With the revocation of Executive Order No. 905/2019 by Executive Order No. 955, published on April 20, the changes and innovations it promoted, such as the institution of the Green and Yellow Employment Contract, were lost. According to a statement by President Jair Bolsonaro himself on the social media, the revocation was due to the imminent expiry of Executive Order No. 905/2019. Companies that had already made adjustments in their practices, procedures, and policies based on Executive Order No. 905 should adapt them.

In any case, the president advanced that he will issue a new executive order to deal specifically with the Green and Yellow Employment Contract to encourage job creation.

The original text of Executive Order No. 905, published on November 12, 2019, had implemented various changes and innovations in social security, labor, and tax laws and regulations, among which we highlight (more details here):

  • The possibility of hiring employees through the Green and Yellow Employment Contract, with a significant reduction in the charges levied on the remuneration of these individuals, stimulating the generation of employment and income.
  • Changes in the rules on Profit Sharing (PLR), bringing about greater clarity regarding existing provisions in the law and modifying points of its application, including waiving some formalities, such as participation of the labor union in negotiations through an employee commission.
  • Changes in the rules for granting food vouchers to expressly clarify that the provision of food to employees, whether in natura or through vouchers, coupons, checks, electronic cards intended for the purchase of meals or food, is not of the nature of salary and that no social security contributions, FGTS, and IRRF is levied on it
  • Changes to bonus payment rules to resolve the controversy over the "liberality" requirement created by Cosit Solution of Consultation No. 151/19. However, the changes restricted the frequency payment of bonuses to four times in the same calendar year and once in the same quarter.
  • Changes in the rules regarding work on Sundays and public holidays and paid weekly rest to allow work on Sundays and public holidays, in short, authorizing only the right to weekly rest of 24 hours, preferably on Sundays. With the changes, it was also provided that enjoyment of the weekly paid break schedule on Sundays must be (i) one Sunday every for four weeks of work for the retail and services sector; and (ii) one Sunday every seven work weeks for industry.
  • Changes in the work hours of bank employees that increased them from six to eight hours per day, except for bank employees working as cashiers.
  • Changes in the index for adjustment for inflation and in the interest applicable to labor debts, which would be based, respectively, on the IPCA-E (and not on the TR) and on the interest applicable to savings accounts (instead of 1% per month).
  • Changes related to stop work and shutdown orders, in order to adjust outdated names, change the deadline for filing appeals such orders, and revoke (i) article 160 of the Consolidated Labor Laws, which required new establishments to undergo an inspection and approval of their facilities by the competent regional occupational safety and medicine authority before commencing their activities; and (ii) the obligation for companies to notify the Regional Labor Office in advance of substantial changes in facilities for a new inspection.
  • Changes in the rules regarding inspection by labor inspectors and the imposition of administrative fines related to labor laws and regulations, especially related to the criteria for the application of double visits and the application of administrative fines according to the nature of the offense (light, medium, severe, or very severe).

We will continue to monitor the evolution of this topic and any developments.