Operating a Business

flag Brazil Brazil: Operating a Business

In this page: Legal Forms of Companies | The Active Population in Figures | Working Conditions | The Cost of Labour | Management of Human Resources


Legal Forms of Companies

Sociedade de Responsabilidade Limitada (SARL): Limited Liability Company
Number of partners: 2 partners minimum.
Capital (max/min): No minimum capital requirement.
Shareholders and liability: Liability is limited to the amount of capital contributed. Partners are also jointly liable for the company's commitments within the limit of the capital remaining to be paid up.
Sociedade Anônima (SA): Public Limited Company.
Number of partners: 2 partners minimum.
Capital (max/min): No minimum capital requirement.

10% minimum of the issue price of the subscribed shares must be paid up in cash.
Shareholders and liability: The partners' liability is limited to the amount of capital contributed.

General Partnership
Number of partners: 2 partners minimum.
Capital (max/min): No minimum capital requirement.
Shareholders and liability: The partners' liability is limited to the amount of capital contributed.
Sociedade em Comandita Simples (SCS): Limited Joint-Stock Partnership
Number of partners: 2 partners minimum.There are two types of partners - active partners and the silent partners.
Capital (max/min): No minimum capital requirement.
Shareholders and liability: The liability of the active partners is unlimited. The liability of the silent partners is limited to the amount of capital contributed as long as they do not participate in the management of the company.

Business Setup Procedures

Setting Up a Company Brazil Latin America & Caribbean
Procedures (number) 11.00 8.00
Time (days) 16.60 25.22

Source: The World Bank - Doing Business, Latest data available.

The Competent Organisation
All necessary information is on the SEBRAE website. It is also possible to make an application for registration by Internet. It is advisable to call on a lawyer for assistance.
For Further Information
Consult Doing Business Website, to learn more about procedures to start a business in Brazil
Register of Commerce

Financial Information Directories

Dun & Bradstreet - Worldwide directory with financial information on businesses

Kompass Brazil - Business directory for Brazil


Recovery Procedures

Law 11 101 of 2005 simplified bankruptcy, recovery and repurchasing procedures in order to favor creditors and credit fluidity. The new system enables minority creditors who are too insistent to be marginalized and favors dialogue between debtor and creditor in order to perpetuate the activity of the company. The priorities in reimbursing debts in the case of bankruptcy are according to several categories: the employees (within a limit of 150 salaries minimum), then the fiscal administration, then the other creditors according to the preferential rank given to their claims.
Minimum Debt-to-Capital Ratio Triggering Liquidation
A creditor or an association of creditors can claim bankruptcy if the debtor cannot reimburse his debts at the required date, from an amount equivalent to 40 salaries minimum.
Bankruptcy Laws
LEI N o 11.101, DE 9 DE FEVEREIRO DE 2005. (Law 11.101 of 9 February 2005)
Reorganization and Rehabilitation Laws
Legal and extra-legal stabilizing procedures are always possible. In the first case, under the direction of a judge and with the agreement of some of the creditors (at least 1/3 of the claims in each category and the majority for two of them), all debts are suspended for a maximum of 6 months to leave the debtor company the time to reorganize the payment of its debts. In the second case, there is a simple renegotiation and rescheduling of the debt between the company and its creditors, but it requires the agreement of the creditors who hold at least 60% of each category of debt. The same law as for bankruptcies governs legal stabilizing.

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The Active Population in Figures

Labour Force 105,542,221107,461,08399,843,130

Source: International Labour Organization - ILOSTAT, Latest data available.

Total activity rate 70.17%70.31%70.93%
Men activity rate 80.09%79.97%80.19%
Women activity rate 60.50%60.90%61.89%

Source: International Labour Organization - ILOSTAT, Latest data available.


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Working Conditions

Opening Hours
  • Legal Weekly Duration
The legal duration is 44 hours, although the norm in Brazilian and foreign companies is 5 weekly working days of 8 hours.
  • Maximum Duration
Overtime is paid 50% more than the basic wage. The maximum number of hours per day and/or per week is 2 hours a day, with the agreement of both parties.
  • Night Hours
A maximum of seven consecutive hours is allowed in town (from 10 p.m. to 5 a.m.) and height hours in the countryside (from 9 p.m. to 5 a.m.). Hours worked over this are considered to be overtime.
Working Rest Day
Saturday and Sunday.
Paid Annual Vacation
30 days of annual vacation granted at the end of the first year in the job.
Retirement Age
The minimum retirement age is 55 for women and 60 for men in civil service. In the private sector, men have to have contributed for 35 years to the retirement scheme and women for 30 years. If the number of years of contributions is lower than these figures but over 15 years, it is also possible for men to retire at 65 and women at 60. If these conditions are not met, there is a minimum retirement pension accessible to everyone over 65.
Child Labour and Minimum Age For Employment
The minimum age for working is 16 and 14 for apprentices.
Informal Labour Market
Nearly 25% of the active population works in the informal sector, and almost as many are self-employed, 80% undeclared. In total, the informal sector represents almost half of the labor market in Brazil.

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The Cost of Labour


Minimum Wage
BRL 1,212 per month ($ 217.18 dollars) since the 1st of January 2022 (Agência Brasil).
Average Wage
Gross average monthly wage: BRL 1,921 in 2021 (FDR)
Other Forms of Pay
  • Pay For Overtime
150% of the basic wage.
A maximum of six consecutive hours is allowed. Hours worked over this are considered to be overtime.
  • Pay For Rest Days Worked
Considered to be overtime (50% more than the basic wage).
  • Pay For Night Hours
In urban areas, there is an increase of 20% within a limit of 8 hours of daily work, equivalent to 7 hours at night (a night hour lasts 52 min 30s). In rural areas the increase is 25%, but the legal limit is 8 hours per night.
  • Pay For Overtime at Night
The increase for night work is added to the increase for overtime.

Social Security Costs

The Areas Covered
Social insurance (covering old age, disability, maternity, unemployment), social assistance (for people in situations of increased vulnerability) and health.
Contributions Paid By the Employer: Employers are required to contribute 8% of an employee’s wages for the severance fund, 20% to the public pension system, and a maximum of 8.8% for other social security taxes. In some business sectors, the 20% INSS contribution has been replaced by a contribution levied on gross revenue (temporary measure until 31 December 2023) (Deloitte, 2022).
Contributions Paid By the Employee:

Employees contribute 8% to 11% to social security, depending on their salary categories (Deloitte, 2022).

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Management of Human Resources



Method of Recruitment
In spite of the cost of labor in Brazil, the job market is very dynamic especially for managers. Adverts are put in the newspapers, on specialized web-sites, and by word of mouth. For high level management, methods of recruitment are basically the same as those of European or American firms. For less qualified personnel, a simple interview is enough.
Recruitment Agencies
Brazilian and international recruitment agencies are taking a growing place on the job market.
Recruitment Websites
Recruitment website
People consulting

The Contract

Type of Contract
Legal measures govern work contracts; collective agreements and individual negotiation complete them. The formality of work contracts and constraints of dismissal are very rigid, while hiring conditions are rather flexible. The two types of contract mainly used are fixed term and open ended. A variation on the fixed term contract is a contract with no hierarchical relation for carrying out a particular task.

Breach of Contracts

  • Retirement
Workers can retire according to the terms described above.
  • Dismissals
In the case of fixed term contracts the employer can part with an employee without penalty when the contract runs out. In the case of an open ended contract or before the end of a fixed term contract, either of the parties can terminate the work contract with 8 or 30 days' notice, according to whether the worker is paid weekly or monthly. If the employer has no valid motive for dismissal, half of the wages remaining until the expiry of the fixed term contract must be paid. In all cases, the balance of remaining vacation must be paid, as well as the balance of the fund into which the company pays contributions every month for the employee, the FGTS, up to 8.5% of gross salary, increased by 40 to 50% when an employee with an open ended contract is dismissed without a valid motive. The Brazilian Labor Code is very rigid, so a serious motive is necessary to dismiss an employee, or a difficult economic situation must be proved.
  • Other Possible Methods
Direct negotiation with the employee concerned.
Labour Laws
Labor Law in Brazil
Doing Business: Brazil, to obtain a summary of labour regulations that apply to local entreprises

Dispute Settlement


Conciliation Process

Cases of Dispute
Disputes regarding working conditions, misuse of power and moral harassment, individual or collective negotiation.
  • Legal Framework
The creation of a conciliation commission ("juntas de conciliação prévia") before which any decision concerning the dispute must be taken. One of the two parties can appeal to this conciliation court whose decisions must be accepted.
  • Procedure
Law 9 985 of February 2000 promotes conciliation in disputes between companies and their employees.

Judicial Structures

  • Competent Legal Body
There are industrial tribunals in each State where disputes not settled by conciliation are heard. There are Magistrates' courts in the four macro-regions of the country and a Higher Industrial Tribunal settles the last appeal procedures.The Higher Industrial Tribunal (in Portuguese) (the Constitution of 1988, title 4, chapter 3, section 5, article 111 governs the role of the Higher Industrial Tribunal).

Social Partners

Social Dialogue and Involvement of Social Partners
Labour unions, especially in sectors such as metalworking and banking, tend to be well-organised and aggressive in defending wages and working conditions. Unions in various sectors engage in industry-wide collective bargaining negotiations mandated by federal regulation. Strikes occur periodically, particularly amongst public sector unions.

The Labour Code prohibits having too many unions for a single profession and in each region. Although the law has not created a central institution representing the unions, four groups have tried to provide this, but without legitimacy: the Unitarian Workers Group (CUT), the General Confederation of Workers (CGT) and the Força Sindical (FS). Some industrial and mining sectors have powerful unions; however, the unions are more or less absent from the rural areas where the great landowners still hold sway.

Unionisation Rate
The Ministry of Labour estimates that there are 15,000 labour unions in Brazil, but these figures are considered by some to be inexact. Labour unions account for approximately 19% of the official workforce according to the Brazilian Institute of Geography and Statistics (IBGE). Union dues are compulsory for all workers in the formal sector and are set at one working day's income per year.
Labour Unions
Unitarian Workers Group
CGT Brazil
Força Sindical

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Latest Update: June 2024