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Occupational health and safety and labour issues
Health and safety What health and safety regulations and procedures apply to oil and gas operations (upstream, midstream and downstream)?
There are several provisions dealing with occupational health and safety in the Federal Constitution, the Labour Code, the Ministry of Labour rules and many other pieces of legislation. In addition to these general provisions, the National Agency of Petroleum, Natural Gas and Biofuels (ANP) has also issued regulations that are specific to the oil and gas sector.
For example, with regard to upstream activities, ANP Resolution 43/2007 introduced the Management System for Operational Safety for drilling and production offshore installations. As regards midstream activities – more specifically, oil refineries – ANP Resolution 05/2009 approved the Technical Regulation for Health and Safety for Oil Refineries.
Labour law Are there any labour law provisions with specific relevance to the oil and gas industry (eg, with regard to use of native and foreign personnel)?
Yes. Law 5,811/1972 (the Oil Workers Law), which was enacted on October 11 1972, applies to individuals who work in the exploration, drilling, production, refining and transportation of oil and natural gas.
The Oil Workers Law aims to accommodate certain working conditions specific to the oil and gas sector, such as:
- 12-hour work shifts;
- 14 consecutive days of work followed by a 14-day rest period; and
- the payment of additional allowances.
With regard to foreign employees, the Labour Code provides, as a general rule, that a company can employ foreign employees if:
- Brazilian employees constitute at least two-thirds of the company’s total workforce; and
- the compensation paid to Brazilian employees is equivalent to at least two-thirds of its payroll.
Brazilian immigration authorities usually grant temporary visas based on an employment relationship between a foreign worker and his or her company. These temporary visas can be valid for up to two years and may be renewed for up to a further two years.
Notwithstanding that, a temporary visa can, in certain circumstances, be granted to a foreign employee who is not bound by a labour contract with a Brazilian company – for example, expatriates who come to Brazil to work via technology transfers to provide technical assistance or in emergencies.
With regard to maritime workers, National Council for Immigration Normative Resolution 72/2006 (RN 72/2006) regulates the granting of a temporary visa to foreign crew members who work on board foreign vessels or platforms that are operating in Brazilian territorial waters and have no employment relationship with a Brazilian company. RN 72/2006 allows for the requirement of a minimum two-thirds proportion of Brazilian employees to be relaxed for a certain period, depending on whether the company operates:
- supply vessels;
- vessels and platforms that are directly or indirectly applied in the exploration and production of mineral resources; or
- vessels used in coastal navigation.
An example of this exemption is as follows:
- The crew of a foreign drilling unit may comprise 100% foreign workers in the first 180 days of operation in Brazil.
- Between the 181st day and the 360th day, such crew must comprise at least one-fifth Brazilian employees.
- Between the 360th day and the 720th day, the crew must comprise one-third Brazilian employees.
- As of the 721st day, the Brazilian company must comply with the regular rule of having a workforce comprising two-thirds Brazilian employees.
Finally, permanent visas are usually granted to foreign employees who will be directors, officers or managers of Brazilian companies. In order to grant such a visa, the government requires a minimum investment in Brazil of R600,000 per permanent visa application. Such investment may be reduced to R150,000 if the company commits to establishing at least 10 direct jobs within two years.
What is the state of collective bargaining/organised labour in your jurisdiction’s oil and gas industry?
Collective bargaining agreements are an important tool for regulating several aspects of the oil and gas sector that are not clearly foreseen in law. As Brazilian labour courts are known to be protective towards employees, such collective bargaining agreements may help to mitigate the risks of labour claims by regulating situations that are unique to the oil and gas sector.
Brazil’s various labour unions do not have equal political and economic strength. As such, some labour unions are more flexible in negotiations, while others are rigid. Two of the main unions representing oil workers are Sindipetro – the oil workers union – and Sinditob – the offshore employees union.
Although some conditions (eg, work shifts and additional overtime pay) can be negotiated through collective bargaining agreements, other labour rights (eg, Christmas bonuses, the Employee Indemnity Guarantee Fund or additional pay for unhealthy or hazardous working conditions) cannot be negotiated or waived by parties. However, there is an ongoing political effort aimed at a labour reform, the main focus of which will be whether the labour rules can be more flexible and respect the negotiations between employers and employees, particularly in cases where the unions are also involved.
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