Chamber of Deputies approves New Labor Reform bill, text goes to Senate for validation

Monique Vieira Lessa
Lawyer at Marcos Martins Advogados

Last Tuesday (August 10, 2021), the Chamber of Deputies approved the bill converting Provisional Measure 1045/2021, which initially dealt with the program for reducing and suspending wages and working hours, but had other topics included by the rapporteur, federal deputy Christino Aureo (PP-RJ), with significant changes to current labor rules.

As a result, the Measure took on the appearance of a mini labor reform and will now go to the Federal Senate for a vote, and if approved without changes, it will go to the President for sanction.

Among the main changes brought about in the text of the Law converting the Provisional Measure, the following stand out:

  • The creation of a new type of work for young people aged between 18 and 29, Bolsa Família beneficiaries with a monthly family income of up to two minimum wages and those who have not been registered for more than two years. This modality was called “REQUIP – Special Regime for Incentivized Work, Qualification and Productive Inclusion” and will not give rise to recognition of an employment relationship and will not be considered for any labor, social security or tax purposes.
  • The creation of a program to encourage first-time employment and reintegration into the job market. The program will be called “PRIORE – First Opportunity and Reintegration into Employment” and will be aimed at young people between the ages of 18 and 29 who have never had a formal job and people over the age of 55 who have not had a formal job for more than a year. The main aspect of this program is the lower payment of the FGTS, which is equivalent to 8% of the employee’s salary, while for employees participating in this program it would be between 2% and 6%, depending on the size of the company.
  • A reduction in the percentage of overtime paid to some categories that work reduced hours, such as bank employees, journalists and telemarketers.
  • Restriction of the benefit of Free Justice, which in the case of labor lawsuits would only be granted to those who had a salary of less than 40% of the maximum benefit limit of the General Social Security System.
  • Limiting the power of judges to annul out-of-court agreements. According to the text, the judge would be limited to approving or not approving the agreement in its entirety, and his assessment would be restricted “exclusively to the conformity of the essential elements of the legal transaction”

In addition to the programs instituted and the changes to labor rules, the bill converting the Provisional Measure also creates a new version of the Emergency Employment and Income Maintenance Program for workers whose employment contracts are suspended or whose working hours are reduced due to the Covid-19 pandemic.

Workers will be guaranteed payment of part of their unemployment insurance, which will be valid for 120 days from the date of the Measure, and can only be extended by the Executive Branch for pregnant women.

Marcos Martins Advogados will continue to monitor the progress of this bill, maintaining its commitment to informing and advising its clients on any and all legislative changes.

Any questions? Talk to our lawyers and get advice.

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