Brazil: Termination of employment

Updating authors: Patricia Barboza and Maury Lobo, CGM Advogados

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Summary

• In all cases of dismissal or resignation, the employer must pay the employee their wages owed up until the termination date, along with other accrued pay-related entitlements. (See General)
• Except in cases of summary termination of the employment contract "with cause", statutory notice periods must be observed for dismissal or resignation. (See Notice periods)
• The employer or employee can generally terminate an employment contract at any time and without any particular reason, by giving proper notice. (See Termination without cause)
• Statute provides that an employer is entitled to dismiss an employee summarily on grounds of various types of misconduct on the employee's part. (See Termination with cause)
• An employment contract can be terminated by mutual consent. (See Termination by mutual consent)
• There is no legal concept or definition of redundancy, and a dismissal on grounds of the employee's redundancy would take the form of a dismissal without cause. (See Redundancy)
• As an exception to the general rule that employers may dismiss employees at any time, with the proper notice and severance package, employees in some situations may not be dismissed without cause, or in certain cases may not be dismissed at all, for as long as certain circumstances continue. (See Dismissal protection)
• All employees have an individual account with the statutory Service Guarantee Fund (Fundo de Garantia do Tempo de Serviço, FGTS), into which the employer must pay the equivalent of 8% of the employee's pay per month, and employees are entitled to withdraw the balance of their FGTS account as a severance payment in certain circumstances. (See Severance payments)
• Employees who believe that the employer has not complied with statutory requirements in relation to their dismissal have two years after the termination date to bring a claim in a labour court. (See Dismissal and the courts)