international employment law firm alliance L&E Global

Brazil: Companies Take Legal Action to Prevent the Publication of the Transparency Report Related to the Gender Pay Gap

Since the enactment of Law 14,611/2023, many discussions have arisen about the obligation for companies to publish the semiannual transparency report, which will be unilaterally produced by the MTE, considering information disclosed by the companies. Given that the date for the publication is approaching, several companies are taking legal action and requesting a preliminary injunction to be released from the obligation of disclosing such transparency report on their websites and social media channels.

The main argument of the companies is that the regulation of Law 14.611/2023 (Decree 11,795/2023 and Ordinance 3,714/2023) created additional obligations such as the publication of the report on companies’ websites and social media channels, which exceeds what is provided by Law 14,611/2023 and violates the principle of legality guaranteed by the Brazilian Federal Constitution. In addition, companies argue that the data requested by the law and its regulation, plus the publication of such report may violate the Brazilian General Data Privacy Law and competition law.

Some companies were able to obtain favourable decisions, wherein the judges granted the preliminary injunction releasing them from publishing the gender pay gap report on their websites and social media channels. Final decisions confirming such injunctions, however, have still not been granted.

On the other hand, a judge has recently denied the preliminary injunction requested by the Industry Federation of the State of Minas Gerais (Federação das Indústrias do Estado de Minas Gerais) to prevent the publication of the gender pay gap report. The judge has ruled that the data required by the Decree 11,795/2023 “are pertinent to the intended purpose and are in line with the objective of reaching the constitutional duty to make wages of men and women equal.”

Key Action Points for Human Resources and In-House Counsel

  • Companies must be prepared for the publication/disclosure of the transparency report by the Ministry of Labour and the need to publish it on their websites and social media channels by 30 March 2024;
  • Companies may present disclaimers/justifications and even their own report showing the compliance with the equal pay for equal work rule along with the report of the MTE;
  • Analyze the possibility of taking legal action to try to prevent the publication of the transparency report on websites and social media channels;
  • Be prepared for possible questionings from labour authorities and even employees and stakeholders.

TozziniFreire is available to assist the companies with any clarification about the law and measures that must be taken to comply with it and to better protect the company.