Employing in Brazil: the 14 things foreign employers check before a first CLT hire

1

How does a foreign firm hire under the CLT?

A foreign business has two routes: register its own sociedade limitada (LTDA) and set up payroll, or appoint an employer of record that becomes the legal employer under the Consolidação das Leis do Trabalho (CLT, the labour code). On the second route the employer of record signs the contract, records the admission in the digital carteira de trabalho (CTPS) through eSocial before work starts, runs payroll and pays INSS and FGTS. Recruitment, the job description and the pay level stay your decisions.

2

What will a R$ 15.000,00 salary in São Paulo cost in 2026?

About R$ 271.600,00 a year, or 1.51 times twelve monthly salaries. Annual gross pay is R$ 200.000,00, because the employee receives 12 salaries, a 13º salário of R$ 15.000,00 and a one-third bonus of R$ 5.000,00 on férias (annual leave). Employer charges of 35.8% on all of it add R$ 71.600,00.

Assumes lucro real or presumido, FPAS 515, RAT 2% with a FAP of 1.0 and no CCT extras; meal vouchers, a health plan or PLR would add to it. The EOR fee is separate: from USD 560 a month, or roughly R$ 2.901,24 using the ECB rate published on 24 September 2026.

3

What decides the first working day of a Brazilian hire?

Mostly as soon as the candidate is free. Someone leaving a job usually owes their current employer 30 days’ notice. Once the offer is accepted, the contract is signed, documents are collected and the admission goes to eSocial before the first working day. A foreign national also needs a residence authorisation for work from the Ministério da Justiça e Segurança Pública before starting, which adds a separate approval step. Setting up an LTDA first adds company registration on top.

4

Is a Brazilian LTDA or CNPJ needed before hiring?

No. Under an employer of record arrangement we are the legal employer, so no CNPJ or Junta Comercial registration is needed on your side. A company of your own, usually a sociedade limitada (LTDA), can make sense for a larger team, but foreign owners should expect extra steps such as apostilled documents, sworn translations and an accountant for ongoing bookkeeping. The government’s Mapa de Empresas puts the average opening time at about 23 hours, a figure driven mostly by domestic owners.

5

Can you pay a Brazilian worker as a PJ contractor?

You can sign a service contract with a pessoa jurídica (PJ), but the labour courts look at how the work happens. If it is personal, regular, paid and subordinate (CLT art. 3), the relationship is employment, and the business may owe back 13º salário, férias with the 1/3, FGTS with the 40% fine, notice and INSS with interest. Keeping an unregistered employee also carries a fine of R$ 3.000,00 per worker. The STF is reviewing PJ hiring under Tema 1389, with the merits undecided at 25 September 2026.

6

Which terms must a CLT contract set out?

The contract records the job, pay, hours and start date, and the admission must be entered in the digital CTPS. Most indefinite contracts open with a contrato de experiência (probation) of up to 90 days. Normal hours are 8 a day and 44 a week, with overtime capped at 2 hours a day. Any teletrabalho must be written into the contract, and a written contract in the employee’s own language is the sensible default even where the law allows a tacit one.

7

Which payroll taxes apply in 2026?

The employer pays INSS patronal of 20% with no ceiling, RAT of 1% to 3% that can be adjusted by the FAP, 5.8% to terceiros for FPAS 515 businesses and an 8% FGTS deposit. The employee pays INSS at 7.5% to 14% up to a 2026 ceiling of R$ 8.475,55, so no more than R$ 988,09 a month, plus IRRF at up to 27.5%. Since January 2026, taxable income up to R$ 5.000,00 a month owes no IRRF. Everything is reported through eSocial.

8

Where is the salário mínimo set for 2026?

R$ 1.621,00 a month nationally, which works out at R$ 7,37 an hour or R$ 54,04 a day. States may set higher regional floors, and the convenção coletiva for a sector often sets a piso salarial above both. For any hire, check the CCT that covers the employer’s activity and the place of work.

9

How many days off does the CLT give?

Férias are 30 calendar days after each 12 months of service, paid with an extra third of salary. Maternity leave is 120 days, or 180 where the employer joins Empresa Cidadã. Paternity leave is 5 days in 2026, rising to 10 days in 2027, 15 in 2028 and 20 in 2029 under Lei 15.371/2026, the last step subject to fiscal targets. Carnaval is not a public holiday for private employers unless a CCT or local law says so.

10

Who pays sick leave?

The employer pays for the first 15 days a worker is unable to work, and from day 16 the INSS pays auxílio por incapacidade temporária instead. This split comes from Lei 8.213/1991 and has been stable for years. A longer illness therefore costs the employer two weeks of pay rather than the whole absence. After a work accident, the same law generally protects the employee’s job for 12 months, so any dismissal in that period needs careful review first.

11

Where do the INSS and FGTS deposits end up?

INSS contributions fund the public social security system, which pays retirement pensions, sick pay from day 16, maternity pay and other benefits. FGTS works differently: the employer’s 8% goes each month into an account in the employee’s name, operated by Caixa Econômica Federal, with each deposit due via FGTS Digital by day 20 of the next month. The employee can draw on it after events such as a dismissal without cause, when the employer also deposits a 40% fine. The terceiros levies fund salário-educação, INCRA, SESC, SENAC and SEBRAE.

12

What does dismissing a CLT employee involve?

Dismissal without cause (sem justa causa) is allowed, but it has a price. Notice (aviso prévio) runs to 30 days, with 3 more for every full year worked and a ceiling of 90, and the employer deposits a 40% fine on all FGTS paid during the contract. Proportional 13º salário, accrued férias with the 1/3 and the salary balance are due within 10 days. Justa causa applies only on the grounds in CLT art. 482, and a mutual agreement under art. 484-A halves the notice and the fine.

13

Can staff work from home or abroad?

Yes, under the teletrabalho rules in CLT arts. 75-A to 75-F. Remote work must be written into the contract, and who supplies equipment and pays expenses must be agreed in writing. An employee hired in Brazil who later works from another country generally stays under Brazilian law unless agreed otherwise. A foreign national living in Brazil needs a residence authorisation linked to the job; the digital nomad visa covers only people without a Brazilian employment link.

14

Which tasks move from your desk to ours?

We become the legal employer and sign the CLT contract. We handle the cost sheet, the eSocial admission, monthly payroll, INSS, IRRF and FGTS payments, 13º salário instalments, férias planning, leave records and, when needed, termination figures and the final settlement. Hiring decisions, objectives and pay rises remain yours. The service is billed from USD 560 per employee per month, after a one-off set-up fee that normally applies.