Employment in Brazil at a glance
Capital
Brasília
Language
Portuguese
Remote workers
7.3M
Currency
R$ Brazilian Real (BRL)
Working hours
44 hours per week
Public holidays
10 days per year
Minimum monthly salary
BRL 1,621
Tax year
Jan 1 - Dec 31
Date format
DD/MM/YYYY
Misclassification penalties
Fines of BRL 400,000 per employee, plus retroactive social security contribution, FGTS, and vacation with an interest of 75% to 225%.
Fun fact
In Brazil, voting is mandatory; hence, the police cannot arrest or detain any voter five days before the election and two days after the election.
Taxes in Brazil
Employer contributions
-
Employment tax: 29% - 33.5%
-
Social insurance: 8.5% - 12.5%
-
Pension: 8%
-
Work accident insurance: 1%-3%
Employee contributions
-
Employee tax: 7.5% - 41.5%
-
Social security: 7.5% - 14%
Income tax
Gross income: Up to BRL 2,428.80
Tax rate: 0%
Gross income: BRL 2,428.81 – BRL 2,826.65
Tax rate: 7.5%
Gross income: BRL 2,826.66 – BRL 3,751.05
Tax rate: 15%
Gross income: BRL 3,751.06 – BRL 4,664.68
Tax rate: 22.5%
Gross income: Over BRL 4,664.68
Tax rate: 27.5%
Looking for a quick cost estimate?
Use our calculator to understand what are all the employment costs you have to consider in Brazil.
Employer of Record in Brazil
What is an EOR?
An Employer of Record (EOR) is the legal employer of a worker in Brazil. As such, the Employer of Record has extensive knowledge and local expertise and takes care of all Brazil compliance aspects of employment, including payroll management, taxes, statutory employee benefits, employment contracts, severance pay and more.
EOR responsibilities
-
Ensuring their employment is compliant with local laws
-
Processing local payroll
-
Filing employment related taxes and returns
-
Issuing payslips to the employee
-
Distributing salary payments
How it works
-
Company
Maintains a direct relationship with the employee, allocates them work tasks, and manages their performance.
-
Boundless
Takes care of payroll, taxes, and employee benefits, ensuring the employee and the company are compliant with all legal regulations.
-
Employee
The third party to the employment agreement, the employee, fulfils all of their obligations as a worker for the company.
Cultural compatibility
Brazil has good cultural compatibility with U.S. companies, scoring “very good” on Gartner’s index. It’s also listed as one of the top 30 outsourcing locations.
In Brazil, professional culture leans towards relationship-building, with personal interactions often preceding business discussions. This approach can be different from the US or UK, where the line between personal and professional life is more strictly defined. Unlike the US or UK, where punctuality is strictly observed, Brazilians have a more relaxed view of time.
Brazilian businesses operate hierarchically, with decision-making centralized at the top. This contrasts with more flat organizational structures seen in some US and UK companies. Companies in Brazil frequently organize celebrations for various occasions, enhancing workplace camaraderie, like happy hours, holiday parties, celebrations/gifts for achieving goals, costume day, team travels and so on.
Benefits in Brazil
Statutory benefits in Brazil
-
13th month salary
-
Transportation voucher
-
FGTS
-
Daycare assistance
-
Holiday bonus
Common non-mandatory benefits in Brazil
-
Meal voucher
-
Private pension
-
Extended paternity leave
-
Fuel allowance
-
Life insurance
-
Family forming
-
Support for transgender employees
-
Private health insurance
-
Extended maternity leave
-
Flexible work
-
Annual bonus
Rights & protections in Brazil
Written employment contract
Payslip
Holiday entitlement
Health & safety
Protection from discrimination
Unemployment funds
Severance fund
13th month salary
Transportation voucher
Leave in Brazil
Paid annual leave
30 days + public holidays
Sick leave
Determined by the doctor. Brazilian employers cover the first 15 days of paid sick leave. From the 16th day onward, Social Security (INSS) pays for the leave
Paid maternity leave
120 days with a possibility of additional 60 days through Empresa Cidadã
Paid paternity leave
5 days with a possibility of additional 20 days through Empresa Cidadã
Bereavement leave
2 days
Employment conditions in Brazil
Probation
The probation period is 45 days, but can be extended to 90 days.
Notice periods
Notice period is 30 days, with 3 additional days for every one year of tenure, capped at 90 days.
Payments in Brazil
Payment frequency
There are two different pay frequencies, monthly or bimonthly, that companies adopt in Brazil, depending solely on the company and the CBA applicable.
Payday
If paid once a month, employees are usually paid on the 5th day of the following month. If paid twice a month, employees are usually paid on the 5th and 20th of the month.
Tech ecosystem in Brazil
International companies with offices in Brazil:
Google, Amazon, Microsoft, Facebook, Netflix, Uber, Airbnb, Apple, Oracle, IBM, LinkedIn, Twitter, Adobe, Intel, Samsung, Cisco Systems, Dell, HP, Spotify, Salesforce, Slack, TikTok (ByteDance), Zoom, eBay, PayPal, Mastercard, Visa, Stripe, Nvidia, SAP, Siemens, Autodesk, VMware, Zoom, Accenture, Infosys, Cognizant, Workday, ServiceNow, NTT Data.
Local unicorns
Industry: Fintech
Company: Nubank, PagSeguro, StoneCo, Ebanx
Industry: e-Commerce
Company: iFood, Loggi, MercadoLibre
Industry: Healthtech
Company: Dr. Consulta
Industry: Edtech
Company: Arco Educação
Industry: Real Estate
Company: QuintoAndar
Incubators and accelerators
- Cubo Itaú: A leading entrepreneurial hub in Latin America located in São Paulo, Cubo Itaú aims to foster innovation and technological entrepreneurship.
- Startup Farm: Known as one of Brazil’s most active accelerators, Startup Farm has a strong track record of supporting successful startups.
- Sebrae: This agency provides a range of services including business acceleration, support, and training to SMEs and startups.
- Porto Digital: Based in Recife, Porto Digital is a major tech park and innovation hub that includes an incubation program.
- InovAtiva Brasil: A nationwide acceleration program that offers training, mentoring, and connections to startups.
Venture capital firms
- Monashees: One of the leading venture capital firms in Brazil, Monashees has invested in several successful Brazilian startups like Nubank and Rappi.
- Kaszek Ventures: Kaszek is a leading Latin American VC firm that has made numerous successful investments in Brazilian startups.
- Redpoint eVentures: The Brazilian arm of Redpoint Ventures, this VC firm invests in early-stage tech companies in Brazil.
- Valor Capital Group: This cross-border venture firm focuses on US-Brazil opportunities and has backed numerous Brazilian startups.
- Canary: Canary is a São Paulo-based VC firm that invests in early-stage startups across Brazil.
End of employment in Brazil
In Brazil, employment can be terminated without cause at any time, provided the notice period is respected (or paid in lieu) and the employee receives their severance pay. Employee termination must be written, signed, and dated.
Employees who lost employment with or without cause must receive their salary and any outstanding payments on their last day of employment.
Employees terminated without cause are entitled to severance pay, which consists of the funds employers put aside monthly for employees on their Time of Service Guaranteed Fund (FGTS). Additionally, employers must pay 40% of the balance of the employees’ FGTS as compensation.
The Brazilian labor law recognises some reasons that lead to termination with cause. However, employers must have a legitimate and recognised reason and must prove the misconduct.
Infrastructure
Internet connectivity: Brazil has one of the highest internet penetration rates in Latin America. Around 71% of the Brazilian population were internet users, a number that is projected to grow.
Mobile penetration: Brazil has a high level of mobile phone penetration, with more active mobile connections than inhabitants. As of 2021, there were more than 234 million mobile connections in Brazil, equivalent to a penetration rate of approximately 110%.
Payment systems: Brazil’s international payment systems include PayPal, Apple Pay, Google Pay, and major credit and debit cards. For international transfers, Brazilians often prefer PayPal, Wise (formerly TransferWise), or local fintech Remessa Online. As of 2021, Bitcoin led the crypto scene, followed by Ethereum, with exchanges such as Mercado Bitcoin, BitcoinTrade, and Foxbit in operation.
FAQs
Companies hiring in Brazil typically have four options. You can run payroll from your HQ for short-term arrangements, engage contractors for project-based work, set up a local entity to hire directly, or partner with an Employer of Record. Each option carries different compliance, cost, and administrative effort. An EOR allows compliant Brazilian employment without setting up a local entity.
Contractors work well when the relationship is project-based and the person serves multiple clients. If an individual gives their full and undivided attention to your company in Brazil, employment is the right structure under Brazilian law, covering entitlements like paid annual leave, sick leave, and social security contributions. For project-based contractor engagements, Boundless’s Agent of Record (AOR) service handles classification, contracts, and payments compliantly in Brazil.
HR compliance in Brazil means your policies and procedures respect all applicable Brazilian employment laws and regulations. When you hire in Brazil, this matters both to safeguard employee rights and to reduce employer risk. Compliance covers labour law, sick leave, annual leave (30 days), minimum wage (BRL 1,621/month), tax credits, and a 44-hour working week. Following these is fundamental for running the business well.
Employing in Brazil involves statutory contributions on top of the gross salary you are offering. Brazilian employers contribute to social insurance, pension, and work accident insurance, along with a 13th-month salary, holiday bonus, and FGTS. To view the exact percentages and amounts for the salary you plan to offer, you can use our handy calculator tool.
An Employer of Record is the legal employer of the individual in Brazil for government, tax, and employment purposes. It provides a locally compliant contract, runs payroll, files employment taxes, and manages statutory benefits such as 120 days of maternity leave, the 13th-month salary, and FGTS. You remain responsible for sourcing workers, managing day-to-day work, and funding payroll each cycle.
Boundless partners with employment lawyers and advisers in each country we operate in, including Brazil. They ensure employment contracts and onboarding documents comply with the local jurisdiction, including how collective bargaining agreements apply. We hold detailed discussions on specific norms such as payroll, social protection, data protection, notice periods, and work-from-home regulations. When a sensitive issue arises, our internal team engages the relevant firm promptly.
Both employers and employees in Brazil pay social security contributions. Employers contribute approximately 29-33.5%, including pension, social insurance, work accident insurance, and FGTS. Employees contribute 7.5-14% in social security plus progressive income tax of 0-27.5%. To get a clear overview of both employee and employer taxes, use the salary breakdown calculator.
Can’t find what you’re after?
Or maybe the country you’re looking into isn’t available yet?
Employment cost calculator
Understand the employment costs you have to consider in any country
Global employment made gloriously uneventful
Talk to us and discover Boundless possibilities
Book a personalised discovery and get your questions answered by our experts.
