Camila Vieira Guimarães
Lawyer at Marcos Martins Advogados
Regarding labor measures to deal with the state of public calamity resulting from the Covid-19 (coronavirus) pandemic, avoiding mass layoffs and aiming to preserve jobs, the government published Provisional Measure No. 936 (“MP 936/2020”) on April 1, 2020, implementing the Emergency Benefit for the Preservation of Employment and Income, a proportional reduction in working hours and wages and the temporary suspension of employment contracts.
Read more about Provisional Measure 936/2020 at:
Provisional Measure No. 936/2020 and the labor changes for companies
On the same day as the publication of Provisional Measure 936/2020, controversy arose regarding the reduction of wages proportional to working hours by simple individual written agreement between company and employee, since the Federal Constitution conditions in its article 7, item IV, the existence of union collective bargaining to reduce wages.
This questioning was taken to the Federal Supreme Court (STF) on April 2, 2020, through the Direct Action for Constitutionality (ADI 6363), which was distributed to Justice Ricardo Lewandowski, who issued an injunction determining that the company and the employee could start negotiations, however, the agreement to reduce wages would only be legal if validated by the labor union through collective bargaining.
However, the injunction was not upheld by the STF on April 17, 2020, considering individual agreements to reduce wages proportional to the reduction in working hours entered into by individual written agreement between the company and employees to be valid and legitimate, and to have immediate effect.
It is important to note that if the company and employee agree on a proportional reduction in working hours and wages, the need to notify the labor union within 10 calendar days of the agreement still remains, under the terms of article 11, paragraph 4 of Provisional Measure 936/2020, under penalty of the agreement being invalid.
The employer must ensure that the agreement is communicated to the Ministry of Economy, also within 10 calendar days of the conclusion of the agreement, under penalty of bearing the full payment of the employee’s wages for the period while the communication has not been made.
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