Juliano Griebeler, director of Government Affairs at Barral M Jorge, spoke with the Latin America Advisor journal, a daily publication of The Dialogue. Read below his evaluation about the Brazilian Labor Reform.
“The labor reform modernizes labor rules in Brazil that were not compatible with the modern work relationship, and that reduced Brazil’s competitiveness. It gives to the companies more options when hiring, allowing fl exible contracts and cost reduction. On the workers’ side, the reform gives to strong labor unions greater autonomy in negotiating their rights. However, workers who do not have an organized union to represent them will be more susceptible to the employer’s interests during the negotiations.
The labor reform reduces the ‘Brazil Cost’— Brazilian singularities that increase the cost associated with doing business in the country. The changes will give more control to companies over their business, reducing the economic impacts from events out of the companies control. With greater control over its expenses and hiring, companies will adapt faster to unexpected situations.
Political shifts will not affect the approved labor law, especially if the current administration is replaced by a member of its own coalition. Even the opposition will not change issues that the current administration already paid a high political cost to implement; at most, if an opposition party is able to become the ruling coalition, we might see some changes in the outsourcing law. It is important to note that the enactment of the labor law is not the end of the discussion.
Temer is expected to edit a provisional measure, softening some points seen as negative in the text approved, as agreed with Senators. Trying to demonstrate strength by approving the labor reform in a fast process, Temer extended discussions and created uncertainties on the matter. Opposition parties will surely try to change aspects of the rules approved when they are once again discussed in Congress.”