Be Global is DLA Piper's snapshot of key global employment law developments designed to help you identify legal hotspots across your global operations and assess the impact on your employment practices and procedures.
Global Employment Guides
Our International Employment Group is pleased to announce the launch of four new Global Employment Guides -
- Employment Laws of the World
- Business Transfers
- Restrictive Covenants
- Redundancies and Reductions in Force
Covering multiple jurisdictions across Europe, the Americas, Asia-Pacific and Africa, our Guides highlight the key legal provisions and provide practical guidance to assist you to understand, plan and implement your global strategy and highlight areas of potential risk where you may wish to contact us for more tailored legal advice. To obtain electronic copies of one or more of the Guides, please contact our Marketing Team firstname.lastname@example.org.
US: Top 10 Employment Pitfalls As You Go Global
As international businesses develop their global employment documentation, Ute Krudewagen, a Partner in our Palo Alto office, highlights ten important pitfalls for them to be aware of. Click here to read more.
Saudi Arabia: Webinar on the recent introduction of the Nitiqat and Ajeer Systems in Saudi Arabia
Our Middle East Employment team delivered a webinar recently covering issues surrounding the nationalization agenda in the Kingdom of Saudi Arabia. The attached recording of Neil Crossley (Practice Head Employment, Middle East), Ammar Al Zughaiby (Legal Consultant, Riyadh) and Patricia Wardrop (Senior Legal Consultant, Dubai) lasts one hour and covers: a basic outline of Saudi employment law, contracting options for employees and basic rights together with a more detailed discussion about the introduction of regulated manpower companies designed to provide a higher quality pool of expatriate labour for businesses (the Ajeer system). To view the webinar please click here.
Singapore: New data protection regime fully in force
July 2014 saw the full implementation in Singapore of a new data protection regime which has as its main purpose the protection of individuals' data. Click here to read more.
Brazil: Discrimination on grounds of HIV/AIDS status is a criminal offence
From June 2014, it is unlawful for employers to discriminate against individuals who have HIV/AIDS; such action has now become a criminal offence, punishable by a fine and 1 to 4 years' imprisonment. Click here to read more.
Australia: New gender equality reporting obligations
From April 2015, organisations with 100 or more employees (with the exception of public sector employers) will have new annual gender reporting obligations to the Workplace Gender Equality Agency (Agency) under the Workplace Gender Equality Act 2012 (WGEA). The introduction of the WGEA brought about significant changes to the Agency and introduced more onerous requirements than previously existed under the Equal Opportunity for Women in the Workplace Act 1999. Employers covered by the WGEA are currently required to complete and submit an annual report to the Agency containing a workplace profile and a reporting questionnaire that provides information on six gender equality indicators (GEIs). Additional reporting requirements in relation to three of the GEIs were intended to be implemented on 1 April 2014. However, the Government announced in March 2014 its decision to delay the introduction of those additional reporting requirements by one year to allow for further consultation after stakeholders raised concerns. Importantly, this delay does not affect the existing reporting requirements.
When the additional reporting requirements take effect on 1 April 2015, relevant organisations will also need to report on various additional matters including job applicants, promotions, resignations, and policies or measures to support employees experiencing family or domestic violence. From 1 October 2014, organisations with 500 or more employees will have an additional obligation under the WGEA, which is to meet new minimum standards for gender equality. The Government has introduced these minimum standards to encourage progress by large organisations towards achieving gender equality in their workplace. Click here to read more.
Australia: Enterprise Agreements
There have been a number of developments relating to Enterprise Agreements:
- The Fair Work Commission (FWC) has refused to approve a proposed enterprise agreement because an employer prematurely started the voting process by posting to employees a ballot paper, return envelope and the notification of a postal vote, at a time when the required seven days' access period to the proposed agreement had not elapsed. This decision demonstrates the importance which the FWC places on all pre-approval processes and the precise time frames which must be observed if an agreement is to be approved.
- The Full Bench of the FWC has upheld a decision in which a greenfields agreement was refused approval. Greenfields agreements are able to be made between employers and unions in the case of new enterprises. However, in the case at issue, six employees who were necessary to the new enterprise had already been employed at the time the greenfields agreement was entered into (although they were not yet working on the project). The case highlights the importance of there being no existing employees who are necessary to the new enterprise prior to entering into a greenfields agreement.
- The FWC has given approval for a union delegate of the Maritime Union of Australia (MUA) to act as a bargaining representative on behalf of maintenance employees in relation to a proposed enterprise agreement. The MUA was separately acting as a bargaining representative on behalf of other employees. Although the employer argued that the MUA was ineligible to cover maintenance employees, and was in fact indirectly representing the maintenance employees through its delegate, the FWC rejected the argument. The FWC found that the delegate was neither an employee nor an official of the MUA, and that there was no evidence that he was controlled by, or improperly influenced by, the MUA.
- A very large penalty has been imposed by the Federal Circuit Court in a case of sham contracting. The case had been initiated by a federal government regulator on behalf of 10 staff who had not been paid minimum statutory employment entitlements. The misrepresentation of the employment relationship as a contracting arrangement had resulted in underpayments of over AUD 170,000. The Court had previously ordered compensation to be paid to the staff in respect of the underpayments. At a separate penalty hearing, the Court has imposed, in addition, a penalty of AUD 313,500.
- The FWC has refused to uphold an employee complaint of bullying, even though the FWC accepted that the communication of a manager's instruction had been forceful. The FWC accepted that managers may express upset and anger from time to time, without this constituting bullying. This decision suggests that the FWC is prepared to interpret the exclusion from bullying of reasonable management action carried out in a reasonable manner with some latitude.
- The new Australian financial year commenced on 1 July 2014 and from this date:
- the compulsory employer superannuation contribution on earnings increases from 9.25% to 9.50% per annum; and
- the federal minimum weekly wage for an adult increases to AUD 16.87 per hour (a 3% increase on the previous minimum wage).
China: Unilateral termination of striking employees was illegal: Employers should consider the reason for strike action before dismissing
The Labour Arbitration Tribunal in the Fujian Province of Xiamen has ruled that a company's unilateral termination of employees who participated in a strike was illegal. The court decided that the basis for the strike was reasonable and as such, the strike action did not constitute a serious violation of company policy sufficient to justify unilateral termination.
Whilst the details of the case have not been published, the principle emerging appears to be that, where a company has violated its labour law obligations, and employees have gone on strike as a result, the strike could be considered a reasonable response to the company's actions. Where that is the case, any unilateral termination could be deemed a wrongful termination.
Employers operating in the PRC should not assume that it is legal to dismiss any employee who is striking. Instead, employers should consider the reason/s why the employee is on strike before deciding on the action to take. Where there is a risk of wrongful termination, termination by mutual agreement is the best way to avoid that risk. Whilst this case was decided by the Xiamen Labour Arbitration Tribunal, the principle could well apply to other regions in the PRC.
China/Shanghai: Employers required to file plans to comply with labour dispatch rules / social security disputes
As we reported in June's Be Global, Beijing and Hubei Province have introduced rules requiring employers to file plans to demonstrate compliance with the 10% cap on dispatch workers that a company may engage as a percentage of the overall workforce. Shanghai has now followed suit. Employers in Shanghai must file their plans by 31 October 2014.
Shanghai has also announced a change to the process for dealing with disputes relating to social security contributions. As of July 2014, such claims will be dealt with by the Labour Supervision Department rather than the Labour Arbitration Commission. This may delay the claims process, although as this will now be the only recourse for such claims, the process times may eventually improve. Foreign employers acquiring businesses in the PRC should check as part of the due diligence process that all social security contributions have been paid properly otherwise back pay and fines could be due.
China: Lessons for employers on the risks of unwritten contracts and minimizing overtime liability
The Superior Court in Jiangsu Province has issued information and guidance on typical employment cases that came before the court during 2013, which provides a useful insight into some of the issues commonly litigated in the PRC labour courts. Whilst the cases have no precedent value in other regions, the principles are largely the same elsewhere. The following case studies provide important lessons for global employers operating in China:
The risk of unwritten and unsigned contracts
Under PRC Labour Contract Law, an employee who does not have a valid (signed) written contract of employment is entitled to double salary from the second month after starting work to the earlier of the date when the contract is signed or the end of the twelfth month after starting work. If the contract remains unsigned at twelve months, an open-ended contract will deemed to be in force. It is quite common for employees to be awarded double salary, even where this is just the result of an administrative oversight. As such there could be an incentive for an employee to avoid entering into a signed contract of employment. This case study shows that an employee cannot benefit from their own breach of duty relating to the execution of a contract.
The claimant joined the company as HR manager on May 14, 2012. The legal representative of the company sent a template of the employment contract to the claimant asking her to manage the execution of all employment contracts with staff. In November 2012, the labour authorities checked whether the company had signed written employment contracts with all employees, and found that all contracts had been signed except for the claimant's. Thereafter, the company ask the claimant to sign her contract, but she delayed the process with various excuses. At the end of November, the claimant resigned and brought a claim for double salary. The court refused her claim because she was the HR manager and therefore liable for employment contract execution. The fact that she did not have a written employment contract was a sign of her failure to perform her duty. This serves as a reminder to employers operating in China of the importance of ensuring that written contracts are entered into and fully executed with all staff, including those who are themselves responsible for discharging this as part of their employment duties. Employers entering into China should consider including the duty to execute contracts into job descriptions of relevant individuals.
Invalid working hour system led to overtime liability
Many employers operating in China apply for approval to implement special working systems as this can significantly reduce overtime liability. This case study shows that employers can be liable for overtime payments based on standard working hours if the position in question does not in reality comply with the requirements of the special working system.
A factory worker was successful in a claim for overtime pay based on standard working hours despite the fact that his position had been approved to be covered by the Comprehensive Working Hour system (CWH). CWH can reduce overtime liability as it enables working hours to be calculated on a periodic basis (eg monthly, quarterly annually) and the rate of weekend overtime (150%) is lower than the rate for the standard working hour system (200%). For the CWH system to apply, the employer must obtain approval from the local Human Resource and Social Security Bureau, which must be renewed annually.
In this case, the court decided that although approval had been granted, in reality, the worker's role did not meet the requirements of the CWH system or reflect the description of the job given in the approval application. Therefore, the worker was entitled to overtime pay based on standard working hours and the employer was required to pay the shortfall.
Employers should take note that the mere fact that approval for CWH has been granted for a certain position, does not prevent an employee from bringing a claim for additional overtime pay if the reality does not reflect the position described in the approval application. Special working hour systems should only be used where they are suitable for the positions in question, and should not be used to evade overtime payments. When approval is granted for a position, the company should ensure that the job as described in the application is properly implemented. The same principle will apply to the Flexible Working Hour System.
On 2 July 2014, the Personal Data Protection Act (PDPA) took full effect in Singapore. The entry into force of the main data protection provisions of the PDPA marks the end of the staged introduction of this legislation which saw some provisions adopted in December 2012, the formation of the Personal Data Protection Commission (PDPC) in January 2013 and provisions relating to the Do Not Call Registry coming into force earlier this year. The PDPC has also recently issued the Personal Data Protection Regulations and non-binding guidelines to aid compliance with the new legislation.
The legislation applies to 'organisations' which is widely defined and essentially applies to anyone carrying on a business in Singapore, whether or not incorporated under Singaporean law or resident within the country. This is subject to some very limited exceptions.
The main purpose of the law is to provide a standard of protection for individuals' data, requiring consent to be obtained for the collection, use, disclosure and transfer of personal data. Organisations will also be required to allow individuals to access and correct errors in their personal data, as well as to provide individuals with information about the ways in which their personal data may have been used or disclosed. Primarily, organisations must:
- Appoint at least one person as a Data Protection Officer and ensure their details are made publicly available;
- Secure individuals' consent to the collection and retention of their personal data (except where required by law);
- Ensure the accuracy of the data, with appropriate consideration given to the nature of the data and the significance it has for the individual;
- Provide access for individuals to establish what data an organisation holds on them as well as providing mechanisms to correct any inaccuracies both within the organisation and within any third party to which it has disclosed the inaccurate data;
- Put in place appropriate security measures to prevent any unauthorised access to personal data, again with reference to the nature, sensitivity and significance of the data held. Security should be reviewed at intervals to determine whether security measures continue to be appropriate; and
- Ensure that any recipient outside of Singapore to whom data is transferred is legally obliged to provide data protection comparable to that in the PDPA.
Non-compliance with these provisions may result in severe financial penalties for the organisation of up to SGD 1 million imposed by the PDPC.
EU Wide: Advocate General considers that obesity can be a disability
The ECJ was recently asked in the case of Kaltoft v Kommunernes Landsforening to consider whether obesity should be regarded as being a disability for the purposes of disability discrimination. On 17 July 2014 the Advocate General gave his opinion in the case. He said that whilst there is no general principle prohibiting employers from discriminating on grounds of obesity in the labour market, severe obesity can be a disability covered by the protection against disability discrimination if it, in interaction with various barriers, hinders full and effective participation of the person concerned in professional life on an equal basis with other workers. By severe obesity the Advocate General was referring to morbid obesity, meaning a BMI of 40 or more (around 21 stone or 294 pounds for an average height man). If an individual is classified as morbidly obese, they may be disabled if the obesity has a real impact on their ability to participate in work.
If the ECJ takes the same view as the Advocate General, this case could have implications for both employers and service providers particularly in relation to the duty to make reasonable adjustments.
France: Update on SYNTEC 218-working day arrangements
In April's Be Global we reported on the misleading media coverage which had suggested that employees in France were to be prohibited from answering emails after 6 pm. In fact, the reports related to an amendment to the national SYNTEC Collective Bargaining Agreement, details of which can be found in our previous alert.
As explained before, the amendment does not prevent employees from checking their email after 6 pm but simply provides that they must disconnect from remote working devices during rest periods and employers must ensure the necessary means are in place to ensure this happens. The amendment also imposes a number of other requirements, aimed at providing greater employee protection, which must be met in order for employers to be able to use the 218-day working arrangements available under the SYNTEC CBA.
The ministerial decision extending the relevant amendment was published in the Official Journal on 4 July 2014 which means that:
- Employers with an internal collective bargaining agreement on the 218-working day arrangement will have 6 months, until 4 January 2015, to comply with the amended SYNTEC provisions; and
- For employers who fall within the scope of the SYNTEC CBA but do not have an internal collective bargaining agreement, the amendment provisions will apply from 1 August 2014.
The ministerial extension decision also specifies that:
- All the requirements introduced by the amendment are compulsory for employers/employees working within the scope of the SYNTEC CBA;
- Employers must specify in an individual agreement with any employee working under a 218-working day arrangement (i) the number of working days and (ii) the calculation method for days or half-days of work and rest days. So, simply cross-referring in the employment contract to the provisions of the SYNTEC CBA is not sufficient and the exact number of working days must be set out in the contract; and
- The amendment does not prohibit a company-wide CBA being used to set the main terms of individual 218-working day arrangements, provided that the terms are sufficient to guarantee adequate protection of employees' health and safety.
France: Unemployment insurance: new rules applicable
On 14 May 2014, the French trade unions signed a new agreement on unemployment insurance (UIA) which incorporates the main provisions of the national inter-professional agreement concluded in March 2014.
Some of the main UIA provisions were originally due to take effect from 1 July 2014 but the trade unions have now pushed this back to 1 October 2014. The main changes which the UIA makes can be summarized as follows:
- The implementation of "rechargeable" rights - historically, when a job seeker moved from one employment to another and then was dismissed from that second employment, when calculating unemployment allowances, the French Employment Agency compared the accrued benefits under the original employment contract to those to which the individual would be entitled under the second employment contract (subject to the employment being for at least 4 months within the 28-month period prior to termination, as a general principle). Only the rights from the period of employment which was most favourable to the employee were then taken into consideration when calculating unemployment allowances.
From 1 October 2014, job seekers will now be indemnified by the Employment Agency by way of "rechargeable" rights, which will apply whether or not the job seeker has found new employment. In other words, under this new scheme, the Employment Agency will assess what unemployment allowance a job seeker is entitled to on the basis of remuneration during all previous employment, so there will no longer be a comparison between original and subsequent employment. These unemployment rights will apply until they are used up. If the job seeker then finds a further job but subsequently becomes unemployed again, unemployment rights acquired as a result of the first period of employment will be used first and once they are used up, the unemployment accrued in relation to the second period of employment will apply. Thus, the job seeker does not lose any unemployment rights under the new rules and any rights acquired run consecutively. These rechargeable rights will be implemented automatically so there is no requirement for an individual job seeker to remain on the list of job seekers to have their unemployment rights classed as "rechargeable".
- Improved indemnification where employees work for multiple employers simultaneously - to date, where an employee works for several companies, this has not been taken into account when calculating total accrued unemployment rights for the purposes of any future period of unemployment. However, from 1 October 2014, the loss of any one job may entitle the employee to unemployment rights so it is possible to receive unemployment allowances in relation to the loss of one role even where an individual continues to work for another employer. In the event of any subsequent loss of employment, the individual would receive additional unemployment allowances corresponding to the loss of such further employment.
- Decrease in the level of indemnification for all monthly gross remuneration over EUR 2,054 - from 1 July 2014, for all job seekers whose previous gross monthly remuneration exceeded EUR 2,054, unemployment allowances are now calculated at 57% (instead of the current rate of 57.4%) of their gross daily reference salary.
- Waiting period for indemnification is increased to 180 calendar days - previously, if extra-statutory termination compensation was received on leaving employment, the employee was subject to a waiting period before being indemnified by the Employment Agency. This waiting period was calculated based on the amounts paid (ie extra-statutory termination compensation/daily reference salary) but did not exceed 75 calendar days. As a general principle, since 1 July 2014, the maximum duration of this waiting period has been increased to 180 days. The method for calculating the waiting period has also been changed so it is calculated based on the compensation or sums paid/90). This new rule does not apply to employees who are dismissed for economic reasons (ie redundancy) where the maximum waiting period will still be 75 calendar days.
Germany: National minimum wage in force 1 January 2015
As reported in previous editions of Be Global, Germany will impose a nationwide minimum wage as of 1 January 2015 for the first time. The minimum wage will amount to EUR 8.50 (GBP 7.11, USD 11,55) and will be reviewed every two years. The implementing legislation also provides that companies may be held liable if a contractor, subcontractor or even an agency mandated by them is in breach of the minimum wage. Therefore, it is recommended to reflect this in agreements with contractors and subcontractors and also choose contractors with diligence to ensure they are compliant. Furthermore, intentional violations of the law may lead to criminal prosecution, depending on the seriousness of the case. As reported on our Germany employment blog, the national minimum wage legislation has now been approved by the lower house of the German Parliament (Bundestag).
Netherlands: Employment law reforms delayed to 2015
The Dutch Government had intended to implement various significant employment law reforms in July 2014. However, as reported in June's Be Global, these reforms have now been delayed to 2015. Click here to read more.
Romania: Constitutional court rules that compulsory pre-claim mediation information meeting is unconstitutional
The Romanian Constitutional Court has made an important ruling which will have a significant impact on employment litigation. Until now, parties to an employment dispute have been obliged to undertake a mediation process (exclusively for information purposes), before the employee can issue a claim in the courts. Any failure by the employee to participate in this mediation information process could - in certain circumstances - render their claim inadmissible. The Constitutional Court has now found that these requirements breach the Romanian Constitution. From 25 June 2014, therefore, employees will no longer be obliged to summon their (former) employers to attend a preliminary mediation information meeting, before issuing an employment claim. While the Romanian Parliament is expected to amend the law within 45 days to reflect this (commencing 25 June 2014), the obligation to hold a mediation information meeting no longer applies. This decision has a significant impact on employers as they may now not be made aware of a claim until it has already been submitted to the court. Employers will therefore need to closely monitor employee relations to ensure they are aware of any potential litigation.Click here to read more.
UAE: Meaning of "last wage" clarified
A recent decision of the Court of Cassation in Abu Dhabi has confirmed that, when calculating the end of service benefits for an employee, the meaning of the term "last wage" as stated in Article 134 of the UAE Labour Law means the employee's last basic salary. In this case the employee had asked to be compensated for their end of service gratuity and accrued but untaken leave on the basis of their last full salary which included various allowances. However, the Court of Cassation categorically confirmed that end of service gratuity should be based on basic salary and when calculating leave entitlements, this is only required to be calculated based on basic salary plus housing allowance where applicable. This is an important clarification for calculating these entitlements. In this case the Court of Cassation also rejected the employee's claim for moral damages in addition to the statutory compensation of up to 3 months' salary which is granted for successful arbitrary dismissal claims. The Court held that, in the event of an arbitrary dismissal, the employee is only entitled to compensation set out in the UAE Labour Law and not any other form of compensation reiterating, therefore, the fact that the maximum compensation due to an employee who has been arbitrarily dismissed is 3 months' pay.
UAE: Emiratisation targets 15% in the insurance sector by 2015
In line with nationalisation requirements across the Gulf, the Minister of Economy in the UAE has confirmed that the Emirati workforce in the insurance sector needs to increase to 15% by 2015. Emiratisation levels in this sector are currently at 8.9% and so this represents a 93% increase in the compliance requirements. When responding to questions on this issue, the Minister stated that "any new insurance company cannot be licensed unless the Emirati workforce is at least 15%." The UAE government generally wants to increase the number of its citizens working in the private sector tenfold by 2021 and has confirmed it will intervene in the labour market if required to achieve that goal. Less than 15% of the UAE's population of nine million people are local nationals and currently more than two thirds of UAE citizens in employment work in the public sector. This preference for public sector work and a lack of awareness about long-term prospects in the private sector will make it difficult for insurance companies to attract UAE national candidates in order to increase their Emiratisation figures. This could lead to companies in this sector having difficulties obtaining a new trade license and new visas for expatriate employees as we have seen in the Kingdom of Saudi Arabia and so insurance companies need to make Emiratisation a firm priority in the next 12 months.
UAE: New E-contracts and E-Labour cards for the UAE
The Ministry of Labour in the UAE has launched a new initiative to have electronic labour cards and electronic contracts issued within 48 hours of the application for a work permit being made. These e-cards and e-contracts will replace the old plastic cards and paper contracts and will assist the Ministry of Interior and Emirates Identity Authority by providing them with an integrated database. Emirates ID cards will be the new and only identification document for employees going forward and these ID cards will only be issued to those holding a valid UAE work permit. The new system should assist with ensuring the efficient issue and renewal of labour cards and employment contracts but employers should bear in mind that the e-contract and e-labour card must be applied for within 60 days of the employee entering the UAE on an entry permit to avoid fines of AED 1,000 for each month of delay. Employers and workers will also be able to check their work permit and contract through the Ministry of Labour's webpage.
UK: Government response to call for evidence on whistleblowing
Last Summer, the UK Government issued a call for evidence on the UK's whistleblowing framework seeking input to identify if any aspects of the law may not be protecting whistleblowers or encouraging them to come forward about wrongdoing. The Government's response to this call for evidence was published in late June 2014 and identifies what employers can expect next on whistleblowing:
- Financial incentives will not be introduced to encourage employees to make disclosures;
- There will be no legislative requirement imposed on employers to implement whistleblowing policies/procedures. However, best practice guidance or a non-statutory code of conduct will be issued;
- Improved guidance for individuals will be made available including information on how to blow the whistle and ways in which to disclose information in order to be protected;
- In terms of the approved bodies to whom workers can make disclosures (eg the tax and health and safety authorities and other regulatory bodies), the current lack of obligation on them to do anything about disclosures they receive will be addressed. This will include a new statutory duty to report annually on, for example, the number of disclosures received and investigated; and
- The categories of individuals protected by the whistleblowing framework will be extended to include, for example, student nurses.
The overall thrust of the Government's response is that it wants to change the negative cultural attitude towards whistleblowing which it has identified exists in a variety of organisation across the UK. Although it is not, at this stage, proposing to go so far as introducing a US-style system of financial incentives, it is continuing its push to encourage whistleblowing as a means of reducing corruption, fraud and other workplace wrongdoing.
US: Choosing between a secondment or localization
For many businesses venturing into or expanding in new territories, it often makes practical sense to send an experienced worker from their home country to the new territory rather than engage an independent contractor or hire a new employee in that destination country. Amie Aldana, an Associate in our Palo Alto office, considers the advantages and drawbacks of the secondment and localization structures which might be used in these circumstances. Click here to read more.
Canada: New categories of leave for Ontario employees
From 29 October 2014, employees in Ontario will be entitled to three new categories of leave:
- Family caregiver leave of up to eight weeks' unpaid leave a year to provide care and support for a family member with a "serious medical condition". No qualifying period of service is required for this leave which supplements existing Family Medical Leave;
- Critically ill child care leave of up to 37 weeks (unpaid) for employees who have at least six months' service; and
- Crime-related death and disappearance leave (unpaid) for employees who have at least six months' service of up to either 52 or 104 weeks depending on the circumstances.
As of 3 June 2014, discrimination by employers against individuals who have HIV / AIDS has become a criminal offence, punishable by a fine and 1-4 years' of prison. Employers must not discriminate when hiring or terminating individuals with HIV/AIDS and must not segregate individuals or disclose their medical condition, aimed at offending the employee’s dignity.
Previously, whilst there was no specific law prohibiting discrimination based on HIV/AIDS status, there is precedent from the Superior Labour Court that when an employee with HIV/AIDS or a serious medical condition is terminated, the termination is presumed to be discriminatory unless the employer is able to provide evidence to the contrary.
As such, most employers are already aware that they must not discriminate against employees with HIV/AIDS, so this new law is unlikely to have a major effect on company practice. However, those employers who require employees to undertake HIV/AIDS tests as a condition of employment should immediately review those practices to determine if there can be any justification for carrying out such tests (and it is difficult to see in what circumstances such tests can be justified), to avoid the potential criminal penalties.
Brazil: Extension of temporary contract periods
In Brazil, temporary workers can only be engaged with the approval of the Ministry of Labour and in limited prescribed circumstances, eg to cover an employee's absence from work such as maternity leave or to cover major peaks in demand, and the period of any temporary contract is strictly regulated. There are other restrictions, including that the temporary worker must be hired through a temporary work company which must be registered at the Ministry of Labour.
Previously, a temporary work contract could only be issued for up to 3 months, extendable for up for another 3 months subject to approval. This significantly limited the benefit of engaging temporary workers and as such the use of temporary workers is not widespread.
A new regulation that came into effect on 1 July 2014 has slightly relaxed the position. Now, temporary contracts may be issued or extended for up to a maximum of 9 months in total, subject to approval. Employers can apply to extend existing contracts and/or apply for approval for new contracts of anything up to 9 months. In both cases, the employer must provide evidence to the Ministry of Labour of the reason for requiring a temporary contract, and do so at least 5 days before the contract starts or the end of the current term expires (although it is advisable to notify sooner as it can take a while for the approval to be granted).
Brazil: Dismissal protection for guardians of new-born children in the event of the mother's death
A new law came into force at the end of June 2014 extending job tenure to guardians of new-born children in the event of the mother's death. In Brazil, new mothers have job tenure which means that they cannot be terminated (except in very limited circumstances) from the confirmation of the pregnancy until five months after giving birth. This new law extends that protection to the child's guardian if the mother dies, for the same period available to the mother, and regardless of whether the guardian works for the same or different employer to the mother. Employers should be aware that new fathers could be entitled to such tenure in the sad event of the mother's death.