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How to manage human resources in Brazil?Posted 05/08/2022
In recent years, many foreign investors have turned their attention to business opportunities in countries like Brazil. But when they get in touch with the way of managing human resources in the country and the labor laws, fear may appear.
On one side, as the country is the eighth economy in the world and interesting for the growth of businesses, on the other side, the nation presents challenges.
In general, the greatest challenges are related to labor laws. In many cases, they strongly protect the employees, but put companies under adverse conditions to operate with flexibility.
Due to these hindrances, it is fundamental to understand the practices for management of human resources in Brazil and for hiring employees in order to meet the legal requirements.
Thus, proceed reading this article of the Europartner Blog and check how to hire talents for your company in Brazil in a smoother way!
Requirements for a company to hire employees in Brazil
Before starting the human resources hiring phase, validate the opening of your business in the country. Thus, the company must be lawfully incorporated in Brazilian territory. To open a branch of your company, you must achieve special authorization of the Ministry of Development, Industry and Foreign Trade of Brazil, which slows down the process.
Due to this reason, most of the companies choose to define a subsidiary, with the option for assuming one of the nine corporate structures available.
To establish a subsidiary, investors must provide the documents below:
- Articles of association;
- Individual taxpayer ID (CPF);
- Registration in the Chamber of Commerce;
- State registration for tax collection;
- Registration in the National Social Security Institute (INSS);
- Bank account in Brazil;
- Authorization for issue of Invoices (AIDF);
- Specific permit for operation in the municipality where the company will operate;
Rights and benefits of workers in Brazil
Also, before starting hiring human resources, be aware that the employees have labor rights and benefits granted by law. These rights and benefits may change according to the category of each employee; the most common ones include:
- Celetista: employee formally hired with CTPS (contract or book) signed, ruled by the Labor Laws Consolidation (CLT). Together with the Federal Constitution of 1988, CLT defines and guides all the Brazilian labor laws.
- Self-Employer: it is a professional that provides services to one or more companies without employment bond (celetista).
- Cooperative worker: affiliated to a cooperative or performs in partnership with an employer.
- Trainees: newly graduated entering the job market.
- Interns: students of technical school or college hired for part-time job.
- Home worker: professional that performs domestic job. CLT sets specific provisions for home workers, who are entitled for many of the benefits established in law.
In case of workers ruled by CLT, benefits and rights are assured and must be granted by employers in Brazil. Check some of these benefits below:
- Minimum wage by worker category
- Maximum eight working hours a day/44 hours a week
- Employees and employers must contribute with the official Social Security. Depending on the employee’s compensation, contribution rates range from 8% to 11%. Employers deduct the employee’s quota of contribution in the payroll and pay their own quota on behalf of the employee.
- 13rd salary: is an extra salary paid per year. This payment is made in two installments, one between February and November, and the other up to December 20.
- Meals and commute vouchers: companies in Brazil are obliged to pay meals and commute vouchers to their formal employees (celetistas).
- Vacations and medical leave: 30-day vacations (can be divided into 3 periods) and medical leave (up to 15 days certified without being sent to INSS).
- Maternity leave: female employees are entitled to 120-day paid maternity leave. This period can be extended for more than 60 days.
- Profit sharing: the employer enters in agreement with the employee’s labor representative, usually unions.
Human resources management tips for hiring employees in Brazil
After considering all the legal aspects for hiring employees, now it is time to start the hiring process. This phase is surely made easier by technology, supported by job announcement platforms and social networks.
In addition, use online interview applications, and obviously count on the expertise of an accounting firm specialized in the incorporation of companies in Brazil.
Europartner has a technical team with wide knowledge and at disposal of your company, to facilitate the incorporation of your businesses in Brazil, including the improvement of human resources management.
Call us and clear your doubts with the team of accountants at Europartner!Author's post: Europartner Accounting