Brazil's President Approves Labor Reform Bill

On July 14, 2017, Brazil's Labor Reform Bill (Law No. 13.467) (the "Bill") was published after it was approved by President Michel Temer. The new law will go into effect on November 11, 2017.

The Labor Reform Bill will make extensive changes to several provisions of the Brazilian Labor Code. The Bill is significant because it represents the country's first attempt to modernize and overhaul labor rules that date back to the 1940s.

Most significantly, the Bill offers more leeway to collective bargaining and provides that agreements negotiated between employers and workers on a range of issues override labor legislation unless such agreements extinguish basic labor rights foreseen in the Federal Constitution (such as, for example, minimum wage, prior notice and FGTS). A collective bargaining agreement will prevail even if there is no express consideration. In doing so, the Bill prioritizes direct negotiations between workers and employers over existing labor