fernando barbosa calvet vice president of sindeprestem

Fernando Barbosa CalvetVice President of Sindeprestem

Strategies developed to achieve an appropriate Regulation for the Temporary Work and Outsourcing

In Brazil, the Companies (Employment Agencies) that make up our industry operate in two distinct sectors:

TEMPORARY WORK – Temporary Workers for effective personnel replacement and seasonal production increases. An already regulated activity since 1974. Maximum Permanence Period of Temporary Worker: 90 days.

OUTSOURCING – Workers to perform specialized tasks not linked to the client end-activity. Non-regulated activity. Worker Maximum Permanence Period: Indeterminate.

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Strategic communication and persuasion actions for the temporary employment law and outsourcing

regulation updating in Brazil

• Media (Cases, Articles, News, Advertising)

• Events (Seminars, Conventions, Lectures)

• Public Relations (Parliamentary Relations with the Government, Companies and Workers Professional Associations, Opinion Leaders)

• Marketing (Direct Mail and E-mail Marketing to Stockholders mailing)

• Endomarketing (Magazine, Electronic Publications, Newsletter, Website)

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The Temporary Work and Outsourcing Market numbers in Brazil

The National Federation (FENASERHTT) was created in 2004, comprising 5 State Unions (São Paulo, Santa Catarina, Minas Gerais, Espírito Santo and Bahia) as founding members. Four new State Unions (Paraná, Rio de Janeiro, Rio Grande do Sul and Amazonas) are in the setting process and will join the National Federation.

The National Federation has a Code of Conduct and employs about 30 professionals in their permanent Staff.

It is a member of CNS - Services National Confederation and has a budget of US$ 2,500,000.00 for the financial year 2013.

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The Temporary Work and Outsourcing Market Size in Brazil

Number of Companies:

• Temporary Work: 1,700 Companies

• Outsourcing: 32,000 Companies

• Number of internal Workers in the Companies (Staff): 250,000

• Number of Temporary Workers: 810,000

• Number of Outsourced Workers: 1,564,000

• Sales Revenue (2012) Temporary Work US$ 10,000,000,000.00 / Outsourcing US$ 22,000,000,000.00

• Market Share: 72% 4

Growth of Temporary Work and Outsourcing sector over the

past two years

Growth Index 2010/2011 – 3.00 %

Growth Index 2011/2012 – 2.00 %

Projection for 2013:

• Temporary Work – Less 4%

• Outsourcing – Over 2.5%

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Challenges faced in terms of Regulation in the Segments (I)

Legal recognition of the Triangle Relation

• Temporary Work – Regulated through specific Law.

• Outsourcing – Standardized through legal instructions/opinions established by the Government. Without specific regulations.

Licensing System

• Temporary Work – Authorization for operation provided by the Ministry of Labor and Employment.

• Outsourcing – Does not exist. The Service Company expertise level is considered.

Main Local Regulations

• Temporary Work - National Law which regulates supply conditions, compensation, benefits and labor obligations.

• Outsourcing – Ordinance of the Federal Government which establishes which sectors/type of specialized services can be provided. 6

Challenges faced in terms of Regulation in the Segments (II)

Main Demands

• Compensation and Benefits compatible to the Client Company staff• Minimum Share Capital• Supervision

Justifying Reasons

• Replacement of client effective staff• Extraordinary increase of services• Specialization (valid only for Outsourcing)

Restrictions

• Union Centrals of Workers/Trade Unions• Workers Collective Labor Agreements with restrictive clauses• Tendentious Labor Justice and Work Supervision (pro-workers)

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What needs to be changed/approved in terms of regulation in the sector

Temporary Work

• Insertion of Youth in the 1st Employment Situation in the justifying reason• Insertion of workers with more than 40 years in the justifying reason• Authorization for the Temporary Work in the agricultural sector• Extension of the permanence period (from 90 to 180 days)

Outsourcing

• End of distinction between end-activity and means- activity for the provision of services• Sectorial Specialization Certification for the Services Companies• Minimum Capital requirement to operate on the market• Expansion of workers’ rights in relation to the Client staff8

Political Priorities of the Brazilian Federation

Public Relations• Government (Ministry of Labor, National Congress, Labor Courts)• Workers (Unions, Federations)• Clients (Business Unions, Company Associations and Federations)• Opinion Leaders

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Actions• Media – valorization campaigns of Temporary Work and Outsourcing, emphasizing the benefits for workers in terms of employability and the contributions to the Companies and Government.• Events – sectorial actions (industry, commerce, banks, services) putting the use of services in the competitive strategies of the contracting Organizations.

The Sectors Success Perspectives in Brazil

• Brazil is a member of BRICS, an emerging country with growth perspectives in the short and medium term.

• The workforce in Brazil (formal) is of about 50 million, and the services sector already represents 60% of GDP.

• 2 Global Events in the next 3 years that will generate a positive impact in our sectors – World Cup (2014) and Olympic Games (2016).

• The legal changes in progress to modernize the laws that regulate our activities, if approved, will provide a significant share increase.

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