How To Hire In Brazil

Brazil has emerged from the pandemic successfully with a (close to) 5% jump in investments around last year. Brazil’s job market has recovered speedily, thanks to a boost in sectors such as agriculture. 

The hiring market is looking up thanks to efforts from the government welfare schemes. Adaptability to the latest working methods and ample comfort in employing tech among workers in Brazil are further reasons for the country’s strong emerging economy. This also backs the interest in recruitment and selection in Brazil.

The country currently has a gross domestic product of USD 1.43 Trillion. Investors or employers from abroad can tap the young population of Brazil. This is because the younger population comprises about one-third of Latin America’s youth population. 

A British Council report deduced that the English-speaker percentage in Brazil in the 18-24 year age group stands at double the country average. The workforce is adaptable to international working norms. 

Companies can hire from Brazil’s talented workforce for expanding businesses. Learn how to recruit employees in Brazil.

Things to Know Before Hiring in Brazil

Before hiring staff and initiating recruitment and selection in Brazil, you should know the laws and culture that dictate the process.

• All standard hiring practices related to recruitment and selection in Brazil must be in tune with the

1. 1. Consolidacao das Leis do Trabalho or CLT
   2. Federal Constitution of 1988

• Brazil also offers employee-friendly labor code provisions that might lead to lawsuits if employees are terminated. Firing decisions must be calculated well and avoided in the best way possible.
• Brazil follows a hierarchical structure in the workplace.
• Personal relationships form the basis of good professional relationships in the Brazilian work world.

Employment-related must-knows

When you begin with the hiring process in Brazil, understand the related employment practices, which are as follows-

• Across every part of the recruitment process in Brazil, there is a clear agenda against bias and discrimination. Employers must be careful even about making causal statements. For example, a simple phrase such as “young workforce” might be considered age bias.
• The country also enacted the Inter-American Convention on Racism and Hate Speech in 2017.
• While most top cities in Brazil have a sizable English-speaking population, Portuguese is still the dominant language, with Spanish creeping into second place.

Employment contract

In Brazil, employment contracts are not mandatory. However, an employee record book is compulsory. All workers employed must be recorded with all identity details, job profiles, and payroll in the record book.

If and when an employer chooses to draft a contract, it could be of the indefinite type or fixed term only until two years duration. The language used needs to be Portuguese, with details about the job role, salary, benefits, security on offer, and leaves.

Probation 

• The maximum probation period in Brazil is 90 days.  

Termination and notice period

• Employees can be terminated by giving a month’s notice for employees having worked up to a year, with cause. For employees who have worked longer, three days are added. This is in addition to the 30 days for each extra work year added to the notice period.
• Non-causal dismissal brings in the compulsion to make severance pay at 40% of the severance fund in employee accounts as well as additional vacation and leave allowances. 

Working hours and breaks

Employers must follow the specified working hours mentioned in the labor law while hiring staff in Brazil. 

• The standard working hours are eight hours every day or 44 hours every week.
• A lunch break of an hour is allowed on an unpaid basis.
• Overtime is capped at two hours per day.

Payroll

• Salaries are paid monthly to employees in Brazil.

Minimum wage

• Brazil has a minimum wage of R$1300 per month.

Maternity & Paternity leaves

• Women get 120 days of paid maternity leave after childbirth or adoption. 
• An employer can grant additional 60 days of paid maternity leaves to mothers. The payments can be recovered from the tax benefits granted by the federal government.
• Employees must have worked for at least three months to avail of this leave.
• Fathers can take five days of paid leave after a child’s birth. Employers can also extend the paternity leaves with an additional 15 days of paid paternity leaves from the tax benefits granted by the federal government. 

Annual leave

• An employee can take 30 days of paid vacation that can be taken in slots of at least 15+5+5 days.
• Employees must have worked at least a year at the company to avail of this leave.

Other leaves

• Employees may take up to 15 days of sick leaves.
• An extended period of sick leave is allowed with payment from the INSS or Social Security.
• Employers also provide two days of bereavement leave.

Holidays for employees             

The list of public holidays in Brazil are-

* signifies holidays that might be given at the employer’s discretion.

Social security

The social security system in Brazil considers contributions as 

• Employer contribution ranges between 26.8% and 28.8%, wherein 20% is allotted to National Social Security Institute (or the INSS) specifically.
• Up to 8.8% is contributed explicitly towards other taxes for social security.

Taxes

The rate for VAT is 17%.

The Cost of Hiring an Employee in Brazil

The recruitment fees in Brazil vary as per the industry. The standard costs to account for the recruitment process in Brazil are as follows. 

• Job advert expenses
• Background check costs
• Onboarding and training expenses 
• Legal and paperwork expenses
• Translator’s cost (optional)
• Taxes for payroll
• Salary and benefits paid
• Insurances and bonus payments

What Does a Company Need to Hire Employees in Brazil?

When employers engage in hiring in Brazil, you must consider the business model. Here are the top things to check when hiring in Brazil-

• Company incorporation types and norms
• Company seal and trademarks, if relevant
• Bank account costs
• Visa expenses
• Company registration
• Social security registration
• Record keeping and taxation expenses

Various Options for Hiring Employees in Brazil                                                       

When you decide to begin recruitment in Brazil, you have a couple of options-

• You could set up an internal team to conduct hiring as per the general norms of the industry.
• Another option could be hiring a global EOR service provider as an Employer of Record (EOR). Multiplier is one name to bank upon without directly needing an entity in Brazil.

The Steps to Hiring in Brazil

The basic steps for recruiting in Brazil are generic, and the process could vary per industry rules. The typical steps for the hiring process in Brazil are as follows.

1. Make a post of a job opening

• Skim through a pool of candidates who might fit your job opening from job boards and employment portals.
• Additionally, post the opening with precise details on qualifications, job role expectations, and experience on social media channels such as LinkedIn and job boards.

2. Get in touch with the potential employee

• Discuss the opening and its suitability with candidates you have shortlisted as possible fits. Organize a telephonic interview with the candidate to discuss the same. 

3. Fix up an interview

• Send applicants an email detailing the interview round and its specifics. Mention the norms, if any.
• The hiring team can also conduct an assessment or skill test depending on the job post requirements.

4. Final candidate selection

• Selected candidates are informed of the final decision via phone or email. 
• After sharing the offer letter, the candidate is handed a formal contract or record-keeping book entry.
• The details for training and onboarding are then shared with the candidate.

Let Multiplier be Your EOR Platform in Brazil

Recruiting employees can take time and effort. It takes precision, patience, and perfection to close in on the right candidate for a job.

Choose a reputed PEO-EOR platform, such as Multiplier, to easily sail through the recruitment process in Brazil. The team tackles all aspects of the recruitment process in Brazil with the aid of SaaS-based Employer of Record solutions to recruit talent without setting up a business entity in the country. Multiplier may aid employers in grasping all local laws for closing in on the hiring process in Brazil.