Among its main pillars, the Labor Reform sought to a) clarify controversies regarding the concept of time at the disposal of the employer; b) give greater autonomy to workers; c) debureaucratize some mandatory procedures for companies; and d) strengthen and encourage collective bargaining, the much-publicized principle of "negotiations over legislative mandates”.

With respect to the first point, there was much controversy over what were considered working hours, due to the broad concept of "time at the disposal of the employer", brought in by article 4 of the Consolidated Labor Laws - CLT. There was no clarity about some activities, such as breakfast offered by companies and the time spent changing uniforms.

The new legislation narrowed down the concept of time at the disposal of the employer, stating that minutes spent on activities carried out at the company's premises, at the employee's personal option, are not a part of working hours. Breakfast and changing uniforms will be a part of work hours only if employees are unable to perform these activities at home. That is to say, if there are work meetings during breakfast or uniforms require special hygiene, for example, these periods will be computed as a part of employees' working hours. If not, then they are not.

Regarding the autonomy of workers, the second pillar of the Labor Reform, the new legislation stated that employees in general are able to negotiate with employers with respect to some issues relating to their day to day work. And it identified a select group of employees, namely those with a university education and a salary greater than two times the ceiling of the highest Social Security benefit level, as being able to negotiate a more comprehensive level of working conditions, given their greater discernment and higher level of education.

This is a recognition of the maturity of employment relations, which removes the presumption of invalidity attributed to agreements and commitments made individually between workers and employers. This recognition relates mainly to issues of working hours, authorizing, for example, individual negotiation of monthly compensation schemes and semiannual or annual, as the case may be, compensatory hours banking.

With regard to the debureaucratization of procedures, the third pillar of the Reform, it is worth highlighting the computerized delivery of documents related to unemployment insurance and FGTS account activity and the end of the requirement of ratification of terminations of employment contracts by the trade union of the professional category.

The application of the new rules to the daily life of workers and employers based on the three abovementioned pillars of the Labor Reform depends on a careful evaluation of the collective rules that guide this relationship within the professional and economic categories or within the scope of the companies.

This is because the fourth pillar of the new legislation seeks to encourage collective bargaining. And the principle of negotiations over legislative mandates is not restricted only to contractual provisions that seek to relax or modernize employment relations. It also extends to those contractual provisions that aim to bureaucratize them or make them more antiquated, including to apply the previous labor law.

A good number of collective bargaining agreements contain contractual provisions that repeat texts of law or recognize concepts of limitations on individual negotiations that were then integrated into employment relations. If these conditions are integrated into collective rules, they will probably be understood as prevailing, even if they are at odds with what was sought with the Labor Reform. Hence, negotiations over legislative mandates.

Below we will cite some contractual provisions commonly identified in collective bargaining agreements that may contradict the new labor legislation and prevail over it:

  • "The companies undertake to ratify with the union terminations of employment contracts with their employees who have more than one (1) year of service."


  • "Companies may establish an hours bank, provided that it is approved by a general meeting of employees."


  • "Regardless of whether public transport is available or the workplace is easily accessible, commuting time is set at one hour per day, which will be computed into the employees’ working hours."
  • "The company will provide breakfast to the first shift, the time for which is set by the parties at ten (10) minutes a day and will be a part of the employees’ working hours."


  • “Companies in the economic category may only outsource activities not related to the core business, and the use of outsourced labor is prohibited for activities relating to the core business.”


  • “Vacation will be granted, by the act of the employer, in a single period. Only in exceptional cases shall vacations be dividied into two (2) separate periods, one of which shall always be equal to or greater than ten (10) days.”


  • “The minimum limit of six (6) hours per day and thirty-six (36) hours of work per week is established for employees of companies of the economic category."


  • "In any continuous work, whose duration exceeds six (6) hours, it is mandatory to grant a break of at least one (1) hour. If the employee does not fully enjoy the break, he shall be entitled to one (1) hour of overtime."


  • "The provisions of this collective agreement are a part of individual employment contracts and can only be modified or abolished through collective bargaining."

Thus, decisions such as establishing individual hours bank agreements for semiannual hours or not considering breakfast as being within the employees' workday can generate undesirable labor liabilities if the agreement or collective bargaining agreement requires different behavior.

For this reason, it is essential that employers' unions and employers carefully analyze their collective rules to find any conflicts with the new text of the law and identify opportunities to revise the contractual provisions in order to adapt them to the new reality brought about by the Labor Reform.