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Check out the new Provisional Labor Measures and their consequences

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With the COVID-19 pandemic, the Federal Government published Provisional Measures 1045/21 and 1046/21 that reissue the labor measures taken in 2020. The actions announced on April 28, 2021 provide:

  1. Reduction of work hours and wages
  • It is possible to proportionally reduce hours and wages by 25%, 50% and 70%, with a provisional work guarantee during the reduction and, for the same period, after the re-establishment of full hours and wages.
  • The reduction of wages and hours can be carried out with individual agreements, without the involvement of a union, in the following situations:

    a) 25% reduction of hours and wages;
    b) When the reduction does not result in a decrease in the total received monthly by the employee (salary + emergency benefits + compensatory aid); and
    c) For employees: (a) with a salary equal or less than R$ 3.300,00; or (b) holders of higher education degrees who receive a salary above R$ 12.867,14.
  • A collective bargain with a professional union is necessary for reductions in different percentages of 25%, 50% and 70% and for reductions in situations which don’t fall in the cases above.

2. Work contract suspension

  • Prevision for employment contract suspension , with provisional guarantee of employment for the duration of the suspension and, for the same period, after the reinstatement of full working hours and salary.
  • The contract suspension can be realized with individual accords, without union intervention, in the following cases:

    a) For workers: (i) with a salary equal or less than R$ 3.300,00; or (ii) holders of higher education diplomas who receive a salary above R$ 12.867,14.
    b) When the reduction does not result in a decrease in the total received monthly by the employee (salary + emergency benefits + compensatory aid).
  • Payment of a compensatory aid of 35% is mandatory for companies with a gross revenue greater than R $ 4,800,000.00 in the calendar year 2019.
  • A collective bargaining agreement is necessary with professional unions for other cases of contract suspension.

3. Emergency Aid

  • Is to be paid by the federal government during the hours and salary reduction or in cases of work contract suspension;
  • The amount of Emergency Aid will be based on the calculation of Unemployment Insurance, which can reach up to R $ 1,336.54 for working hours reductions. For suspensions of the employment contract, the Benefit will be up to R $ 1,909.34 or up to R $ 1,336.54 in companies with gross revenue greater than R $ 4,800,000.00 for the 2019 calendar year.
  • To be granted the Emergency Aid, the employer must notify the professional union and the federal government on the measures within 10 days of their agreement;
  • It is possible to cancel the prior notice in progress and adopt the reduction and suspension measures.

4. Telecommuting

  • It is possible to adopt remote work with communication to the employee 48 hours in advance;
  • A written contract must be signed in 30 days.

5. Approval of holidays, individual time off and collective time off

  • Possibility of moving up individual holidays and granting collective holidays, which must be communicated at least 48 hours in advance.
  • Advanced notification to the Ministry of Economy and professional unions are waived.
  • Time off granted due to the state of emergency may be paid up to the 5th business day of the month following its beginning. A third of holidays may be paid by the date on which the 13th salary is due.
  • The conversion of a third of the holidays into a bonus will depend on the agreement with the employer.
  • Possibility of discounting early vacations for severance pay, in case of resignation.
  • Possibility of moving up federal, state, district and municipal holidays, including religious holidays, by notifying employees, at least 48 hours in advance.

6. Comp Time

  • It is possible to create, by individual or collective agreement, a special Comp Time system, aiming to compensate negative hours, resulting from the interruption of the employer’s activities;
  • In the case of companies that perform essential activities, the special Comp Time regime may be implemented regardless of the interruption of their activities.
  • Compensation of hours can be done in up to 18 months, starting from the 26th of August 2021.

7. Deferment of FGTS payment

  • FGTS payments related to the April, May, June and July 2021 capacities may be carried out, without incurring a fine, updates and charges, in up to 04 monthly installments, starting from September 2021.
  • In case of termination of the employee, the installments will be due in advance.

8. Other measures

  • Suspension of the obligation to carry out occupational medical examinations, except for dismissal, for workers who are telecommuting. This rule does not apply to healthcare workers and assistance sectors in a hospital environment.
  • Occupational medical examinations of on-site workers may be carried out up to 18 days after their expiration.
  • Suspension, for 60 days, of the obligation to carry out periodic and occasional training of current employees;
  • Health facilities, through an individual agreement, may extend the working hours of their employees and adopt overtime schedules between the 13th and 24th hours of the rest period.
  • Possibility of using electronic means for the purpose of calling, deliberating, deciding, formalizing and publishing collective rules.
  • Reduction in half of the deadlines related to the negotiation of collective norms.

Our labor team remains attentive to legislative news to best inform our clients.

Follow our webinar on the subject and learn more:

Daniel Rangel
Head Of Labor Law