Now that the impeachment process of former President Dilma Rousseff has finally been concluded (with former Vice President Michel Temer serving the remainder of Rousseff's term), a different political and economic landscape is anticipated for companies.
In his first speech as the new president, Temer vowed to introduce structural and legal reforms to improve the country's economic situation. These reforms may include changes to labour and employment laws.
While this potential labour reform is being drafted by the new government, the Supreme Court has rendered several decisions on labour and employment matters that may be understood as the beginning of the labour reform. Two important decisions issued in September 2016 are discussed below.
Right to commuting expenses
In the first case, the Supreme Court considered whether a special collective bargaining agreement executed between a sugar and ethanol factory and the relevant labour union could withdraw an employee's right to be compensated for his or her commute to and from the office. In Brazil, companies may be required by law to pay commuting expenses where no public transport is available between an employee's residence and worksite.
In this case, the Supreme Court overturned the Superior Labour Court's earlier decision, holding that collective negotiation prevails over the law and thus that some rights can be suppressed if previously negotiated with the labour union, provided that the collective bargaining agreement establishes other rights to compensate any loss therein.
This is not the first time that the Supreme Court has overruled a Superior Labour Court decision on the grounds that a collective bargaining agreement prevails over the law. For example, the Supreme Court recently held that a former employee who had agreed to a voluntary dismissal plan established by a collective bargaining agreement could not sue the company for additional labour rights, as the plan contained a waiver and full release clause.
Labour judges have historically ruled that employees cannot waive the fundamental rights set out in the Constitution. However, the Supreme Court's new rulings may significantly affect labour court decisions in comparable cases.
In the second case, the Supreme Court discussed whether the limit on working hours applied to firefighters. In its decision, the court maintained that firefighters are subject to the "12 x 36" working regime (ie, 12 hours of work, followed by 36 hours of rest). Brazilian law sets out that employees cannot be subject to more than eight hours of work per day and 44 hours of work per week. This regime was originally ruled unconstitutional by the Superior Labour Court on the grounds that it caused employees stress and could lead to work-related accidents. The Supreme Court's decision will likely serve as legal precedent in similar cases from other economic sectors (eg, healthcare and metallurgy).
It is hoped that greater labour reform will take place in Brazil, to ensure that the country remains competitive in the global market. These first steps by the Supreme Court are a positive sign of what is to come in the near future.
For further information of this topic please contact Vilma Toshie Kutomi, Cleber Venditti da Silva or José Daniel Gatti Vergna at Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados by telephone (+55 11 3147 7600) or email ([email protected], [email protected] or [email protected]). The Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados website can be accessed at www.mattosfilho.com.br.