A proposal for Constitutional Amendment was approved and will increase labor rights for domestic employees.

The main objective of the proposal to amend the Federal Constitution is the equality of rights between domestic employees and other employees. Previously, the rights foreseen in article 7, sole paragraph of the Constitution, already granted to domestic employees the minimum salary, irreducible salary, 13th salary, weekly paid day off, holidays, maternity leave, paternity leave, period of notice and retirement.

The new rules, which depend only on their publication in the Official Gazette, will include in that list the fixed working hours of 8 hours per day and 44 hours per week, overtime with minimum additional of 50% of a normal hour, extra 20% for night work, payment of 8% to Unemployment Compensation Fund, unemployment compensation, remuneration higher than or equal to minimum salary, prohibition of any discrimination of color, age, marital status or deficiency, besides any other social benefits that shall await further regulation.

These new rights granted to domestic employees will take effect from the publication date and won’t affect previous relations. Thus, for current domestic employees, negotiation of new conditions with the employer shall be necessary. In this sense, it is appropriate for the employer and employee to arrange the  means to control hours worked, due compliance thereof and other contributions, so that labor relationships are properly complied with..

Some common doubts include recording of hours worked, to be noted daily through a registry document, it is recommended the recording of time of arrival and departure, followed by the signatures of employee and employer. For registry of time of domestic employees who stay the night, it shall carried out in such a way that the departure time represents the end of activities for the employee on that day. As to FGTS, a payment that was optional is now an obligation and will incur a significant increase in costs for employers. Accordingly, there is an expectation for regulation in its contribution form.

Just as an example of the process of adaptation of current hires in relation to the amendment, a domestic employee who works from 8:00 to 18:00 with one hour of rest, from Monday to Friday, will work 9 hours per day and 45 hours per week. Thus, this domestic employee shall formalize with the employer an agreement for a compensation due adjustment of one hour beyond the daily 8, besides defining if the employee will work one hour less in one of the days of the week, to respect the limit of 44 weekly hours, or shall receive this additional hour as extra, with a 50% increase.

In case of compensation of hour, for example, the employee may choose to arrive one hour later or to leave one hour earlier, so that the work time shall be from 8:00 to 18:00 with one hour of rest from Monday to Thursday and on Friday it may be initiated at 9:00 or the employee can leave at 17:00, without loss of remuneration.

Each case shall be analyzed so the process of adaption is transparent with the objective of preserving the confidence that must always exist in relation to domestic employees.

The voting process of the Proposal for Constitutional Amendment 66/2012 resulted in approval on March 26, 2013 and the changes are to operate from the date of its publication, by the first week of April of this year.

We are available to clarify any doubts about this and other matters.

For more information please contact Mauricio Tanabe or Cesar Cadena.

Observations in this update about Brazilian law are by Tauil & Chequer Advogados. They are not intended to provide legal advice to any entity; any entity considering the possibility of a transaction must seek advice tailored to its particular circumstances.