Brazil: New Brazilian Law on equal pay for equal work and gender equality
Authors: Gabriela Lima and Mariana Fiorotto
Law 14,611 was enacted on 4 July 2023, amending the provision of the Brazilian Labour Code (CLT) that establishes equal pay for equal work, and introducing measures to ensure wage equality between male and female employees.
The language newly added to the CLT states that the right to wage differences resulting from discrimination based on gender, race, ethnicity, origin or age does not prevent the employee from seeking compensation from moral damages. It also added an administrative fine of ten times the new salary owed to the employee that was subject to discrimination, in the event of inspection by the Ministry of Labour. The fine doubles in case of recurrence.
Law 14,611 includes the following measures to promote wage equality and fair remuneration criteria between men and women:
- Creation of mechanisms for salary transparency and remuneration criteria;
- Strengthened inspection against discrimination of wage and remuneration criteria between women and men;
- Creation of specific channels for reporting wage discrimination;
- Promotion and implementation of diversity and inclusion programs in the workplace, including training for managers, leaders, and employees on gender equality in the labour market, with assessment of results; and
- Promotion of training and education programs for women to enter, remain, and progress in the labour market on equal terms with men.
Furthermore, in compliance with the General Data Protection Law (LGPD), private companies with 100 or more employees must publish semi-annual transparency reports on wage and remuneration criteria. Failure to comply with this requirement may lead to an administrative fine of up to 3% of the company’s payroll, capped at 100 minimum wages.
If discrimination is identified through the examination of the transparency reports, the company is required to present a plan to address and mitigate inequalities, including goals and deadlines, with the participation of labour unions and employee representatives.
Key Action Points for Human Resources and In-house Counsel
- Companies should take all necessary measures to ensure compliance with equality rules.
- Companies with 100 or more employees should seek legal assistance to prepare transparency reports on wage and remuneration criteria, ensuring compliance with labour and LGPD regulations.