Labour & Employment trends in Brazil: 3 areas to watch in 2026

The labour landscape in Brazil is shifting as we move through 2026. Data from the Labour Courts indicates a notable uptick in filings, with 2.3 million cases reported in 2025 alone. This represents an 8.47 percent increase over previous figures. Several drivers contribute to this trend, including high turnover in the services sector and the adoption of new technologies by plaintiffs to initiate claims more easily.

Workplace policy is a primary focal point as the October 2026 elections approach. One significant area of change involves working time regulations. Proposals currently sit before the Senate to transition the nation toward a 40-hour work week, moving away from the standard 44-hour model. This shift mirrors similar legislative movements in other Latin American countries, aimed at standardizing a 5-day work week.

Psychosocial health also occupies a central role in current regulatory updates. Since May, health and safety requirements mandate the inclusion of psychosocial risks within mandatory Risk Management Programmes. Companies must now account for factors like burnout and workload management. Failure to address these areas exposes organizations to potential fines and class action litigation, particularly regarding moral harassment and workplace conflict.

Finally, the status of independent contractors remains under rigorous examination. The practice known as pejotização involves engaging individuals through personal service companies. While common, this structure faces heavy scrutiny from the courts. The Supreme Federal Court is expected to rule on Case 1389 within the next year, which will provide necessary clarity on when these relationships constitute genuine independent contracting versus disguised employment. Organizations that depend on contractor-based models should prepare for potential reclassification risks and increased compliance demands as the judicial outlook stabilizes.