PEO & Employer of Record (EOR) in Brazil
Expand Your Business With Our Brazil PEO
GlobalPEO delivers a top tier employer of record service for clients that are looking to recruit, hire, and operate payroll services without first setting up their own subsidiary in Brazil.
How it Works: Our Brazil PEO hires your candidate while abiding by local labor laws and cultural customs. The newly hired employee will communicate directly with your company and perform all job functions as if they were your own employee. We act as your in-country HR department and handle the entire onboarding, payroll, and benefits process in strict accordance with Brazil’s regulations.
Why Choose our Brazil PEO?
Without needing to setup a local entity in Brazil, companies save thousands when expanding with GlobalPEO. From $400 USD.
Scale and onboard your workforce in days, not months by using our local entities and experts in Brazil.
Minimize risk by ensuring your company is compliant with local laws and cultural customs and protecting your business from potential fines and legal fees.
Streamlined process for managing your payroll, benefits, and HR responsibilities with full flexibility to make changes at any time.
Brazil PEO & Employer of Record
Hire, onboard, and manage employees in Brazil quickly and easily with GlobalPEO. Working with our Brazil PEO and Employer of Record solution eliminates the headaches that come with establishing a foreign legal entity and guarantees full compliance with local regulations.
Local Employer of Record
Your employees based in Brazil will sign a local employment contract with GlobalPEO's in-country entity. Labor contracts are available in English and Portuguese, with employee payments processed in the local Brazilian Real currency. As the local Employer of Record, GlobalPEO operates with full compliance to the laws and regulations of Brazil's Bureau of Labor.
Payroll Processing
GlobalPEO's complete payroll processing includes:
- New employee setup
- Social Insurance contributions
- Individual income tax declaration
- Expenses declaration
- Payslip provision
- Dedicated payroll officer
- Support for standard employment documents
Employee Onboarding
After officially hiring your local candidate, our Brazil HR team will schedule an onboarding conference call with both the candidate and client. The onboarding process typically takes between 3-5 days.
Legal Liability Coverage
Our PEO solution covers the following functions to take legal liability as the local employer of record:
- Obligatory social and pension insurance enrollment.
-Employee income tax withholding
- Liabilities of early-termination, including severance calculation and mediation.
- Onsite health and safety liability coverage, which is shared with the client
Termination Guidelines
In the event a client decides to pause or end their presence in Brazil when employing staff through our PEO and Employer of Records service, there are no termination fees to be paid as long as the client adheres to the 60 day termination-notice period.
#1 - Fast Facts For Hiring in Brazil
"Position of Trust" Salary Modifications
When negotiating contracts with employees in Brazil, employers have the opportunity to create a "position of trust" contract that essentially gives employees managerial power, which exempts them from receiving overtime payment.
Union Vs. Non-Union Employees
If you hire an employee represented by a Brazilian Union, that employee will expect a 5% - 8% annual salary increase.
Verbal Agreements on Gross Pay
In effort to avoid disagreements later on, it is important to come to a verbal agreement on the gross salary that the employee will receive on an annual basis.
#2 - Working Hours in Brazil
The standard workweek in Brazil is 44 hours, which includes 8 working hours per day M-F and then 4 hours on Saturdays. Some company’s choose to work a few more hours over the course of the week and give their employee’s Saturdays off.
The federal government is heavily involved in the working hours and restrictions placed on employers’ of Brazilian workers, and generally rule in favor of employees in the matter of disputes.
#3 - Brazil's Employment Contracts
The custom for executing strong employment contracts in Brazil is to have a written contract in Brazil’s native Portuguese language, which breaks down the details regarding employee compensation, benefits, and the specifics surrounding termination. Also, the contract state all compensation in the national Brazilian Real Currency.
By working with GlobalPEO’s employer of record service, we take care of the employment contract and help execute hiring efficiently with full regard to compliance with local regulations.
#4 - Brazilian Holidays
There are 10 national holidays celebrated annually in Brazil. These include New Year’s Day, Good Friday, Easter Monday, Tiadente’s Day, Labour Day, Independence Day, Our Lady Aparecida, All Soul’s Day, Republic Proclamation Day, and Christmas.
The majority of Brazil’s holidays are celebrated nationwide, but individual states and cities often have their own holidays that they observe. Election days are observed as federal holidays as well.
#5 - Bonus Payments in Brazil
The customary practice for employers in Brazil is to provide annual bonus payouts instead of monthly commissions. This is often referred to as the “13th month salary” which is a legally required payout that pays employee’s an extra month’s worth of salary over the course of November and December. This is considered to be a benefit and is not a part of the employee’s base salary.
In situations where the majority of an employee’s salary consists of monthly commissions, the payments can be designed to pay a monthly non-recoverable draw, which help cover Brazil’s hefty 80% social charge paid on commission earnings.
Brazil’s bonus and compensation rules can be confusing to company’s operating in countries outside of Brazil. GlobalPEO is happy to help explain these guidelines and also have one of our in-country experts assist with contract negotiations.
#6 - Health Insurance & Employment Benefits
The majority of benefits in Brazil are determined by the Brazilian government, so there are only a couple of benefits that need to be negotiated with the employee during hiring. Health insurance is a natural right given to all citizens, but it is becoming more common for employees to seek private health insurance coverage from their employer.
All employers of Brazilian employees must contribute to a retirement savings fund called the “Fundo de Garantia por Tempo de Serviço,” which will be paid out to an employee if he or she is terminated without proper cause. Additionally, the employer is required to pay a fine of 50% of all money paid to the employee over the course of their contract.
If you wish to provide supplementary medical and dental insurance to your employees working in Brazil, you have the option of doing so through GlobalPEO’s Employer of Record entity located in Brazil.
#7 - Sick Leave in Brazil
Employees are entitled to receive full pay for the first 15 days of absence from work, as long as they provide a doctor’s note stating that they are indeed unable to work. Benefits must continue being provided to the employee during their time away on sick leave.
#8 - Maternity Leave in Brazil
Female employees working in Brazil are granted 4 months’ maternity leave and are legally protected from termination during pregnancy or for the following 12 months after giving birth.
All salary and benefits must continue to be paid to the employee throughout the full duration of the employment protection period.
Private companies have the choice to allow female employees an additional 60 days of maternity leave, which gives employer’s the option to deduct the additional salary expenses from the company’s income taxes in order to avoid assuming a financial burden due to the extended maternity leave.
#9 - Termination & Severance in Brazil
Both the company and the employee have the right to terminate the employment contract at anytime by providing an official written notice of at least 30 days time. Employers also have the right to provide payment in lieu of having the employee continue working through the final 30 days of their contract.
At the end of the employee’s contract, the employer must submit the final payment that includes prorated pay for their vacation, benefits, 13th month salary, bonuses, and overtime.
As mentioned before, all employers of Brazilian employees must contribute to a retirement savings fund called the “Fundo de Garantia por Tempo de Serviço,” which will be paid out to an employee if he or she is terminated without proper cause. Additionally, the employer is required to pay a fine of 50% of all money paid to the employee over the course of their contract. If the employee is terminated for good cause, the company is not liable to pay these penalties
#10 - Brazil's Tax Laws
Employers operating in Brazil must pay a portion of social security and statutory benefits in addition to employee salary in Brazil. We estimate these costs to add an additional 80% to the total salary costs of employing workers in Brazil.
As Brazil’s tax laws are highly complex and can be costly, GlobalPEO’s Employer of Record service will work closely with Brazilian officials to help provide the most economical solution possible to our clients.
Why Choose GlobalPEO?
Global expansion is a great step for your business – and now it’s easier than ever. Setting up your own entity in each country where you wish to operate can be expensive, complicated, and requires deep knowledge of the specific rules and regulations. Let GlobalPEO take care of everything. From International PEO & EOR, Global Payroll and International Recruiting we deliver our exceptional services at an affordable price.