The effects of the 2017 labor reform have been reduced by the Covid-19 pandemic, with the accelerating growth of displacement and discrimination, and decisions taken by the STF (Federal Supreme Court) and the Supreme Labor Court (TST) against some authorized bodies, according to experts who heard Bound.
A new update of the CLT (Consolidation of Labor Laws) will be necessary, but with widespread debate, scholars say, after eight years of changes.
The reform was approved in July 2017, and went into effect on November 11 of that year. Rules like those negotiated under the legislation — when collective bargaining is worth more than what the law says — separation by agreement, the possibility of a staggered contract and the end of the union tax are seen by supporters of the changes as positive points.
Its opponents criticize the end of free justice – later abolished by the STF and TST – and the lack of budgetary allocations for the maintenance of trade unions and contract flexibility, which in this group’s opinion has made relations unstable.
One of the points of reform was the creation of an intermittent employment contract, where the employee is called by the company when there is a demand, without specific days. If you are working, you have the right to salary and employment benefits, such as FGTS (Fund for Service Time Guarantee), 13th salary and pro-rata leave.
The pandemic has hampered the analysis of this model, says researcher Janina Viejo, from Ibre-FGV (Brazilian Institute of Economics affiliated with the Getúlio Vargas Foundation). Survey conducted by her upon request Bound There appears to be a gradual growth in the participation of this type of contract, which still represents a small share of total formal employment, about 5% annually.
Data through September show a lower percentage, but the professor expects that percentage to increase by the end of 2025. For her, this is a contract that approaches freelancing, with payment on demand, but it does not solve the problem of becoming an Uber.
“This makes (intermittent) work very close to self-employment, but it guarantees some rights that count toward Social Security,” she says. The researcher highlights that sectors such as services and trade have a greater commitment to this type of connection, because they often involve seasonal activities.
Janina states that the 2017 reform did not anticipate the emergence and rapid expansion of new forms of work, such as the shift to work, which intensified during the pandemic, and therefore, he believes that, in the future, Brazil must implement a new labor reform. The aim will be to integrate these modalities and rethink the distinction between self-employed workers with CNPJ and app-related workers, such as drivers and delivery workers.
Paula Montanger, Undersecretary for Statistics and Labor Studies at the Department of Labor and Employment, focused on the discontinuous model. She points out that more than 60% of contracts of this type that exist today do not require the worker to actually provide the service, and therefore there is no payment or contribution to social security.
These contracts are classified as atypical. In Europe, they are called zero hours. He says: “I am forced to report this relationship, but they worked zero hours and did not receive an income. According to any reading of the labor market as confirmed by statisticians, (these contracts) are relationships that did not occur in practice.”
The expert says that the food and events sectors are the ones that use the model the most, as well as trade. “These are activities that actually have intermittent characteristics,” he says.
Another concern relates to fixed-term contracts, which were strengthened after the reform, which classifies them as a form of instability. “In the public sector, especially in education, this has become the norm,” he says. “Substitute and temporary teachers are hired and fired several times a year.”
Employment Tribunal proceedings rise again following STF and TST decisions
The decisions taken by the STF and TST on free justice reversed one of the most well-known effects among reform supporters, namely a reduction in the number of lawsuits in the labor judiciary, while generating savings for companies.
A study conducted by the FGV (Fundação Getulio Vargas), CNI (National Confederation of Industry) and MBC (Movimento Brasil Competitivo) shows that R$15 billion was saved between 2022 and 2024 with the restriction of procedures in the labor judiciary. Now, values should rise again. In 2024, the number of new shares broke a record.
For critics of the reform, restricting access to free justice was one of its harshest points. However, this measure received a dissenting ruling, first, from the Social Security Fund, which decided in 2021 that workers who earn up to 40% of the Social Security ceiling do not need to prove income to receive free benefits.
The TST then specified, in December 2024, that even those earning higher amounts were entitled to free justice, as long as they presented a document proving insufficient income, known as a “poverty certificate”.
What went right and what went wrong in the renovation process?
Another change in the reform was dismissal by agreement, when the employee and the employer reach an agreement to dismiss the employee and he or she is entitled to 20% of the penalty on the FGTS; The employer keeps the other 20%.
The number remains constant year after year, with about 19,000 outages per month, for a total of 240,000 per year, a figure that, even lower than expectations, reflects a certain acceptance of the measure, says Janina Viejo.
Lawyer Larian Del Vecchio, of the law firm Aith, Badari e Luchin Advogados, says that after eight years, some changes in the labor market and the courts have in fact been integrated, but others “have not spread.”
She mentions, for example, the end of restrictions on free justice, as well as the prohibition of imposing adjudication fees – the amount paid by someone who loses a case to the other party’s lawyers – on those who are considered incompetent, that is, do not have the financial ability to pay. They will also not pay for legal expertise when necessary.
Another decision that the STF overturned was a device that allowed pregnant women and breastfeeding mothers to work in environments that pose a risk to their health.
Other points, such as implementing a time bank, reducing lunch hours to 30 minutes, dividing vacations into three periods, separation by agreement and intermittent contracts, will be positive, and are being implemented even after criticism.
Highlights of the negotiated legislation. “In practice, the procedure is successful, and unions and companies use these negotiations frequently. But the rule has not become a ‘carte blanche’. The STF decided, in Topic 1046, that what was negotiated prevails, but it cannot violate fundamental constitutional rights.”
Eduardo Bragmacio Filho, of Furtado Bragmacio Advogados and President of the Brazilian Academy of Labor Law, also highlights what was negotiated on the legislation. “From the point of view of collective law, one of the most important legacies of labor reform lies in the central importance attributed to collective bargaining,” he says.
For him, the new reform is necessary because of changes in the labor market. “The political, economic and social underpinnings when the CLT was created were very different than they are today. Today we experience the democratic rule of law, in a globalized and highly interconnected economy.”
Jorge Bucinhas, a professor at FGV Eaesp (São Paulo Business School affiliated with Fundação Getulio Vargas) and McKinsey Law School, also advocates updating the CLT, but not along the lines of the 2017 update.
The idea would be to produce a “code” rather than a standardized code, as happened with the CLT itself in 1943.
“Even the CLT was born unsystematically, because it is a standardization, not a code, and we did a lot of tricks. We need to amend labor legislation,” he says.
cooperated Julia Galvao
About The Author
