Ju ly 20 , 2020

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COVID-19:

Back to Business

A Brazilian Employment Law Perspective

BRAZILIAN EMPLOYMENT LAWPRESENTERS

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Aline FidelisPartner | Brazil+55 11 96847-8749

afidelis@mayerbrown.com

Thatiane CampelloSenior Associate| Brazil+55 21 99405-6902

tcampello@mayerbrown.com

Responding to COVID-19

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A B OU T MAY E R B R OWN

Mayer Brown is a global services provider comprisingassociated legal practices that are separate entities,including Mayer Brown LLP (Illinois, USA), Mayer BrownInternational LLP (England), Mayer Brown (a Hong Kongpartnership) and Tauil & Chequer Advogados (a Brazilianlaw partnership) (collectively the “Mayer BrownPractices”) and non-legal service providers, whichprovide consultancy services (the “Mayer BrownConsultancies”). The Mayer Brown Practices and MayerBrown Consultancies are established in variousjurisdictions and may be a legal person or a partnership.Details of the individual Mayer Brown Practices andMayer Brown Consultancies can be found in the LegalNotices section of our website.

InsightsAdded Value 3

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A M E R I C A S

Brasília (T&C)CharlotteChicagoHoustonLos AngelesMexico CityNew YorkPalo AltoRio de Janeiro (T&C)San FranciscoSão Paulo (T&C)Washington DC

E U R O P E

BrusselsDüsseldorfFrankfurtLondonParis

M I D D L E E A S T

Dubai

A S I A

BangkokBeijingHanoiHo Chi Minh CityHong KongShanghaiSingaporeSingapore (MBC)Tokyo

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BrasíliaSCS Quadra 9, Bloco A, Torre B, Salas 503/504Ed. Parque Cidade CorporateBrasília - DF 70308-200

T + 55 61 3221 4310 F + 55 61 3221 4311

São PauloAv. Presidente Juscelino Kubitschek, 1.455, 6º andarSão Paulo - SP04543-011

T +55 11 2504 4210 F +55 11 2504 4211

Rio de Janeiro

Av. Oscar Niemeyer, 2.000 Aqwa Corporate, 15º andarRio de Janeiro - RJ20220-297

T +55 21 2127 4210F + 55 21 2127 4211

VitóriaAv. Nossa Senhora dos Navegantes, 451, 17º andar, Conj 1703 Vitória - ES29050-335

T +55 27 2123 0777 F + 55 27 2123 0780

Tauil & Chequer in association with Mayer Brown

Founded in 1992, Tauil & Chequer Advogados in association withMayer Brown has grown rapidly and today has over 107 lawyers inRio de Janeiro, São Paulo, Brasília and Vitória. In December 2009,Tauil & Chequer entered into an association agreement withMayer Brown, becoming “Tauil & Chequer Advogados inassociation with Mayer Brown”. The firms teamed up with thepurpose of offering their clients a unique combination of legal andbusiness knowledge nationwide, with global reach.

Tauil & Chequer has a strong and traditional presence in theenergy sector in Brazil. Tauil & Chequer advises a large number ofnational and international oil and gas companies on theirinvestments in the energy industry in Brazil and other locationswith regard to a variety of legal affairs, including mergers andacquisitions and project development, as well as tax, regulatory,labor and litigation matters.

The lawyers at Tauil & Chequer are competent in local andinternational jurisdictions, advising national and globalorganizations.

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Employment & Benefits - Brazil

Consulting

Tauil & Chequer Advogados in association with Mayer Brown has a highly specializedteam to provide legal advice in all employment and Human Resources matters, as wellas consultancy and the due diligence of labor liabilities and human resourcesprocedures.

We represent companies ranging from mid- to Fortune 100-sized companies on everystep of labor relations, from hiring to termination procedures for the purposes ofensuring compliance with labor legislation and preventing our clients from any laborexposure.

Our lawyers also advise clients on structuring and managing their labor benefits andexecutive compensation plans and assist them in strategic matters, such as StockOptions Plan, retention agreements, non-disclosure agreements, non-compete andnon-solicitation agreements, health and safety, labor accidents and specific legislationfor offshore employees.

Union Negotiation

Our practice is highly experienced in the negotiation of Collective BargainingAgreements and Conventions with Unions, collective lawsuits, strikes, negotiation ofworkdays and Profit Sharing Plans (PLR).

Litigation

We strategically represent relevant companies in labor litigation matters in Brazil,representing our clients in individual and collective labor lawsuits.

Tauil & Chequer Advogados is experienced in complex cases, involving theprevious negotiation of the lawsuits up to all steps of the defense of our clients’interest in judicial lawsuits, extrajudicial agreements and administrativeproceedings involving the Labor Public Prosecutor Office (MPT), labor authoritiesand Unions.

Immigration

We are also highly qualified to provide advice on what needs to be performed tocomply with labor and immigration laws by focusing on assistance in the processof identifying the appropriate residency authorization and visa for foreignemployees.

Our clients also benefit from our association with the global practices of MayerBrown, which enables us to offer our experience in drafting Contracts and GlobalMobility Policies to our clients in other parts of the world.

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“10Hundred"

1 Recent modifications in the legislation

2 Home Office – Workday and Policy

3 Privacy

4 Discrimination

5 Reopening the workplace

6 Oil & Gas

7 Health and Safety

8 Covid-19 – Medical Leave

9 Immigration

10 Addressing employee issues

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Main Aspects – Law No. 14,020/2020:

The main purposes of this Law is preserving employment and income, guaranteeing the continuity of work and business activities and reducing the socialimpact resulting from the consequences of the state of public calamity and public health emergency.

The Federal Government will complement employees' income through the Emergency Benefit for the Preservation of Jobs and Income ("EmergencyBenefit").

1. Recent modifications in the legislation

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Payment of the Emergency Benefit

to employees included in certain

conditions

Proportional reduction of workday and

salaries

Temporary suspension of the

employment contract

1 2 3 Employers must observe the conditions fornegotiating the reduction of workday and salariesor the temporary suspension of the employmentcontract. It may be required the negotiation upon aCollective Bargaining Agreement or through anaddendum to the employment contract accordingto employees’ salary and educational background.

Emergency Program for Maintaining Employment and Income: This program enables employers toreduce employees' workday and salary proportionately (by 25%, 50% and 70%), if certain conditionsare met:

1.Recent modifications in the legislation

29Emergency Program for Maintaining Employment and Income: This program also permits thetemporary suspension of the employment contract.

Provisional guarantee of employment during the reduction and after the re-

establishment of the workdayPreservation of the employees’

hourly wage

Main Conditions – Law no. 14,020:

• Retired employees -> if the company decides to execute an Individual Agreement with the retired employee, the Company will also be responsible for paying theamount equivalent to the Emergency Benefit that would be paid by the Brazilian Federal Government.

• Pregnant employees -> may participate in the Emergency Program for Maintaining Employment and Income, if the Law requirements are met by the Company.

• Employees with disabilities -> cannot be dismissed during the state of public emergency.

1.Recent modifications in the legislation

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Company Income in 2019Compensatory Support

to the EmployeeEmergency Benefit Individual Agreement

Collective BargainingAgreement

Up to BRL 4,8 millions

Not mandatory100% of the unemployment

insurance

Applicable to employees whoreceives up to 3 minimum wages or if

the employee hasa college degree and receives at

least twice the INSS benefit (BRL 12,202.12).

Applicable to all employees

Higher than BRL 4,8 millions

Mandatory. 30% of the employees’ wage

70% of the unemployment insurance

Applicable to employees who receives up to 2 minimum wages if the employee has a college degree and receives at least twice the INSS

benefit (BRL 12,202.12).

Applicable to all employees

1.Recent modifications in the legislation

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Main Aspects – Decree 10,422:

Decree 10,422 of July 13, 2020 regulates Law No. 14,020/2020 to extend the term of suspension of the employment contract and the proportional reduction ofworkday and salaries.

Employers may suspend the employment contract or proportionally reduce the workday and salary for a period up to 120 days.

The Decree 10,422 also establishes that the Government support through the Emergency Benefit will depend on the Brazilian Federal Government incomebudget.

Main Aspects – Ordinance 16,655:

The Ordinance 16,655 of July 14, 2020 permits rehiring employees 90 days after their formal termination without this act being considered afraud, as previously set forth by applicable legislation. However, in the rehiring, the salary of the employee may not be reduced, except uponUnion negotiation.

2. Home Office – Workday and Policy

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Remote Work (Teletrabalho)

• Employees are not submitted to a workday control, nor entitled to payment ofovertime or night work allowance (Article 62 of the Brazilian Labor Code).

• Requirements: (i) Addendum to the Employment Contract (i.e., infrastructure,work tools, health and safety matters, instructions to avoid an occupationaldisease) and (ii) Employees must sign a Responsibility Term.

• Modification to a new work regime: – Minimum period of notice of 15 days.

Home Office

• Employees are entitled to payment of overtime or night work allowance,according to applicable legislation and work conditions.

• Possibility of control of the workday, including rest and meal period, as well asProductivity of Employees.

• No Responsibility Term is required, but it is advisable the implementation of aHome Policy upon employees’ consent.

• Discussion by Brazilian Labor Courts: Work Tools and Reimbursement ofexpenses

Equipment, Security and Confidentiality

Employees must ensure the safekeeping and maintenance of all equipment involved in the work and they are responsible for ensuring the security and confidentialityof the Company's property and all data, information, files, documents, including both paper and electronic material in their possession. Therefore, the employees mustkeep absolute confidentiality about all privileged information and work-related documents.

• Workplace testing/screening: workplace testing and screening procedures shall be conducted with extreme caution inorder to safeguard employees’ data privacy and to comply with Brazil’s data protection laws. Thus, the employee shallbe aware about how the collected data will be treated and used.

• Testing Option: It may be mandatory according to employers’ core business. If it is not mandatory, companies maydecide if they will request or not the testing of employees and if so, the procedures shall be conducted carefully ensuringanonymity and healthcare professionals shall be employed in the process.

3. Privacy

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Brazil’s Data Protection Law (LGPD - Law No.

13,709/2018)

Data - Consent Compliance with the laws and regulations

Health and Safety Protection

Privacy Intimacy

LGPD comes into force on May 3, 2021 and some administrative sanctions on August 2021, but

there is a discussion about its effectiveness to be ruled by the Brazilian Government. Even so, the

Law provisions are already being used as parameters by Brazilian Courts.

• The discrimination in the workplace isstrictly forbidden in Brazil, being a majorlabor related risk to employers.

P r i n c i p l e o f n o n -d i s c r i m i n a t i o n :

M i s u s e o f d a t a a n d d i s c r i m i n a t i o n :

• The occurrence of episodes of discrimination in the workplace may result in labor lawsuitsfiled by employees or inspections by labor authorities.

L a b o r r e l a t e d r i s k s

4.Discrimination

• The improper use of health-related data during the COVID-19pandemic is a risk to the companies, for it can cause discriminatorybehaviors in the workplace.

• Employees may not be treated in a different form due to COVID-19.

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Legal Aspects – Ordinance No. 20/2020: Practical Aspects:

Take into account the BrazilianGovernment Regulations,including general and sector-specific guidance.

Undertake a COVID-19 riskassessment for the workplace,take steps to mitigate risksidentified and monitor on acontinuous basis.

Implement a phased approach toreturn to the workplace which isspecific to each location and itschallenges.

Employee engagement andcommunication is key.

5. Reopening the Workplace

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Ordinance No. 20 of June 18, 2020 of the Ministries of Economy and Health establishes measures that must beadopted in the workplace for prevention, control and mitigation of transmission risks of COVID-19. Employersmust disclose to their employees the guidelines and protocols with the necessary measures for prevention,control and mitigation of transmission risks by COVID-19.

Employers must clean and disinfect work places andcommon areas regularly during the workday.

Surgical or fabric masks used in the workplace are: (i) provided toall employees; (ii) mandatory use in shared environments or whenin contact with other employees or the public; and (iii) made inaccordance with the recommendations of the Ministry of Health.

The employer must create or revise the procedures for the use,cleaning, packaging and disposal of Personal ProtectiveEquipment (PPE), and other protective equipment used in theorganization in view of the risks generated by COVID-19.

Main Aspects:

Essential Activity: the Decree No. 10,292, enacted on March 25, 2020, as well as otherregulations in Brazil listed Oil & Gas-related activities as essential and, therefore, shall not besuspended even during the COVID-19 pandemic.

Recommendations: the Labor Public Prosecutor’s Office (MPT), in association with severalauthorities issued a Recommendation Note (Ouro Negro) which establishes several protectivemeasures to be adopted by Oil & Gas companies during COVID-19. Such measures areapplicable to operators and service providers belonging to the Oil & Gas industry and aim tosafeguard employees’ health and safety.

Adopted Measures: For compliance with the legislation into force, companies such asPetrobras have adopted a series of preventive measures, such as:

Adjustments in the rotating shifts of embarked employees. The shift will be of 7 days ofsocial distancing in a hotel paid by the company and 21-days on board X 14-days ofperiod leave.

Implementation of home office to all applicable cases.

Screening of all of the employees that will render services offshore.

6. Oil & Gas

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7. Health and Safety

Brazilian Labor Code:

Statutory obligations – Health and Safety at Work -Brazilian Labor Law and Normative Rules issued bylabor authorities.

Employers are required by Law to submit its employeesto medical examinations: (i) pre-employmentexamination; (ii) periodic; (iii) return to work (i.e., returnfrom medical leave); (iv) change of position; (v) attermination.

For each medical examination performed, the physicianwill issue the Occupational Health Certificate ("ASO").

The main purpose of these examinations and ASO is toverify if an employee is considered capable to work ornot.

Employers obligations during COVID-19:

• The employer must promote distance of its employees incommon areas.

• The employer must supply alcohol gel to its employees.

• COVID-19 its considered justified absence during the first 15days of symptoms (no deduction of salary).

• Employer is obliged to remove employees with symptoms ofCOVID-19 from work.

• Employer must create protocols to deal with confirmed orsuspected cases of COVID-19.

• Employer must cancel or avoid in-person meetings.

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General Aspects:

Period:> Employee not capable to work - 15 days – Employer

> Employee not capable to work – After 15 days – INSS

Employment Contract: Dormant

Tenure: Employees who suffer a labor accident or work-related diseasemay not be terminated for a period of 12 months after returning to work.

8. Covid-19 - Medical Leave

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Covid-19:

Law No. 13,979/2020:> 15 days of medical leave will be deemed as justified absences (no

deduction of salary).

> After 15 days, the employee will be remitted to INSS that will startpaying the social security benefit.

Supreme Federal Court (STF): According to a decision rendered by STF on April 29, 2020,the Covid-19 may be deemed as a work-related disease, if it is demonstrated the lack ofsufficient health and safety protection measures in the workplace. 18

Lawsuits: In case of lawsuits filed by employees due to Covid-19, there is a risk of claims of moral damages, material damages (i.e., reimbursement of medicalexpenses not covered by the health plan) and even life support payment to be claimed by the family, in case of death of the employee.

Burden of proof: Employer

Strict Liability: In labor lawsuits with these claims, Brazilian Labor Courts usually determine the strict liability of companies (regardless of fault or gross intent of theemployer), because companies are responsible for assuming all risks of its business, especially the ones related to health and safety at work.

Potential Labor Liabilities

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9. Immigration

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Crew members for the performance of specificfunctions on board of a vessel or platform operating injurisdictional waters.

Foreigners are also permitted to enter Brazil with avisitor visa, including a business visa, or foreigners witha temporary visa for a specified period with thefollowing purposes:

(i) research, teaching, or academic graduation;(ii) study;(iii) work;(iv) investment;(v) family reunion; or(vi) artistic or sports.

Foreigners must present, prior toboarding, a medical declarationattesting that they are notinfected with Covid-19.

Brazilian nationals.

Immigrants with definitive residence authorization (exceptfor Venezuela).

Children, spouse or parents of Brazilian nationals (exceptfor Venezuela).

Foreigners working for international organizations or withBrazilian government accreditation.

Public interest or humanitarian travel.

Foreigners holding the National Immigration Registry(except for Venezuela).

Technical landings for refueling and cargo transportation.

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Airlines must deliver the GeneralDeclaration for all internationalflights arriving to Brazil to theairport´s health authority.

Main Exceptions

Passengers transiting throughBrazil who will not leave theinternational area of the airportand will be permitted entry totheir destination country.

Location: Restriction for all countries Period: 30 days counting from June 30, 2020 Type of Restriction: All foreigners are prohibited from entry by air transportation; leaving vessels in case of waterway transportation; and entry by land crossing in

all land border countries.

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• The COVID-19 pandemic created a serious challenge to companies: to be able to return to in-person activities while providing asafe workplace for the employees.

• In non-risky activities, the employer shall be held liable if an employee has COVID-19 in the workplace due to the employer’snegligence and non-compliance with health and safety rules.

• Therefore, the employer shall properly address the issues appointed by the employees in order to avoid any kind of labor risksand to safeguard their health and safety. For instance, some of the major complaints arising from the return to in-personactivities are:

10. Addressing employees’ issues

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Individual issues are likely to focus onpotential barriers of returning to theoffice: health reasons, public transportconcerns and dependent care issues. Theadoption of measures in order to ensureemployees’ protection in the workplace ishighly important in order to reduce theirconcerns.

The analysis of individual legal rights willbe of extreme importance - vulnerablegroups, such as elderly people, pregnantemployees and those who have chronicaldiseases, will require additionalprotection by the Company.

Other areas of individual challenge willinclude data protection and health andsafety concerns. A well-structured dataprotection policy may reduce the risksand avoid any kind of controversiesinvolving discriminatory episodes anddisclosure of data.

Issues in the return to work

Data Protection concerns

Enhanced Protection

A M E R I C A S

Brasília (T&C)CharlotteChicagoHoustonLos AngelesMexico CityNew YorkPalo AltoRio de Janeiro (T&C)San FranciscoSão Paulo (T&C)Washington DC

E M E A

BrusselsDubai DüsseldorfFrankfurtLondonParis

A S I A

BangkokBeijingHanoiHo Chi Minh CityHong KongShanghaiSingaporeSingapore (MBC)Tokyo

Employment & Benefits Group

THANK YOU FOR LISTENING

Our Global Employment & Benefits group comprises approximately 100 lawyers, offering sophisticated solutions to thefull range of contentious and non-contentious labor, employment, immigration and benefits issues.

Operating in the world’s principal financial centres across the Americas, Asia, Europe and the Middle East, and with acarefully nurtured “best-in-class” network of internationally experienced law firms, we are perfectly positioned to offerlegal counsel and representation on global employment and benefits matters.

For the latest legal commentary and thought leadership on the COVID-19 pandemic, please visit Mayer Brown’sdedicated portal, ‘Responding to COVID-19’ where you will have access to an array of complimentary materials andinformation.

About Mayer Brown

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Disclaimer

• These materials are provided by Mayer Brown and reflectinformation as of the date of presentation.

• The contents are intended to provide a general guide tothe subject matter only and should not be treated as asubstitute for specific advice concerning individualsituations.

• You may not copy or modify the materials or use themfor any purpose without our express prior writtenpermission.

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