A Study on Workers' Rights in Brazilian Indirect Forms of Employment: With Focus on So-called 'Outsourcing' Law

Abstract

Over the last decades, Capitalism has transformed under the aegis of flexible accumulation by disrupting the Fordist and Toyotist pattern of pro-duction and generating a flexible way of working. In terms of Labor Law, the inevitable effects of flexibility on the labor relationship caused the emergence of indirect forms of employment, such as part time jobs, temporary workers, outsourcing, and subcontracting. Once explained as a strategic plan to survive the fierce competition of the new globalized world, enterprises opt to out-source labor so that they can reduce costs, amplify productivity, and offer a lower price than their competitors. In Brazil, indirect forms of employment are ruled by the Superior Labor Court's Precedent No. 331, which outlawed the practice of so-called outsourc-ing through establishing that the outsourcing of core activities is unlawful. This ruling, which has prevailed for more than two decades, has played the important role of objectively distinguishing between core and non-core activi-ties in order to define the legitimacy of the outsourcing. Therefore, the ques-tion of the existence of subordination is not primarily analyzed to define the legality of the outsourcing. When workers are outside the scope of employment or when they are indirectly used by a third company that is not their employer, it places them in a position of precarious labor relationships, weakened union representation, lack of social security, and insufficient protection for industrial accident. Be-cause indirect forms of employment cause a perverse degradation of worker's rights, it became necessary to strengthen workers' protection

however, Bra-zilian legislators have opted for more flexibility. The recently approved regu-lations, especially Law No. 13,429/17 and Labor Reform no. 13,467/17, broadens the scope of outsourceable activities. With that, the objective and material differentiation of core and noncore services falls as recent regulations authorize any and all activities, including core business-related activities. This study analyzes the principal regulations related to indirect forms of employment in Brazil, especially those services provided on a continuous ba-sis. Even with the recent legislation authorizing all activities, the present work focuses on limiting the practice of outsourcing by interpreting the law through the constitutional principles of human dignity, the value of work and the social function of enterprise. Not limited to that, this study proposes the criterion of humanizing the practice of outsourcing through the application of isonomy. Hence, all outsourced workers shall be guaranteed equal salary, benefits, and working conditions. Further, as the Brazilian Constitution limits the freedom of association, the collective agreement applying to regular employees shall be equally extended to outsourced workers, as both provide labor for the same company in the same workplace.