Provisional Measure (MP) Adapts Labor Legislation To Meet Business Demands Arising From The Covid-19 Pandemic

Published in an extra edition of the 22nd March 2020, Provisional Measure (MP) No. 927/20 regulates the adjustments in the labor laws announced by the government to minimize the impact of the establishment of the state of public calamity until December 31, 2020 due to the coronavirus pandemic.

The rule establishes that, during this period, the agreement between employer and employee will prevail over any other legal act, provided that the agreement is signed in writing, aimed at maintaining employment and obey the limits provided for in the Federal Constitution.

In addition, it suspends the payment of the Severance Pay Fund (FGTS) for the months of March, April and May (payable in April, May and June respectively). The FGTS for these months may be paid in up to six months, without incurring fines and other legal charges. Payment starts in July and must be made on the seventh day of each month.

It also postpones the performance of occupational, clinical and complementary medical examinations. The postponement will not occur if the physician coordinating the Occupational Health and Medical Control Program evaluates that this puts the health of the worker at risk. Dismissal exams, on the other hand, will only be waived if the last medical exam was done less than 180 days ago.

For companies dealing with the interruption of face-to-face services, the measure eases some instruments already provided for in the legislation. Teleworking, for example, is now allowed regardless of the provision in individual or collective agreements and prior registration of changes in the employment contract. Interns and apprentices can also work in the home office.

Individual holidays can be granted whether the acquisition period has elapsed or not. Companies are still allowed to accept or not the employee’s vacation redemption. Workers in the health sector or in functions considered essential can have their vacations and unpaid leave suspended.

In the case of collective vacations, restrictions established in the Consolidation of Labor Laws (CLT) are abolished. Prior communications to the Ministry of Economy and trade unions are also waived.

Both changing the work regime and anticipating vacations and holidays require that the worker be notified at least 48 hours in advance. This notification can also be made electronically.

The interruption of activities may also be compensated by the creation of a bank of hours through a formal individual or collective agreement, even if not provided for in a convention or work agreement. Compensation must be made within 18 months after the state of public calamity has ended and can be done by extending the workday by up to two hours a day, as long as it is restricted to 10 hours a day.

The MP also brought something new: the possibility of suspension of the employment contract for four months, during which the employer does not need to pay wages. The negative impact of this announcement made the government announce the revocation of this provision.

It is important to remember that provisional measures have immediate effects, but depend on approval by the Legislative Branch, which can change or even reject them. Congress has up to 120 days to approve an MP. If the deadline is not observed, it will expire.