Employment relationships in Brazil are primarily governed by the Consolidation of Labour Laws (CLT), Decree-Law No. 5.452/1943, and the labour rights guaranteed by Article 7 of the 1988 Federal Constitution. These are supplemented by collective bargaining agreements (CBAs), which are widespread and can set terms above the statutory floor for a given category of workers.

The CLT sets the minimum standards that every employer must meet, covering areas such as:

• Working hours, rest periods, and overtime
• Minimum wage and payment of wages, including the 13th salary
• Paid vacation and leave entitlements
• The FGTS severance fund, notice, and termination pay

Employers may offer terms more generous than the statutory minimum, but any clause falling below these standards is unenforceable. Non-compliance can lead to fines, back-pay orders, and labour-court claims, which are common in Brazil.

Employment contracts in Brazil may be indefinite (the default) or fixed-term, and are typically registered in the employee's digital work record (Carteira de Trabalho Digital). While verbal agreements can be valid, a written contract in Portuguese is strongly recommended to document job scope, salary, working hours, benefits, and termination terms.

A probationary arrangement is set through a trial contract (contrato de experiência), which may last a maximum of 90 days. It is commonly structured as an initial period of up to 45 days with a single renewal for up to another 45 days. If the employee continues working beyond 90 days, the contract automatically becomes an indefinite-term employment relationship.

The CLT and the Constitution set clear limits on working time:

• Standard working hours may not exceed 8 hours per day and 44 hours per week.
• Overtime is limited to a maximum of 2 additional hours per day and must be agreed in the contract or a collective agreement.
• Employees are entitled to a weekly paid rest (Descanso Semanal Remunerado, or DSR) of at least 24 consecutive hours, preferably on Sundays.
• A rest/meal break of 1 to 2 hours is required for shifts longer than 6 hours (a 15-minute break applies to shifts of 4 to 6 hours).

When overtime or night work occurs, the following premium rates apply:

Brazil sets a federal minimum wage (salário mínimo) that is adjusted annually, standing at around BRL 1,518 per month in 2025. Some states set higher regional minimum wages (piso regional), and collective agreements often establish higher category floors.

A defining feature of Brazilian pay is the mandatory 13th salary (Décimo Terceiro). Every employee is entitled to an extra month's salary each year, paid pro-rata based on months worked. It is normally paid in two instalments: the first by 30 November and the second by 20 December. Social security (INSS) and income tax are withheld from the second instalment.

The CLT and the Constitution guarantee several categories of paid leave. Employers and collective agreements may offer more, but not less, than these statutory minimums.

Brazil observes around 12 national public holidays each year, in addition to state and municipal holidays that vary by location. National holidays include New Year's Day, Tiradentes Day (21 April), Labour Day (1 May), Independence Day (7 September), Our Lady of Aparecida (12 October), Proclamation of the Republic (15 November), and Christmas Day, among others.

Some dates, such as Carnival Monday and Tuesday and Corpus Christi, are treated as optional ("ponto facultativo"), and local practice varies. Employees required to work on a public holiday are generally entitled to the applicable holiday premium (see the overtime rates above) or a compensatory day off.

A central feature of Brazilian employment is the FGTS (Fundo de Garantia do Tempo de Serviço), a severance guarantee fund. Every month, the employer must deposit an amount equal to 8% of the employee's gross monthly pay (including the 13th salary and vacation pay) into a dedicated FGTS account held with Caixa Econômica Federal.

For open-ended contracts, dismissal generally requires prior notice (aviso prévio). The base notice is 30 days, increased by 3 additional days for each full year of service, capped at 90 days total. Notice may be worked or paid in lieu. On a dismissal without cause, the employer also pays a penalty of 40% of the total FGTS balance accrued during employment. The table below summarises the main termination scenarios:

Hiring in Brazil requires careful adherence to the CLT, the Constitution, and any applicable collective bargaining agreement. Meeting the statutory minimums on working hours, wages, the 13th salary, vacation, FGTS, and severance—while staying alert to frequent legislative changes—builds a strong, compliant foundation for your workforce. Given the activity of Brazil's labour courts, consider working with an HR partner experienced in Brazilian labour law to ensure a smooth and compliant hiring process.

Book a call with us today to learn how we can support your hiring needs in Brazil.