Brazil Adopts Equal Pay Law

​Brazil's new Equal Pay Law was published in the Official Gazette on July 4 and took effect immediately.

Although the Brazilian Federal Constitution and the Consolidation of Labor Laws (CLT) already provided some protection for women in terms of equal pay, the new law adopts specific measures aimed at monitoring compliance with equal pay between people of different genders who perform the same job function. When there is a failure to comply, more severe sanctions have been introduced.

All companies with more than 100 employees must publish a Salary Transparency Report every six months. The report must cover the criteria set out in The General Data Protection Law (LGPD) and provide, in anonymized form, information necessary to enable a comparison and impartial evaluation of the remuneration criteria and of the proportion of men and women in leadership positions. The data provided must be accompanied by statistical data on other possible inequalities arising in relation to race, ethnicity, nationality and age.

In cases where there is a difference in remuneration due to discrimination on grounds of gender, race, ethnicity, national origin or age, the employer will face a fine of 10 times the amount of the new salary owed to the employee who has been discriminated against. The fine will be doubled if the discrimination reoccurs, without prejudice to other legal measures. The payment of the fine and/or wage differences due to the employee who suffered discrimination does not exclude the employee's right to claim compensation for moral damages.

In the event that an employer does not adopt equal pay practices, an administrative fine of up to 3 percent of the employer's payroll, limited to 100 times the monthly minimum wage, will be applicable without prejudice to other sanctions.

When there is a failure to comply with the provisions of the law, the private legal entity in question must create an action plan, which includes goals and deadlines, to mitigate this inequality and which is created in conjunction with representatives from the union and employees from the workplace.

The law also provides for:

• The establishment of salary transparency mechanisms.
• An increase in inspections.
• The creation of specific channels for reporting cases of wage discrimination.
• The promotion of workplace inclusion programs.
• The promotion of training and education of women to enter, remain and progress in the labor market, on equal terms with men.

Juliana Nunes is an attorney with DLA Piper in Sao Paulo. © 2023 DLA Piper. All rights reserved. Reposted with permission of Lexology.