Employees cannot waive credits at the end of the contract
From 2024, the updated Labour Code provides that, when a contract ends or on dismissal, employees cannot waive credits owed by the employer, such as holiday and Christmas allowances, overtime and training. These “waivers” (remissões abdicativas) must be taken into account in calculating compensation on termination and can only be waived through a court settlement, i.e. by agreement in court.
Higher compensation for collective dismissal
In collective dismissals, the employer must notify each affected employee of its intention in writing, and employees are now entitled to compensation corresponding to 14 days’ base pay and seniority payments for each full year of service. The employer is responsible for paying this compensation in full, but the employee may call on the employment compensation guarantee fund, as provided for by law. Previously, compensation was equivalent to 12 days’ base pay and seniority payments.
Limit of four renewals for temporary employment contracts
The Labour Code update reduces the maximum number of renewals allowed for temporary employment contracts from six to four. If a temporary contract exceeds this limit, it will be converted into a permanent employment contract for temporary assignment.
Contact us to find out more.
