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Brazil’s Controversial Intermittent Labor Contracts

Posted on the 07 September 2018 by Angelicolaw @AngelicoLaw
Brazil’s Controversial Intermittent Labor Contracts

Brazil's labor market has been a bit rocky for the past few years. But in March 2017, the unemployment rate spiked at 13.7 percent (as compared to 6.2 percent in December of 2013).

Many blame the high unemployment rate on the ongoing corruption investigations that have landed business leaders and company executives in jail on charges of bribery and money laundering. For example, Petrobras, which has been at the center of the investigations, has a significant impact on the Brazilian economy.

In 2016, journalist Kenneth Rapoza told Forbes Magazine, "Petrobras is another huge factor because it contributes so much to the economy. Movies, cultural events, and environmental programs all count on Petrobras for tens of millions of dollars in public funding in order to stay afloat. If Petrobras does not renew some of those programs, that too has ramifications in the job market."

New laws passed in 2017 allowing for "intermittent" employment contracts have also played a part in the labor numbers. Rather than hiring part-time or full-time employees, companies are hiring short-term workers. This allows employers to contract workers at times when they need their services; it also allows employees to at least find temporary employment. But it does nothing in terms of job security. Between April and June of this year, 6 percent of all jobs created were on an intermittent contract basis.

The majority of these short-term contracts are focused on low-skill jobs, such as retail, janitorial work and security guards. However, there are some higher-skilled sectors using these contracts as well. In the second quarter, 10 percent of intermittent contract job openings were for more skilled professions like nursing, education and engineering.

While some support intermittent labor contracts by arguing that they can help create jobs and give seasonal workers valid work contracts, others say that the contracts do little to fix the country's job security problems. Though unemployment has decreased in 2018, rates are still high. In July, the unemployment rate in Brazil was 12.3 percent.


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