Labour & Employment | Edition 35

06.10.2026

Key Highlights

40-Hour Working Week. Tax Relief and Incentives for Employers.

Bill (PL) No. 3,261/2026, currently under consideration by the Chamber of Deputies, proposes temporary measures to offset the economic impact of reducing the working week from 44 to 40 hours should the end of the 6×1 working schedule be approved. The initiative covers small businesses, rural employers and other labour-intensive employers to be defined by the Executive Branch. Among the benefits, the Bill provides for relief from employers’ social security contributions on salaries for 5 years, extendable by specific legislation, as well as subsidised credit facilities for modernisation, productive reorganisation and professional training. The proposal also requires the submission of a supplementary bill containing tax measures, including a temporary reduction of at least 50% in Corporate Income Tax (IRPJ) and Social Contribution on Net Profit (CSLL) for the small businesses covered. In order to qualify for the incentives, employers will be required to demonstrate the implementation of the reduced working week without any reduction in salary, the maintenance or expansion of formal employment levels, a relevant economic impact and compliance with tax, social security and labour obligations. The Bill still requires approval by the Chamber of Deputies and the Federal Senate and may undergo significant amendments, or even lose political momentum, following the conclusion of the country’s electoral process at the end of October. Source: Chamber of Deputies

Accident-Related Employment Protection for Football Player Following Sports Injury.

The 6th Panel of the Regional Labour Court of Minas Gerais (TRT MG) upheld an order requiring a football club from Minas Gerais to pay compensation corresponding to 12 months of accident-related employment protection to a Paraguayan female player who suffered a knee injury during an official match. Although the contract was for a fixed term and the athlete had not received accident-related sickness benefit, the Court recognised her entitlement on the basis of evidence that the injury arose from her professional activities. Her subsequent engagement by another club and the absence of a request for reinstatement also did not preclude the compensation. In addition, payments made in respect of image rights were recognised as salary due to the absence of evidence of their actual commercial exploitation. The case highlights the need for clubs and sporting organisations generally to assess accident-related employment protection before terminating athletes’ contracts, including fixed-term contracts, and to document the commercial exploitation underpinning payments for image rights, thereby avoiding legal risks associated with compensation and reinstatement claims. Source: TRT MG

Appearance-Based Discrimination.

A company was ordered by the 6th Labour Court of Porto Alegre, State of Rio Grande do Sul, to pay compensation for moral damages to a worker who withdrew from a receptionist position after being subjected to discrimination because he had bleached hair and a bleached beard. Despite having been approved in the interviews, the pre-employment medical examination and the onboarding process, the professional was instructed either to change his appearance or to take up an internal role with no contact with the public. The Labour Court held that the requirement was discriminatory and that the candidate’s refusal constituted the exercise of his right not to accept working conditions different from those initially offered. The case highlights the need to review candidate admission criteria and procedures before the approval and formal hiring stages, as well as to provide guidance to recruitment and management teams in order to avoid requirements that may be considered discriminatory or unjustified during onboarding processes. Source: TRT RS

Broad Standing of Trade Unions to Defend Workers.

The Superior Labour Court (TST), in its judgment of Theme No. 27 concerning repetitive appeals, established a binding precedent recognising the broad standing of trade unions to defend the individual or collective interests of the relevant category, including cases involving a single worker, during the merits, quantification and enforcement stages of proceedings. According to the Court, trade union representation does not depend on authorisation from workers and covers both members and non-members. The Court also established that the need to examine individual circumstances, such as whether a particular worker falls within the group of beneficiaries of the decision or the individual calculation of the amounts due, does not prevent the processing of collective claims or enforcement proceedings brought by trade unions. The ruling, which is aligned with Theme No. 823 of the Brazilian Federal Supreme Court (STF), is expected to guide decisions by the Labour Courts at all levels. For companies, the decision requires particular attention when conducting their defence, as the individual nature of the right in dispute and the need for specific calculations will not, by themselves, be sufficient to challenge a trade union’s standing. Source: TST

Discriminatory Dismissal Due to Chronic Illnesses.

Bill (PL) No. 3,100/2026 has been introduced in the Chamber of Deputies and proposes prohibiting the dismissal of employees on grounds related to autoimmune or chronic illnesses, such as lupus and fibromyalgia. Under the proposed wording, a dismissal will be presumed discriminatory when it occurs after the company has been formally informed of the diagnosis, treatment or need for workplace adjustments, and the employer will bear the burden of demonstrating legitimate grounds for the termination that are unrelated to the illness. Where discrimination is established, the employee may choose either reinstatement, with payment of the amounts due for the period away from work, or payment of twice the remuneration corresponding to that period. The proposal also provides for temporary adjustments supported by a medical certificate, including flexible working hours, remote working, time-banking arrangements and the reorganisation of targets. Any refusal must be justified in writing on objective grounds, and medical information must remain confidential. The Bill, which is still at a preliminary stage, will be considered by committees of the Chamber of Deputies and the Federal Senate before it may become law. Companies should monitor this initiative due to its potential impact on the management of terminations, requests for workplace adjustments and the protection of employees’ health data. Source: Chamber of Deputies

Employment Relationship Not Established in the Context of Family Relationships.

The 2nd Panel of the Regional Labour Court of the 2nd Region (TRT SP) upheld a decision rejecting the recognition of an employment relationship involving a woman who cared for her elderly mother-in-law, who had Alzheimer’s disease. The Panel held that the activities were performed within a context of family cooperation motivated by emotional and family ties. At the hearing, the claimant herself admitted that she would not have been subject to any penalty had she ceased providing the care, a circumstance that demonstrated the absence of legal subordination. The Court also held that the financial payments received from family members did not constitute salary within that context of mutual assistance. The case reinforces the importance of assessing the specific circumstances in which services are provided and the presence of the requirements for an employment relationship, particularly legal subordination, in order to distinguish family cooperation from paid employment as a caregiver. Source: TRT SP

End of the 6×1 Working Schedule Approved by the Senate’s Constitution and Justice Committee.

The Senate’s Constitution and Justice Committee (CCJ) approved Proposed Constitutional Amendment (PEC) No. 221/2019, which reduces the maximum working week in Brazil from 44 to 40 hours, in addition to guaranteeing 2 days of paid weekly rest, one of which should preferably be on Sundays, without any reduction in salary. The proposal provides for a two-stage transition: the working week will be reduced to 42 hours 2 months after publication of the amendment and to 40 hours after 1 year and 2 months. The changes will apply to existing employment contracts and will also preserve minimum salary levels. Collective Bargaining Agreements (CBAs) may provide for the offsetting of rest periods, provided that an average of 2 days off per week is guaranteed each month and that employees receive at least 1 day of rest for every 7 days worked. Incompatible collective bargaining provisions will cease to be valid 2 months after publication of the amendment. Having already been approved by the Chamber of Deputies, the proposal has been referred to the Senate Plenary, where it requires approval in two rounds of voting, with at least 49 votes in favour in each round. Although approved by the CCJ, the conclusion of the electoral process at the end of October may have a decisive impact on the progress and approval of the PEC, depending on the resulting realignment of political forces in the National Congress and the Executive Branch. Source: Federal Senate

Intercurrent Limitation Period Applicable to Enforcement Proceedings Predating the Labour Reform.

The Full Bench of the Superior Labour Court (TST) established a binding precedent under Theme No. 39, holding that the 2-year intercurrent limitation period may apply to claims judicially recognised before the Labour Reform, provided that the creditor’s inactivity results from failure to comply with a court order issued on or after 11 November 2017. In order for the limitation period to begin to run, the notice must specify the action required and warn of the consequences of non-compliance, taking into account the particular circumstances of the proceedings and demonstrating that the proceedings have stalled exclusively as a result of the creditor’s omission. Standardised, automatic or generic notices are insufficient to establish the limitation period. The Court also requires personal service of notice on the creditor, in addition to notice to their lawyer, and guarantees an opportunity to make submissions before the limitation period is recognised, failing which the decision will be null and void. The ruling creates an important window of opportunity for companies involved in labour enforcement proceedings to seek the termination of cases that have remained inactive due to creditors’ inaction and thereby reduce labour-related liabilities. Source: TST

Legal Aid.

The Brazilian Federal Supreme Court (STF), in its judgment of Declaratory Action of Constitutionality (ADC) No. 80, established new parameters for the granting of legal aid, replacing the previous criterion of 40% of the ceiling for benefits under the General Social Security Regime (RGPS), as provided for in the Consolidation of Labour Laws (CLT), with a rebuttable presumption of insufficient financial resources for individuals earning a monthly salary of up to BRL 5,000. This amount will be adjusted in line with updates to income tax legislation or, in the absence of an annual adjustment, by the IPCA inflation index. For individuals earning above this threshold, the granting of legal aid will depend on concrete evidence of financial insufficiency. Even below the threshold, legal aid may be denied where the individual’s assets or household income are incompatible with the alleged financial hardship. The Court also declared Precedent No. 463(I) of the Superior Labour Court (TST) unconstitutional and extended the new guidelines to other branches of the Judiciary, except for first-instance proceedings before the Special Courts. The new understanding will require companies to pay close attention to their litigation practices and may become an important tool for managing and reducing judicial liabilities. Source: STF

Mandatory Remote Working for Employees with High-Risk Pregnancies.

Bill (PL) No. 2,085/2026, currently under consideration by the Chamber of Deputies, proposes amending the Consolidation of Labour Laws (CLT) to guarantee the right to remote working for employees with high-risk pregnancies confirmed by an official medical certificate. Where the employee’s original role is incompatible with remote working, the proposal allows the employer temporarily to modify the pregnant employee’s duties, while respecting her personal circumstances and fully preserving her remuneration. It also guarantees the resumption of her original duties upon returning to on-site work and establishes priority in the allocation of remote-working positions for pregnant employees, persons with disabilities and employees with children up to 4 years of age. The Bill will be considered by the competent committees and will require approval by both the Chamber of Deputies and the Federal Senate before becoming law. Companies should monitor the initiative in view of its potential impact on remote-working policies and the organisation of differentiated working arrangements for pregnant employees. Source: Chamber of Deputies

NR-1. Extension of Suspension Period.

Justice André Mendonça of the Brazilian Federal Supreme Court (STF), reporting Justice in the Claim of Non-Compliance with a Fundamental Precept (ADPF) No. 1316, extended for a further 90 days the suspension of fines against companies for failure to manage psychosocial risks in the workplace as required under Regulatory Standard No. 1 (NR-1) issued by the Ministry of Labour and Employment (MTE). The decision is intended to provide the parties involved with additional tools to reach a negotiated solution to the constitutional dispute. Although the matter remains under consideration by the STF, the new extension will allow employers to use the additional time to assess and address psychosocial risk factors in the workplace while maintaining their compliance timetables, since, notwithstanding the decision in question, the duty to protect workers’ health under NR-1 remains in force. Source: STF

Occupational Health. Non-Consensual Blood Collection from Employee.

A company was ordered by the 1st Panel of the Superior Labour Court (TST) to pay compensation for moral damages to an employee whose blood was collected without her consent after she fainted in the workplace. Upon regaining consciousness, the employee was given the result of a negative pregnancy test and, shortly afterwards, was dismissed during her probationary employment period. Although the Court did not find that the dismissal itself was discriminatory, it held that carrying out the procedure without authorisation violated the employee’s physical integrity and privacy, making the company liable for the conduct of the professional acting on its behalf. The case highlights the need to establish consent protocols within corporate medical services and to provide guidance to occupational health and safety professionals regarding respect for employees’ autonomy and privacy, thereby reducing the risk of civil liability. Source: TST

Pre-Retirement Employment Protection.

An employer was ordered by the 2nd Panel of the Superior Labour Court (TST) to compensate a financial manager who had been dismissed 9 days before meeting the requirements for pre-retirement employment protection. The collective bargaining agreement (CBA) applicable to the category guaranteed such employment protection during the 24 months preceding the date on which the employee would meet the requirements for entitlement to a public retirement pension. Although the employee had not yet formally entered the protected period, the Court held that the dismissal prevented him from acquiring the right. Accordingly, compensation was awarded covering salaries and other amounts due from the date of termination until the date on which he would have completed the minimum period required for retirement. The case highlights the need for continuous and systematic verification of protections provided for in collective bargaining instruments before carrying out employee termination procedures, also taking into account the proximity to the acquisition of such rights and the risk that dismissals may be regarded as intended to prevent the employee from acquiring a contractual right. Source: TST

Psychological Illness Developed Following Employee’s Kidnapping.

The 2nd Panel of the Superior Labour Court (TST) increased the amount of compensation for moral damages payable by an employer to a manager who was kidnapped together with his wife and daughter in order to enable criminals to gain access to the bank branch’s safe. Expert evidence established that the employee developed depression and post-traumatic stress disorder, resulting in temporary total incapacity for work. The support provided by the employer was also considered insufficient, as it was limited to a telephone call 30 days after the crime, with no effective medical, psychological or psychiatric follow-up. In the Court’s view, the previous amount of compensation was negligible in light of the seriousness of the incident and its consequences, justifying an increase in order to ensure proportionate redress and a deterrent effect. The case highlights the need to strengthen security measures and provide effective assistance to employees who are victims of violence related to the workplace. Source: TST