Executive Order No. 1,108 was published on 28 March 2022, changing several sections of the Brazilian Labour Code regarding the nation’s remote work system. Below are the main changes brought about by the Executive Order:
- Concept of remote work system: Before the publication of the Executive Order, the remote work system was characterised only when the employee worked predominantly outside the company’s premises using information and communication technologies. This type of activity was considered telework and sections of the Labour Code were only designed for employees in telework. However, after its publication, the remote work system is characterised for telework employees (who carry out most of their working days/hours working remotely), but also when the employee works just a few days remotely (i.e., only one or two days per week). Moreover, in accordance with the Executive Order, the attendance of the employee in a habitual basis to the company’s premises, does not mischaracterise the remote work system. With this change, the hybrid system, very common after the Covid-19 pandemic, is recognised as remote work.
- Working Hours control: Only employees working on telework or remote work systems, who provide services by production or tasks, are exempt from working hours control. Employees hired per hour (hourly or monthly), as a rule, must be subject to working hours control, except if they fit another exemption (e.g., an employee that holds a trust position).
- Individual agreements: The company and the employee may execute individual agreements about working hours and means of communication, provided that the legal rest periods are guaranteed (i.e., break for meal and rest).
- Eligibility: Remote work systems may be adopted for interns and apprentices. Additionally, companies must prioritise the telework/remote work system for employees with disabilities and employees with children up to 4 years old.
- Collective Bargaining Agreement: The collective bargaining agreement applicable to employees working on telework/remote work systems must be the one linked to the company’s premises/location (i.e., linked to the branch of the company in Brazil that has the employee on its payroll).
- Expenses related to the change of work system: If the employee chooses to work on telework/remote work systems at a different location than the company’s location (different place from where he/she was hired), the company will not be responsible for expenses arising from his/her return to work at the company’s premises, unless otherwise agreed by the parties.
- Employees working outside Brazil: Brazilian law will apply to employees hired in Brazil who choose to work on telework/remote work systems outside Brazil; Law 7,064/82 will also apply, depending on the situation.
The Executive Order is valid for 60 days, extendable for another 60 days. During such 120 days, the Brazilian Congress must analyse the matter and decide if it will be converted into law or not. If it is not converted into law, the Executive Order loses its effectiveness and the rules regarding remote work will return to their original text in accordance with the Brazilian Labour Code. The Brazilian Congress may also change the language before converting it into law. In this sense, it is important to continue monitoring the evolution of the matter.
Key Action Points for Human Resources and In-house Counsel
- Confirm if the company applies a remote work system in Brazil (including a hybrid work system) and, if so, verify if the rules set forth for such system are following the current legislation, including provisions of Executive Order No. 1,108;
- We recommend analysing if your remote work employees are subject (or not) to working hours control and define a strategy regarding such matters; and
- Continue monitoring the progress of Executive Order No. 1,108 in the Brazilian Congress.