computed  in the working hours, even when the employer offers transportation in locations to which  there is regular public transport. 

i) The period of duration of the work in partial regime may be at most of 30 hours, without the possibility of overtime or excess hour, in lieu of the 25 hours, as laid down in the legislation in force. It has also henceforth been prescribed the possibility of the partial work to be contracted for up to 26 weekly hours, with possibility of increase of up to 6 (six) supplementary weekly hours. Such supplementary hours, if worked, must be paid with an additional of 50% over the regular  hourly wage.  

j) Possibility of overtime or excess hours of the regular working hours to be directly compensated until the week immediately after its execution, and its respective release must be made in the payroll of the subsequent month, in case  these supplementary hours are not compensated. 

k) Possibility of an individual agreement for compensatory time, which must be agreed  in writing,  with compensation in maximum period of six (6) months; 

l) Regulation of remote work; 

m)  Regulation of moral damage compensation, through typification of the elements necessary to define its occurrence and valuation; 

n)  Regulation relative to  employee’s absence from work during her pregnancy and breastfeeding period, in accordance with insalubrious conditions; 

o)  Regulation of intermittent employment; 

p) Enhancement of the rule relative to the employee´s salary structure. Occasional installments such as awards and travel expenses, seeking to encourage its use,  do not make part of  the worker’s fixed compensation, avoiding that taxes are levied upon these occasional installments,  or that are permanently incorporated into the employment agreement; 

q)  Possibility of use of arbitration in the event of individual employment agreements, whose compensation is higher than twice the maximum limit laid down for the benefits of the Social Security General Regime, as long as it be by the employee’s own initiative or the employee’s express agreement. 

r) Election of a workers’ representative  in companies with more than two hundred (200) employees, whose purpose will be to interact with the employer in the name of other employees, promoting a direct understanding with the company management. The workers representative at the workplace must act in the conciliation of labor conflicts within the ambit of the company, including those relative to the payment of periodic pay and severance payments, as well as participate in the negotiation table of the collective bargaining agreement with the company. The representative´s authority will have a duration of two years, being allowed one reelection, and barred the arbitrary dismissal or dismissal without cause, since the registry of its candidacy until six (6) months   after the end of the authority.

s) The union dues will no longer be compulsory, and can only be made should it be previously authorized;  

t) Possibility of the Collective Labor Agreement or Collective-Bargaining Agreement to set forth provisions on several labor topics by operation of the law., standing out among them,    

possibility of the annual vacation to be split into three periods, with payment proportional to the installments, so that one of the fractions necessarily corresponds to at  least two uninterrupted weeks of work; 

covenant as to the fulfillment of the working hours, limited to 220 monthly hours; 

company profit sharing so as to include its installment within the limit of the balance sheet periods and/or of the  trial balances legally required, not inferior to two installments; 

commuting hours; 

work break, abiding by the minimum limit of 30 minutes

career and salary plan;

hour bank system,  ensured the conversion of time exceeding the regular working hours, increased by a minimum of 50%; 

telework, on call,  and intermittent work; 

compensation per productivity, included tips received by employee. 

working hours record

u) Change in the distribution of labor procedures’ costs, making that the responsibility for the payment of expert fees be of the losing party in the claim object of the expert evidence, even beneficiary of free legal aid.

v) Change in labour procedure’s rules, notably forecast of loss of suit expenses fees by the losing party. 

w) Update of Law no. 6,019/ 1974 in the hiring of outsourced personnel who will be able to act in any activity in the contracting company, including the main activity. 


The new law will enter into force within one hundred and twenty days from its official publication, occurred on July 14, 2017. 

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