It has become customary to refer to workers who perform operational, technical or manual activities as “blue-collar” employees. They are also called “workers” or “manual labourers” and work in industry, construction, services, health, agriculture, etc. They are plumbers, electricians, nursing technicians, mechanics, craftsmen, bricklayers, petrol station attendants, painters, bakers and many others. Their work requires manual skills or technical training.

In turn, “white-collar” employees are workers in administrative and managerial areas, which require intellectual activities and usually require higher education. They are bosses, managers, superintendents, lawyers, accountants, economists, etc.

Over time, as a spin-off from the above, other categories have been created, such as “pink-collar” for traditionally female activities (manicurists, beauticians); “green-collar” for activities related to the environment and ecology (forest engineers); “gold-collar” (highly qualified and highly paid professionals); “black-collar” for clandestine or illegal activities (gambling, prostitution); “new-collar” for technology and start-up sector personnel (developers, UX designers).

Regardless of the “colour of the collar”, Brazilian labour laws apply equally to all categories, respecting the natural specificities of each one.

As for their duration, individual employment contracts can be concluded for an indefinite or fixed term. As the name suggests, indefinite contracts have no defined duration and can last for decades, following the principle of continuity of employment. This is the standard contract under Brazilian labour law. An exception to the rule is the fixed-term employment contract, which can only be entered into if there is transience in the employee’s service or the employer’s activity, with a maximum term of two years, and in cases of probationary periods, which cannot exceed 90 days. Employment contracts can be tacit or express, verbal or written.

Although not required by law, case law has established the need for fixed-term contracts to be formalised in writing. For their validity and effectiveness, employment contracts must have a capable agent, a lawful, possible, determined or determinable object, and a form prescribed or not prohibited by law. It will be necessary to include:

• the identification of the parties;
• the position and function;
• the workplace;
• the working hours and schedule;
• the salary and benefits;
• the start date (and end date, if determined);
• the conditions of termination; and
• specific clauses (such as confidentiality, teleworking, possibility of transfer, agreement to travel, time bank, on-call duty, reimbursement of losses, etc).

The maximum permitted working hours are eight hours per day and 44 hours per week. Any hours worked in excess of this will be considered overtime. Flexibility is possible. The normal daily working hours may be increased by up to two hours, subject to individual or collective agreement. These hours may be compensated or paid with a minimum increase of 50%. Exceptionally, a working day of 12 consecutive hours may be established, followed by 36 uninterrupted hours of rest.

The minimum wage is a constitutionally guaranteed right for Brazilian workers, with a uniform value throughout the national territory, and is intended to meet basic vital needs such as housing, food, education, health, leisure, clothing, hygiene, transport and social security. Workers who receive the minimum wage are entitled to receive a 13th-month salary and any bonuses and premiums paid by their employer. The minimum wage is set by the Federal Government and adjusted annually by Presidential Decree, based on the variation in the National Consumer Price Index (INPC), with a variable real increase, in accordance with the New Fiscal Framework and the provisions of Law No 15,077 of 27 December 2024.

Holiday Leave

Holidays are due after 12 months of work, without loss of pay and with a maximum duration of 30 days, or less, depending on the number of absences during the accrual period. Remuneration during the holiday period will be one third higher than normal. It is permitted to split the holiday into up to three periods, provided that one of them is not less than fifteen consecutive days and the others are not less than five days. If desired, the employee may convert one third of the holiday period into a cash bonus. The holiday period will be chosen by the employer.

Maternity Leave

There is mandatory maternity leave, normally 120 days, paid by the official social security system. This right is extended to cases of adoption, in which case the leave period will vary from 120 to 30 days, depending on the age of the adopted child. In cases of work accidents and incapacitating illnesses, leave is also mandatory. Leave of up to 15 days is paid by the employer, and any period exceeding this limit is paid by the official social security system. With regard to children with disabilities, Brazilian labour legislation does not stipulate compulsory leave. This matter has been the subject of individual and collective negotiations, and there are precedents of mothers obtaining judicial authorisation to reduce their working hours in order to care for disabled children. Parents have the right to take one day off work per year to accompany their child up to six years of age to a medical appointment (regardless of whether or not the child has a disability).

Confidentiality

The duty to maintain confidentiality regarding strategic information relating to the employer is implicit in the employment contract, and its breach by the employee may give rise to dismissal for just cause, which does not prevent the contract from being supplemented with other confidentiality clauses. The stipulation of confidentiality in the contract cannot violate public policy rules or impose disproportionate obligations. Permanent, excessively long or indefinite clauses are also not accepted, as they may be considered null and void for violating the principle of legal certainty. There must be a specific and reasonable time limit, compatible with the protected interest. Clauses that prevent communication with supervisory bodies, reporting of irregularities or compliance with legal obligations that involve the disclosure of information will also be ineffective. With regard to non-defamation clauses, it is the natural obligation of the employee to refrain from acts that damage the honour or good reputation of their employer or superior, under penalty of justified dismissal.

Employee’s Liability

As for liability, the employee’s legal and contractual obligations are:

• obedience and subordination;
• diligence and zeal;
• loyalty and fidelity;
• secrecy and confidentiality; and
• respect for health and safety standards at work.

Damages caused to the employer shall be compensated by the employee, if there is a contractual provision to that effect, or if the damage was caused intentionally. If the form of compensation chosen by the parties is a monthly salary deduction, this shall be limited to 70% of the salary received, in order to ensure a minimum salary in cash for the worker.

Although there is no express provision in the legislation, non-compete clauses are considered valid based on the principle of contractual freedom (Article 444 of the Labour Code – “Consolidation of Labour Laws” , or CLT). It is important to note that, under the terms of the sole paragraph of that article, it is a requirement that the employee not be underprivileged, ie, the employee must have a university degree and receive a monthly salary equal to or greater than twice the maximum limit of the benefits of the General Social Security System.

To be valid, the clause must observe reasonable time and territorial limitations, with case law admitting up to two years as reasonable and territorial delimitation in locations where the employer actually operates. It is also important to clarify the specific object (ie, which activities are actually covered), and, finally, that there be financial compensation. Compensation to the employee must observe maintenance of the standard of living, ie, the proportion of remuneration.

It is therefore important that the clause includes rights and duties for both parties, not just the employee. Violation of the clause should be challenged in the Labour Court.

As set out in 2.1 Non-Competes, although there is no express provision in the legislation, non-solicitation clauses are considered valid based on the principle of contractual freedom (Article 444 and sole paragraph of the CLT). Therefore, in Brazil, it is permissible to include non-solicitation clauses, provided that the parameters are reasonable and do not absolutely impede the free exercise of the profession, freedom of work or competition. It is preferable that the clause be included at the beginning of the employment relationship, observing temporal and territorial limits, and a clear commercial justification is recommended.

Unfair or excessively broad clauses may be considered abusive and annulled by the courts.

The General Data Protection Law (LGPD), Law No 13,709/2018, applies in the context of the employment relationship, from the processing of a candidate’s data to the termination of the employee.

It is the employer’s responsibility, with the support of the compliance and legal departments, to observe the LGPD’s principles and adapt the company’s procedures as necessary to protect employee data, where applicable. This means safeguarding sensitive information and always allowing the employee to access their data; they can also request its portability or deletion, if applicable.

The hiring of foreign employees must comply with Brazilian law in its entirety. Foreigners may not receive a salary higher than that of Brazilians performing the same function, and the company must first dismiss the foreign worker rather than terminate the contract with the Brazilian worker in the same position. The CLT provides in Chapter II, Section I, Article 352 et seq for a rule requiring a minimum of two thirds of Brazilian workers on the staff, which is therefore a limitation on hiring.

Foreign workers must have the appropriate visa for the job, and, if the job is technical, their diploma must be validated via the Carolina Bori Platform.

As mentioned, foreign workers need a specific visa to work in Brazil. Currently, the Ministry of Justice and Public Security has the General Co-ordination of Labour Immigration (CGIL). The relevant legislation is Migration Law 13,445 of 24 May 2017, and Decree 9,199 of 20 November 2017.

Labour immigrants must register with the Immigration Management and Control System, fill out the form and submit the relevant documentation. Once working in Brazil, workers are subject to all relevant legislation and have all the rights of Brazilian workers.

Remote work is authorised by law and regulated by Articles 75-A to 75-F of the CLT. Telework is the provision of services outside the employer’s premises, whether predominantly or not, using information and communication technologies.

Attending the employer’s premises, even on a regular basis, to perform specific activities that require the employee’s presence at the establishment does not disqualify the remote work regime. Employees subject to the telework or remote work regime may provide services by the hour or by production or task. In the case of services provided under a teleworking or remote work regime by production or task, there is no obligation to control working hours.

The teleworking or remote work regime is not to be confused with or equated to the occupation of telemarketing or call centre operator (situations that have their own legal regulation, with shorter working hours).

The time spent using the necessary technological equipment and infrastructure, as well as software, digital tools or internet applications used for teleworking, outside the employee’s normal working hours does not constitute on-call time or standby duty, unless provided for in an individual agreement or in a collective labour agreement or convention.

The adoption of teleworking or remote working arrangements is permitted for interns and apprentices.

Employees working under teleworking arrangements are subject to the provisions of local legislation and collective labour agreements relating to the territorial base of the employee’s place of work. The employment contract of an employee hired in Brazil who chooses to telework outside the national territory is subject to Brazilian law, except for the provisions of Law No 7,064 of 6 December 1982, unless otherwise stipulated between the parties.

An individual agreement may provide for the hours and means of communication between the employee and employer, provided that legal rest periods are ensured. The provision of services in the form of teleworking must be expressly stated in the individual employment contract.

A change between on-site and teleworking may be made provided that there is mutual agreement between the parties, recorded in a contract amendment. A change from teleworking to on-site work may be made at the employer’s discretion, with a minimum transition period of 15 days, with a corresponding record in a contract amendment. The employer shall not be liable for expenses resulting from the return to on-site work if the employee chooses to telework or work remotely outside the location specified in the contract, unless otherwise agreed between the parties. 

The provisions relating to responsibility for the acquisition, maintenance or supply of the technological equipment and infrastructure necessary and appropriate for the performance of remote work, as well as the reimbursement of expenses incurred by the employee, shall be set out in a written contract. The utilities necessary for the performance of the work are not included in the employee’s remuneration.

The employer shall instruct employees, expressly and conspicuously, on the precautions to be taken to prevent illness and accidents at work. The employee shall sign a statement of responsibility committing to follow the instructions provided by the employer.

Employers shall give priority to employees with disabilities and employees with children or children under legal guardianship up to four years of age when allocating positions for activities that can be performed through telework or remote work.

The only provision in the CLT that comes close to the concept of sabbatical leave is the suspension of the employment contract for a period of two to five months for the employee to participate in a professional training course or programme offered by the employer, with a duration equivalent to the contractual suspension, subject to provision in a collective bargaining agreement or collective labour agreement and formal consent of the employee.

There is no legal provision for leave outside this scenario.

The absence of legal provision, however, does not prevent sabbaticals from being provided for in collective instruments (collective bargaining agreement or collective labour agreement).

It is also possible to negotiate them individually. However, for individual negotiations, there will be greater legal certainty only for those employees who have higher education and remuneration above twice the ceiling of the RGPS (general social security regime, currently BRL16,314.82), since the CLT ensures that only employees who meet these two requirements can negotiate individually with the employer and that such negotiation will prevail in the event of a conflict with the law or with the collective instrument of the category.

In recent years, one of the most relevant and discussed innovations in the labour law area has been the growing use of artificial intelligence (AI) and algorithms in managing labour relations. Technological advancements have allowed companies across various sectors, especially those linked to the so-called “platform economy”, to begin employing automated systems to monitor, evaluate and even hire workers. This phenomenon has sparked a series of legal reflections on the protection of workers’ rights, the definition of employment relationships, and the ethical limits of automation in labour relations.

In the Brazilian context, the discussion has gained momentum mainly due to the popularisation of transportation and delivery apps, such as Uber, iFood and Rappi. On these platforms, labour management is carried out almost entirely through algorithms, which define routes, evaluate performance, assign tasks, and can even “disconnect” workers for poor performance. This scenario raises questions about algorithmic subordination, a concept used to describe workers’ dependence on the guidelines and commands established by automated systems, often equating it to the traditional legal subordination established by the Consolidation of Labour Laws (CLT).

Legal debates focus on issues such as the transparency of algorithmic criteria, the possibility of reviewing automated decisions, and the obligation of companies to provide clear information about how these tools operate. Several experts advocate the need for specific regulations to ensure that the use of AI respects fundamental rights, such as human dignity, the protection of personal data, and the right to disconnect.

The Brazilian Judiciary has already faced cases in which workers seek recognition of their employment relationship due to the subordination exerted by the algorithm. Recent decisions show that the Courts’ understanding remains heterogeneous, varying depending on the analysis of the specific case and the evidence presented. However, there is a growing recognition that technology, when used to direct and control the provision of services, can indeed constitute typical elements of the employment relationship, challenging traditional concepts of labour law.

In conclusion, the discussion about the use of artificial intelligence in labour relations represents one of the greatest contemporary challenges for labour law. Addressing this issue requires not only updated legislation but also a proactive stance from legal practitioners, who must seek balanced solutions to ensure worker protection without hindering technological advancement and business innovation. The future of work will inevitably be increasingly digital and automated, and it is up to the law to adapt to this new reality in an ethical and socially responsible manner.

A trade union serves to defend the rights and interests of workers, whether in relation to working conditions, wages, benefits or labour rights. They act as representatives of workers in negotiations with employers and government agencies, seeking better working conditions and preventing setbacks in the rights that have been achieved. In addition, trade unions have broad legal representation, meaning they can represent the entire category or just a fraction of it in court. Trade unions are also responsible for entering into collective agreements (trade union x company) or collective conventions (business trade union x category trade union) in order to regulate labour relations, as authorised by the Constitution.

Employee Representative Committees (CRE) are bodies created by the Labour Reform (Law No 13,467/2017) to promote worker participation in the company and strengthen dialogue between employees and employers. These committees are elected in companies with more than 200 employees and their main objective is to improve the relationship between the company and its employees, seeking solutions to conflicts and monitoring compliance with labour laws.

In companies with more than 200 employees, the election of a committee to represent them is guaranteed, with the aim of promoting direct understanding with employers. The committee will be composed of the following:

• in companies with more than 200 and up to 3,000 employees, three members;
• in companies with more than 3,000 and up to 5,000 employees, five members; and
• in companies with more than 5,000 employees, seven members.

If the company has employees in several states of the Federation and in the Federal District, the election of a committee of employee representatives per state or in the Federal District shall be ensured, in the same manner as described above.

The committee of employee representatives shall have the following duties:

• represent employees before company management;
• improve the relationship between the company and its employees based on the principles of good faith and mutual respect;
• promote dialogue and understanding in the workplace in order to prevent conflicts;
• seek solutions to conflicts arising from the employment relationship quickly and effectively, aiming at the effective application of legal and contractual rules;
• ensure fair and impartial treatment of employees, preventing any form of discrimination based on gender, age, religion, political opinion or union activity;
• forward specific claims from employees within its scope of representation;
• monitor compliance with labour and social security laws, collective bargaining agreements and collective labour agreements;
• the decisions of the employee representative committee shall always be collegial, with a simple majority;
• the committee shall organise its activities independently;
• the election shall be called at least 30 days in advance of the end of the previous term of office, by means of a public notice that shall be posted in the company, with wide publicity, for the registration of candidates;
• an electoral committee shall be formed, composed of five employees who are not candidates, to organise and monitor the electoral process, with no interference from the company or the trade union;
• company employees may stand as candidates, except those with fixed-term employment contracts, suspended contracts or who are in their notice period, even if compensated;
• the candidates with the most votes in a secret ballot will be elected as members of the employee representative committee, with proxy voting prohibited;
• if there are not enough candidates, the employee representative committee may be formed with fewer members;
• the term of office of the members of the employee representative committee shall be one year;
• a member who has served as an employee representative on the committee may not be a candidate for the two subsequent terms;
• the term of office as a member of the employee representative committee does not imply suspension or interruption of the employment contract, and the employee must remain in the exercise of their duties; and
• from the registration of the candidacy until one year after the end of the term of office, members of the employee representative committee may not be dismissed arbitrarily, meaning without disciplinary, technical, economic or financial grounds.

In simple terms, both collective agreements and collective bargaining agreements are collective bargaining instruments that establish rules and working conditions, but with different levels of coverage. A collective bargaining agreement is an agreement between employers’ and employees’ unions, covering an entire professional category in a given region. A collective agreement, on the other hand, is an agreement between one or more workers’ unions and one or more specific companies. The Federal Supreme Court ruled, in a binding opinion, that “collective agreements and conventions are constitutional when, considering the negotiated sectoral adequacy, they agree on limitations or waivers of labour rights, regardless of the specified explanation of compensatory advantages, provided that absolutely inalienable rights are respected”.

The CLT establishes, in Article 611-B, the limitations on collective bargaining. This list is not exhaustive, meaning that it can be interpreted broadly by the courts, but it provides an indication of the most obvious prohibitions. The following rights may not be suppressed or reduced in collective bargaining agreements or collective labour agreements:

• professional identification standards, including entries in the Work and Social Security Card;
• unemployment insurance, in the event of involuntary unemployment;
• value of monthly deposits and severance pay from the Guarantee Fund for Length of Service (FGTS);
• minimum wage;
• nominal value of the thirteenth salary;
• remuneration for night work higher than that of daytime;
• protection of wages in accordance with the law, with intentional withholding constituting a crime;
• family allowance;
• paid weekly rest;
• remuneration for overtime work at least 50% higher than normal;
• number of days of holiday due to the employee;
• paid annual leave with at least one third more than the normal wage;
• maternity leave with a minimum duration of 120 days;
• paternity leave under the terms established by law;
• protection of the female labour market through specific incentives, in accordance with the law;
• notice proportional to length of service, with a minimum of 30 days, in accordance with the law;
• health, hygiene and safety standards at work provided for by law or by regulatory standards of the Ministry of Labour;
• additional remuneration for arduous, unhealthy or dangerous activities;
• retirement;
• insurance against accidents at work, paid for by the employer;
• action regarding credits resulting from labour relations, with a limitation period of five years for urban and rural workers, up to a limit of two years after the termination of the employment contract;
• prohibition of any discrimination regarding salary and admission criteria for workers with disabilities;
• prohibition of night work, dangerous or unhealthy work for minors under 18 years of age and any work for minors under 16 years of age, except as apprentices, from the age of 14;
• legal protection measures for children and adolescents;
• equal rights between workers with permanent employment and casual workers;
• freedom of professional or trade union association for workers, including the right not to suffer, without their express and prior consent, any charges or salary deductions established in collective bargaining agreements or collective labour agreements;
• the right to strike, with workers deciding on the opportunity to exercise it and on the interests they should defend through it;
• legal definition of essential services or activities and legal provisions on meeting the urgent needs of the community in the event of a strike; and
• taxes and other third-party credits.

Rules on working hours and breaks are not considered occupational health, hygiene and safety standards.

No reason is required for termination. Dismissal is an employer’s right. Only dismissal for just cause requires a reason, as explained in 7.3 Dismissal for (Serious) Cause.

Collective dismissals after 2017 may be carried out by express provision of law (Law No 13,467 of 2017).

Before 2017, the jurisprudence of the Superior Labour Court required prior collective bargaining with the union representing the category, given the negative economic impacts of dismissal.

Advance notice is mandatory for indefinite contracts, except in cases of dismissal for just cause. In the event of resignation by the employee, advance notice is 30 days, which may be worked or compensated. In the event of dismissal by the employer, the notice period is a minimum of 30 days, plus three days for each year worked at the company if applicable, up to a maximum of 90 days.

During the notice period worked, the employee may have their working hours reduced by two hours per day or choose to take the last seven days of the period off, without loss of pay. The notice period, whether worked or compensated, counts as length of service for all legal purposes (holidays, 13th-month salary, etc).

Dismissal for just cause is the termination of an employment contract by the employer due to serious misconduct by the employee, as provided for in the Consolidated Labour Laws (CLT).

In dismissal for just cause, the employee will only be entitled to receive the balance of their salary and accrued holiday pay plus one third, and will not be entitled to prior notice, the 40% penalty on the FGTS, withdrawal of the FGTS, proportional holiday pay plus one third, and will not be able to apply for unemployment insurance.

There are no procedures to be followed. However, it is necessary to respect immediacy (the punishment must be adopted immediately after the discovery of the irregular act); proportionality (the misconduct must be serious enough to justify the most severe punishment provided for by law); and there can be no double punishment (ie, a misconduct that has already been punished with a warning or suspension cannot justify dismissal for just cause).

The CLT provides for the following conduct as grounds for dismissal for just cause:

• act of impropriety;
• misconduct or malpractice;
• habitual negotiation on one’s own behalf or on behalf of others without the employer’s permission, and when it constitutes an act of competition with the company for which the employee works, or is detrimental to the service;
• criminal conviction of the employee, res judicata, if there has been no suspension of the sentence;
• negligence in the performance of their duties;
• habitual drunkenness or drunkenness on duty;
• breach of company confidentiality;
• act of indiscipline or insubordination;
• abandonment of employment;
• act harmful to the honour or good reputation of any person committed in the course of service, or physical offences under the same conditions, except in cases of self-defence or defence of others;
• acts harmful to the honour or good reputation of or physical offences committed against the employer and superiors, except in cases of self-defence or defence of others;
• constant gambling; and
• loss of the qualification or requirements established by law for the exercise of the profession, as a result of the employee’s wilful misconduct.

Termination by mutual agreement, or by agreement between the parties, is a form of termination of the employment contract where the employee and employer agree to terminate the employment relationship, based on Article 484-A of the CLT, included by the Labour Reform. In this modality, the employee receives half of the indemnified notice period and is entitled to withdraw 80% of the FGTS, but is not entitled to unemployment insurance.

Agreement Between the Parties

The employee and employer agree to terminate the employment contract.

Severance pay

The employee receives:

• salary balance;
• proportional holiday pay plus one third;
• proportional 13th-month salary;
• half of the severance pay (if applicable);
• half of the FGTS penalty (20% instead of 40%);
• right to FGTS – the employee can withdraw up to 80% of the FGTS balance; and
• no right to unemployment insurance – the employee is not entitled to receive unemployment insurance in this modality.

No category of workers is protected from dismissal. However, there are specific cases of provisional stability. Provisional stability prevents the employer from terminating the employment contract without just cause during the period defined by law for each specific situation. This means that, in these cases, the employee can only be dismissed for serious reasons such as serious misconduct or force majeure. This may be provided for by law or in a collective labour agreement.

The most notable cases in the legislation are as follows.

• Pregnant women – Pregnant women have stability from the confirmation of pregnancy until five months after giving birth.
• Accident victims – Workers who suffer an accident at work have job security for 12 months after being discharged from hospital and returning to work.
• CIPA members – Members of the Internal Accident Prevention Commission (CIPA) have job security from the moment they register their candidacy until one year after the end of their term of office.
• Union leaders – Union and co-operative leaders also have job security from the time of their candidacy until one year after the end of their term.
• Employee representatives – Employees elected as representatives in companies with more than 200 employees may also have job security.

Dismissals can be carried out without just cause and for just cause.

Dismissal without just cause is a right of the employer and does not depend on any justification. As a rule, therefore, there is nothing to contest.

Dismissal for just cause is one that, as a rule, is challenged in court. The grounds for questioning are:

• the alleged conduct is not described in the law as authorising just cause;
• even if the conduct is authorised by law, it was not serious enough to justify dismissal (ie, the employer should have warned or suspended the employee); and
• the duty of immediacy was not complied with, or there was double punishment.

The consequences of a successful claim are:

• the reversal of just cause with an order to pay prior notice;
• a 40% fine on the FGTS;
• authorisation to withdraw the FGTS;
• payment of proportional holiday pay plus one third; and
• payment of unemployment insurance.

Discrimination in the workplace is any practice that excludes, limits or hinders someone’s access to or continued employment based on personal characteristics rather than professional qualifications or experience. This practice can take many forms, such as the following.

• Direct discrimination – When a person is treated differently because of a personal characteristic.
• Indirect discrimination – When an apparently neutral rule or practice disproportionately affects a specific group.
• Structural discrimination – When discrimination is internalised in society and institutions.

Law No 9,029/95 prohibits discriminatory practices in access to or maintenance of employment on grounds such as sex, origin, race, colour, marital status, family situation or age.

Termination of employment due to discriminatory acts, in addition to the right to compensation for moral damages, entitles the employee to choose between the following:

• reinstatement with full compensation for the entire period of absence, through payment of the remuneration due, adjusted for inflation and plus legal interest; and
• double the remuneration for the period of absence, adjusted for inflation and plus legal interest.

The procedural rules applied to electronic proceedings are exactly the same as those applicable to paper-based judicial proceedings. Virtual hearings are permitted, which are recorded and whose main events are reduced to writing in a document attached to the proceedings.

The Labour Court is the branch of the judiciary that deals with matters relating to labour and labour relations. Class actions are possible, under the terms of specific legislation. As a rule, lawsuits are filed in the Labour Court by trade unions, workers’ associations or the Labour Public Prosecutor’s Office of Labour. Representation by unions is broad and unrestricted, as it derives from the authorisation of the Constitution. Representation by an association is limited to its members and the association’s corporate purpose, and legal action can only be brought by an association that has been in existence for more than one year. Representation by the Labour Public Prosecutor’s Office of Labour is broad and unrestricted, provided that there are diffuse or homogeneous individual rights in dispute.

Arbitration is only possible on an individual basis for employees who receive remuneration exceeding twice the maximum limit established for Social Security benefits and to settle disputes relating to available property rights.

A prevailing party can be awarded attorney’s fees or other costs provided they are not eligible for legal aid. However, currently, the Superior Labour Court determines that legal aid benefits are granted based solely on the employee’s declaration that they are unable to cover the costs of the proceedings without jeopardising their livelihood.