EOR Service in Brazil

Hire, Onboard and Pay Employees in Brazil Quickly and Efficiently

Hiring in Brazil at a glance

CURRENCY
Brazilian Real (BRL)
working hours
40 hours per week
public/bank holidays
13
capital
Brasília
language
Portuguese
date format
DD/MM/YYYY format
remote workers
1.2M
tax year
Calendar year (January to December)
minimum hourly salary
No minimum wage
CURRENCY
Brazilian Real (BRL)
working hours
40 hours per week
public/bank holidays
13
capital
Brasília
language
Portuguese
date format
DD/MM/YYYY format
tax year
Calendar year (January to December)
payroll frequency
Monthly
GDP
$1,608.98B (2021)

Employer of Record in Brazil

Employers of Record (EORs) in Brazil help you hire and pay employees in the country without the need for a local entity. The Employer of Record (EOR) acts as the employer for your Brazilian talent, and takes on the responsibility of compliance risks. This includes managing payroll, taxes, statutory benefits, employment contracts, and other related matters. With all administrative burden taken care of, and manual efforts in hiring and paying across borders removed, employers can easily manage the employee’s day-to-day activities. 

Why use Brazil EOR?

Employers use a Brazil EOR or PEO to: 1) hire and pay employees in the country 2) hire talent without opening a local entity. Employers of Record (EOR) in Brazil provide a quick and effective way to tap into the country's pool of talent. 

Although employers can hire from Brazil by setting up their own infrastructure and payroll processes, an EOR can help you do this in a safe, compliant, and cost-effective manner. This is because of the following reasons:

  1. Setting up an entity to hire talent costs you $11,400. EORs enable you to hire talent without the need to incorporate your business
  2. Employment laws in Brazil have a few distinctive features. For example, employers are mandated by law to pay a 13th month salary (a bonus), usually paid in two installments: one-half at the end of November and the other half by December 20th. Another unique feature is a contribution employers must make to a government-managed fund called the "Fundo de Garantia do Tempo de Serviço" (FGTS. Employers can pay for an employee’s termination when it happens without cause. 
  3. Employers also need to be aware of collective bargaining agreements that may affect minimum wages, parental leaves, etc.

Gloroots’ Brazil EOR, can eliminate any complexities around compliance, and payroll processing. Gloroots offers a single platform that enables you to seamlessly onboard, pay, and manage your employees in Brazil. Moreover, you can offer customized benefits to your employees in Brazil, thanks to Gloroots' local specialists, who carefully select the most suitable insurance options for your company.

EOR Costs in Brazil

The cost of Brazil EOR/PEO services may differ based on various factors, such as the number of employees, the extent of services needed, and the intricacy of the project. The pricing structure for Brazil EOR/PEO services usually involves a monthly fee per employee or a percentage of the employee's salary. Extra charges may apply for additional services or customization.

Key Metrics For Foreign Employers

Brazil's workforce is known for its youthfulness, energy, and high level of expertise, particularly in fields like software development. This abundant pool of talented individuals allows international recruiters to access the necessary skills and knowledge required for their operations.

Refer to the table below to understand Brazil’s talent competitiveness.

Factors Global Ranking Interpretation
Rule of law 71 Indicates effectiveness of law enforcement
Labour-employer cooperation 112 Indicates positive labor-employee relationships
Reading Maths, and Science 67 Indicates average scores in OECD's survey of 15-year old students
University Ranking 29 Indicates average QS rankings
Labour productivity per employee 74 Indicates total output by the total labor input used to produce that output
Ease of finding skilled employees 106 Indicates findability of skilled talent
Workforce with tertiary education 63 Indicates % of workforce with PG degrees
Digital Skills 61 Indicates prevalence of advanced digital skills in the population

Source: The Global Talent Competitiveness Index 2022

Through the Gloroots’ Recrew platform, you can discover amazing talent in Brazil.

Why work in Brazil ?

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How to customize formatting for each rich text

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Grow your team in Brazil

Growing a team means hiring the right employees at the right time and for the appropriate positions. Employers in Brazil must have a local legal organization and use local resources to handle compliance, payroll, tax, and benefits management. The complexity of employment regulations in Brazil makes compliance with employment laws demanding.

With Gloroots’s global Employer of Record (EoR) service, you can let Gloroots do the heavy lifting of payroll, tax, benefits, and compliance and concentrate on what matters to you most: your employees and company growth.

Risks of misclassification

The term "misclassification of employees" refers to the inaccurate classification of workers by their employers. Misclassification occurs when an employer categorizes a worker as an independent contractor or exempts them from certain employment laws and benefits, even if the worker should be classified as an employee and entitled to legal protections, benefits, and rights. Utilizing a PEO/EOR in Brazil helps mitigate the risks associated with misclassification by ensuring compliance with labour laws, proper employee classification, accurate payroll processing, and access to comprehensive benefits. This enables businesses to focus on their core operations while entrusting employment-related responsibilities to experienced professionals.

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Employing in Brazil

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

Headings, paragraphs, blockquotes, figures, images, and figure captions can all be styled after a class is added to the rich text element using the "When inside of" nested selector system.

Tax

Income Range (BRL) Tax Rate (%)
Up to 22,846.76 0.00%
22,847.77 to 33,919.80 7.50%
33,919.81 to 45,012.62 15.00%
45,012.63 to 55,976.16 22.50%
55,976.17 and above 27.50%

OTHER TAX AND SOCIAL SECURITY CONTRIBUTION

Employer payroll contribution

Employer Payroll Contributions Percentage
Social Security contributions (INSS) 20.00% to 24.50%
Employees Severance Indemnity Fund (FGTS) 8.00%
Terceiros (contribution to organizations or programs that help employees in various ways, like social programs or benefits.) 5.8 % (Capped at 20 times the minimum wage)
Vacation bonus 2.78 %
Meal Vouchers 20-50 BRL per working day
Grocery Vouchers (mandatory in some CBAs) 130 BRL per month
Transportation vouchers (sum varies by distance) 350 BRL per month
Total Employment Cost 36.58 – 41.08‬% +1480 BRL

Employee payroll contribution 

Employee Payroll Contributions Percentage or Amount
Up to 1,212.00 BRL 7.50% of salary
1,212.01 BRL to 2,427.35 BRL 9.00% of salary
2,427.36 BRL to 3,641.03 BRL 12.00% of salary
3,641.04 to 7,087.22 BRL 14.00% of salary
Total Employee Contribution 7.50% – 14.00%

Separation

Termination 

Brazilian labor legislation permits either the employer or the employee to provide notice to terminate an employment contract. When a local employee's employment is terminated, it is required that their salary be paid on their final day of work.

If an employee resigns without providing prior notice, their salary for the period they worked must be settled within seven days from their last day of employment. In cases where termination is a result of misconduct, the employee's salary should be settled on their final day of work. In situations where unforeseen circumstances prevent immediate payment, the employee must still receive their salary within three business days.

Severance

In the majority of circumstances, severance compensation is obligatory and consists of the following: 

  • Salary Owed: When an employee's contract is terminated, the employer is responsible for paying any outstanding salary owed up until the date of termination. This includes regular wages, overtime, or any other unpaid earnings.
  • Payment for Unused Vacations: If an employee has accrued vacation days that have not been used, the employer is obligated to provide financial compensation for those unused vacation days. The amount is calculated based on the employee's daily wage multiplied by the number of unused vacation days.
  • Prorated Yearly Bonuses: If the employment termination occurs before the payment of the yearly bonus, the employee may still be entitled to a prorated portion of the bonus. The exact calculation depends on the company's bonus policy and the length of the employment during the bonus period.
  • Accumulated FGTS Deposit: The Guarantee Fund for Length of Service (FGTS) is a mandatory savings fund in Brazil. When an employment contract is terminated, the employer must provide the employee with the accumulated balance in their FGTS account, which includes the monthly deposits made by the employer during the employment period.
  • Extra Penalties: In some cases, additional penalties may apply depending on the circumstances of the termination. For instance, if the termination is deemed unlawful or violates labor regulations, the employer may be subject to extra penalties as determined by Brazilian labor laws.

In Brazil, it is essential for both employers and employees to have a solid understanding of these policies.

Notice period

Duration of Employment Notice Period
Less than 1 year 30 days
1 year or more 30 days + 3 days for each additional year, up to a maximum of 90 days

For example, if an employee has worked for 2 years, the notice period for the employer to terminate the employment would be 33 days (30 days + 3 days for the additional year). If the employee has worked for 5 years or more, the notice period would be the maximum of 90 days.

It's important to note that these are the statutory notice periods, and individual employment contracts or collective bargaining agreements may provide for different notice periods. Additionally, in some cases, employers may be required to provide severance pay or other benefits upon termination, depending on the circumstances and applicable labor laws.

Probation period

Employees and employers are free to negotiate the terms of a probationary period, which must then be written into the employment contract. In Brazil, probationary periods are limited to a maximum of ninety days.

Start Hiring in Brazil today

Gloroots in-house experts handle cross-border employment and payroll compliance, contract generation, on-time payments, and benefits, allowing you to focus on talent screening. We ensure a seamless global employment experience, making your Brazil expansion hassle-free. Contact us to start your global hiring campaign in Brazil today.

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