Is Your US Employment Contract Illegal in Brazil?
What every US company with staff in Brazil must know.
Is Your US Employment Contract Illegal in Brazil?
What every US company with staff in Brazil must know.
✘ Mito
Our US contract says Delaware law governs, so Brazilian rules don't apply.
✓ Verdade
Brazilian labor law overrides any foreign contract for work done in Brazil.
Brazil's CLT applies territoriality: any work habitually performed in Brazil is subject to local law, regardless of employer location. Article 3 defines employee broadly. Your US contract won't protect you.
Can't I just have my employee sign a waiver of Brazilian rights?
No. Rights like 13th salary, 30-day vacation, FGTS are mandatory. Waivers are void in Brazilian courts.
Without a local entity, a Brazilian court may declare a direct employment relationship with your US parent company, triggering retroactive liabilities for years of missed payments and social security.
Dica
Structure a local entity or use a compliant PEO. Intercompany agreements must respect Brazilian law. Never rely on US contracts to govern local work. Consult local counsel early.
13th monthly salary
30-day paid vacation
FGTS (severance fund) deposits
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You cannot contract your way out of Brazilian labor law for work performed in Brazil.
Protect your company from hidden labor risks in Brazil. Get the full compliance roadmap now.