An attack on reason

Image_Elyeser Szturm

By Magda Barros Biavaschi* and Bárbara Vallejos Vazquez**

Measures for work in the context of the pandemic constitute an attack against reason

  1. Introduction

Luiz Gonzaga Belluzzo, questioned about the Provisional Measure, MP 927, said it was a real “attack on human reason”[I], to the extent that, contrary to the trend of other countries facing the Covid-19 pandemic, it depresses labor income and suppresses rights, with a strong impact on the demand for goods and services, warning that, if appropriate measures are not taken, the effects will be deleterious not only for the health of citizens, but for the very economy that its defenders say they want to materialize.

These are times of great insecurities. The expansion of the COVID-19 pandemic, the “Coronacrisis[ii]”, highlighted the fragility of global economic arrangements in times of “financialized” capitalism, revealing its disruptive potential. In the case of Brazil, it found a labor market with resilient structural problems that the so-called labor “reform”, in force since November 2017, tried to intensify. Based on the idea of ​​the individual and direct meeting of the wills of the buyers and sellers of the workforce as the prevailing space of normative production, this “reform” substantially affected the public system of labor protection.[iii] A system that, in this country of late capitalism[iv], not without much tension and real difficulties, was systematically constituted from 1930 onwards, in the midst of the industrialization process[v], consolidated in 1943 by the Consolidation of Labor Laws, CLT[vi], and, with comings and goings, expanded by the 1988 Constitution which, based on the principles of human dignity and the social value of work, amalgamation of the social and economic order, raised workers' rights to the condition of fundamental social rights, seeking to constitute the Social State.

It is based on this scenario and based, above all, on studies developed by the WG Mundos do Trabalho: Reformas, from the Center for Trade Union Studies and Labor Economy, CESIT/Unicamp[vii], that this article analyzes MP 927 and others, effective from the moment they are presented to Parliament, such as MP 936[viii], as well as MP 905 which, although revoked by MP 955, requires reflection, especially in view of Bill 1282/2020, approved but not yet sanctioned.

Faced with this reality, debates on the economic effects of the “Coronacrisis” deepen, whose dramatic consequences for the labor market are already being felt, especially in the commerce and services sectors, hitting informal, uberized workers harder , precarious, “exclusive autonomous”, pejotized, “entrepreneurs of themselves”, as a rule disguised employees[ix], which increased from 2015 and, more quickly, after the labor “reform”, whose fallacy of the promises of its defenders the PNAD-C data and academic research demonstrate.[X]

In Brazil, despite the difficulties in adopting effective public measures to combat the health crisis and its impacts on the economy, they are essential for the fundamental right to life of citizens to materialize and to preserve the health of the economy itself. However, those already proposed by the government do not effectively cover the unprotected majorities, nor the formalized and, contrary to the initiatives of other countries, reproduce that logic that founded the labor “reform” by allowing, via individual employment contract, be it, for example: reduced working hours with reduced wages; contracts suspended; replaced the supposed guarantee of employment by compensation of 50% of the salary due until the end of the stability period, deepening inequalities and reducing labor income, without articulating market processes.

  1. Government measures for the labor market during the pandemic.

As expressed in the aforementioned Technical Note from the Mundos do Trabalho WG, in the face of the pandemic, countries with governments of different stripes, conservative or not, adopted measures to guarantee income and employment as an immediate response to the health crisis and as a means of guaranteeing isolation to, thus , prevent the spread of the disease and preserve the demand for consumption as a way of activating the economy[xi].

The European Union has suspended budgetary discipline. In France, the government announced a package worth around 45 billion euros to ensure salary levels, help small businesses, and set up solidarity funds for self-employed workers. It also announced a “partial unemployment” plan, with the suspension of the employment contract upon compensatory payment by the State, ensuring professional training. The Netherlands announced a package guaranteeing 90% of wages for three months to workers at companies with a minimum loss of 20% of their revenues, in return for a job guarantee. In England, among other measures to stimulate demand, the government announced the maintenance of 80% of wages between March and June. Portugal, in addition to protecting affected companies, authorized layoffs simplified, with a guarantee of 2/3 of the remuneration, most of which is covered by Social Security. In the US, direct funds were sent to American families, increased access to unemployment insurance and relief measures for companies, totaling around 2,2 trillion dollars. That is, on the international scene, what is perceived is the abandonment of liberal policies.[xii]

In Brazil, with the deepening of the public debate on the insecurity to which informal and formal workers are exposed, including the unemployed, the government's economic team, with notorious slowness, comings and goings, announced some proposals, insufficient and, as underlined , contrary to other countries, including: exemptions; reduction of working hours with salary reduction, according to individual adjustment; transferring the worker to telework, as defined in the individual contract, including the infrastructure to be provided; reduction of deadlines for granting individual and collective vacations; intensification of the bank of hours; individual agreements prevailing over the law and collective instruments; R$ 200,00 voucher for informal workers.

On March 16, the government, stating that it would inject 147,3 billion reais into the economy, announced measures that, reaffirming the liberal bias, sought to re-discuss the Federative Pact, making the minimum budgets for education and health more flexible and creating triggers that, when activated, they would prohibit entities from opting for readjustments to civil servants, tax exemptions, etc. Returning to the bill that deals with the privatization of Eletrobrás, he offered the so-called “Mansueto Plan” for discussion, in reality a package of financial aid to states and municipalities, with, as counterparts, privatizations and flexibility of benefits for public servants, announcing, including the possible end of stability. Of these amounts, R$ 83,4 billion would be directed to workers and the vulnerable population, via the transfer of PIS/PASEP to the FGTS, as an incentive for new withdrawals, anticipation of the 13th of INSS retirees and pensioners and salary bonus, reduction of interest and increase in terms for payroll loans and increase in Bolsa Família beneficiaries. Also, R$ 59,4 billion would be exemptions related to the postponement of payment to the FGTS, Simples Nacional and contributions to the S System for three months, in addition to credit measures for micro and small companies and simplification of credit contracting and renegotiations. In addition to other aspects, and tax waivers or anticipated expenditures, there is no injection of “new money” into the economy [xiii]

With the worsening of the health crisis, some of the proposals announced were forwarded. One of them is Law nº 13.892/2020, enacted on April 03, 2020, with three vetoes[xiv]. Despite being insufficient, especially for the needs of the most vulnerable, the government has shown unsustainable difficulties in putting it into effect. The original proposal was to reach informal and individual micro-entrepreneurs, MEI, with aid of R$ 200,00. Faced with a strong social demand and from the Trade Union Centers, the opposition deputies managed to raise this amount to R$600,00, including the right for female heads of household to the amount of R$1.200, expanding access to the benefit to around 45 million euros. Brazilians. Before its sanction, the Senate expanded the scope of emergency aid, including family farmers, truck drivers, day laborers, waiters, recyclable pickers, manicurists, street vendors, artists, fishermen and taxi drivers. It is the Bill, PL 873/2020, approved by Parliament and submitted for presidential sanction, whose potential is to increase the reach of beneficiaries by up to 8,4 million, according to the Ministry of Economy.[xv]

On March 20, 2020, the government forwarded MP 927 which, incorporating most of the announced measures and in line with a document from the National Confederation of Industry, CNI, Industry proposals to mitigate the effects of the crisis[xvi], deepens the discretionary power of employers by attributing prevalence to individual contracts, including collective work agreements or conventions, removing unions as workers' interlocutors. In addition: it expands the possibilities of using telework, leaving the employer with the determinations of this use; authorizes the bank of hours, individually or collectively, with compensation in up to eighteen months; allows the employer to anticipate vacations (without ensuring the anticipation of the additional) and grant collective vacations, with communication to the employee up to 48 hours in advance; releases employers from requirements regarding health and safety standards at work and does not recognize illness at work as an occupational disease, unless the causal link is proven. These last provisions, object of Direct Action of Unconstitutionality, ADI 6344, are cautiously suspended by the Federal Supreme Court, STF, as will be seen.

This MP was the target of well-founded criticism, with notes of repudiation from the Union Centers and entities representing the world of work, directed, above all but not only, to its article 18 which allowed the suspension of the contract for four months regardless of the payment of wages. This article was revoked by MP No. 928/2020. However, the other provisions were maintained, as well as the logic of the direct meeting between sellers and buyers of the workforce who, individually, could define the rules that will govern the contracts, thus radicalizing the labor “reform”. And, based on this assumption, the MP allows measures such as home office, bank of hours, collective vacations, to be adopted without the participation of unions and without the counterpart of the employment guarantee.

The Sustainability Network proposed a Direct Action of Unconstitutionality, ADI 6344, against this MP, distributed to the rapporteur, Minister Marco Aurélio Mello. The injunction was rejected, the decision was submitted to the Plenary of the STF, which, in a precautionary manner, by majority, granted the precautionary measure regarding articles 29 and 31. The judgment on the merits of the ADI is not ruled. In view of this decision, the following provisions of MP 927/2020 are cautiously suspended:

Art. 29. Cases of contamination by the coronavirus (Covid-19) will not be considered occupational, except upon proof of the causal link.

Art. 31. During the period of one hundred and eighty days, counted from the date of entry into force of this Provisional Measure, the Labor Tax Auditors of the Ministry of Economy will act in a guiding manner, except for the following irregularities:
I – lack of employee registration, based on complaints;
II – situations of serious and imminent risk, only for irregularities immediately related to the configuration of the situation;
III – the occurrence of a fatal work-related accident determined by means of a tax accident analysis procedure, only for irregularities immediately related to the causes of the accident; It is
IV – work in conditions analogous to those of slavery or child labor.

MP 936/2020, the Emergency Program for the Maintenance of Employment and Income, is aimed at formal workers, with the government committing to contribute part of the salaries of employees. Among other aspects, this MP introduces the possibility of reducing working hours with a proportional salary reduction for up to 90 days, in percentages ranging from 25%, 50% to 70%, with payment, by the government, of a benefit calculated with reference to the value of the unemployment insurance (on the average of the last three values) and with specific provisions for individual agreements and for those formulated with union participation, excluding this participation for those earning up to three minimum wages and those with more than two social security ceilings[xvii]. It also authorizes suspension of the employment contract for a certain period, also by individual agreement or union participation, depending on salary values, and the period of up to 60 days may be divided into two of 30 days. In both modalities, the government pays the benefit calculated on the amount of the unemployment insurance, limited to 70% for those who receive the "compensatory aid" from the company, in fact, at the discretion of the employer, in value depending on the formalized agreement, as will be seen . Also, it introduces a supposed job guarantee, replaceable by dismissal without just cause, upon compensation of 50% of the wages that would be due until the end of the “stable” period.

In fact, it establishes wage squeeze to alleviate the crisis. In addition to the unconstitutionalities pointed out by jurists and labor magistrates[xviii], this MP is also based on the logic of the prevalence of individual adjustments that structure the labor “reform”, placing workers in a condition of great fragility and “fear”[xx]. Furthermore, it reaches the institute of collective bargaining by excluding the participation of the union for workers with wages below three national minimum wages, or above twice the maximum of Social Security benefits[xx]. Therefore, the great mass of the working class.

The period for preserving the employment relationship as a condition for joining the “program” is also insufficient. The crisis should last longer after the pandemic is over, when demand for consumption will be at very low levels - the wage squeeze will contribute to this happening -, which may lead to subsequent mass layoffs. In addition, the job guarantee that its heralds claim to ensure is fallacious, as it authorizes dismissals upon payment of compensation corresponding to 50% of wages due until the end of the period of supposed stability[xxx]. In other words, as stated in the Technical Note of GT Mundos do Trabalho, what the MP does is allow the employer to make the management of the workforce more flexible without guaranteeing employment and income to workers and without minimizing the effects of the pandemic on health, labor relations work and the economy as a whole.

The time between joining the “program” and receiving the benefit is worrying, and could further damage the demand for consumption, which is essential for boosting the economy. Furthermore, it brings excessively bureaucratic requirements, and it is up to the employer, within 10 days, counting from the conclusion of the agreement (whether reduction of working hours and salary or suspension of work), to inform the Ministry of Economy, and the first installment will be paid in 30 days from that celebration and, even so, conditioned to the information provided by the employer within the deadline. These are barriers and constraints that, in addition to raising doubts of interpretation regarding, for example, the sum or not of deadlines, may encourage dismissals, instead of preventing them. On the other hand, the "compensatory aid" provided for in article 9, cumulative with the emergency benefit, is an option attributed to the employer who, by liberality, may grant it to whoever he wishes, without objective criteria, with a high discriminatory potential endorsed by the individual contract . In addition, given its indemnity nature, it will not be computed for calculating vacation, 13th salary, FGTS and social security and tax contribution payments, and may be excluded from the company's net income for social contribution and income tax purposes, that is, in against the constitution of public funds that allow the realization of the social rights included in article 6 of the Federal Constitution of 1988.

It is important to point out that, in addition to the measures to combat the pandemic, Brazilian society was faced with the government's attempt, taking advantage of the scenario of electronic voting, to resume the agenda of liberalizing reforms prior to the crisis. This is the case of the so-called MP for the Verde Amarela Employment Card, MP 905/2019, which, in mid-April and about to lose effectiveness, went back through the process. Its substitute text was even approved by the Chamber of Deputies on April 15, 2020. With a highly flexible content of labor rights and responsible, if approved, for the creation of two categories of workers, the most and the least protected, it was based on the erroneous premise that the removal of the “rigidity” of the legislation and the consequent reduction in labor costs would increase the general levels of employment.

The strong pressure for it to be rejected by the Senate or for it to lapse, taxed, on the one hand, to the well-founded criticisms of social movements, entities representing the world of work and the Union Centers that, cohesively, pressed for rejection and, on the other, to the pandemic moment in which it was appreciated, due to the short time for discussion in the Senate and the difficulties of approval by the senators, caused it to be revoked by MP 955 on the last day of the term, April 20, 20. some of its aspects, partly recovered in a bill, PL, already approved and awaiting presidential sanction, as will be seen. This MP 905, in addition to strongly affecting public labor institutions in their constitutional attributions, such as the Labor Court and inspection systems, even assuring the validity of individual agreements formalized in notaries, even if they reduce rights, included, among others, measures such as: payroll exemption, social security contribution, education salary and social contribution to the S System, Sebrae and Incra; reduction of FGTS payment from 8% to 2% and of the additional incident on dismissals without just cause from 40% to 20%. Aimed at workers between the ages of 18 and 29 entering the formal job market, its target audience was later expanded to include workers aged over 55.

According to the Ministry of Economy, the exemptions would reduce the cost of hiring by up to 34%, supposedly generating 1,8 million new jobs. That is, the same promises that led to the approval of the labor “reform” in 2017, which, moreover, promised the creation of 6 million new formal jobs, which did not materialize. On the contrary, as the PNAD-C data show and the streets of the big cities are wide open, inequalities, unemployment, precariousness have deepened. This MP brought 188 amendments to the CLT, including the flexibilization of work on Sundays and holidays, in addition to amendments to 22 laws and decrees dealing with Profit Sharing, rural work, microcredit, and the deregulation of ten professional categories[xxiii].

Despite its repeal, the ideals that supported it continue to be strengthened. There is a risk of re-editing its content, in a dispersed form, in other measures or bills. This argument is illustrated by the recent approval of PL 1282-A, which is awaiting presidential approval. Having as its central theme the creation of a line of credit aimed at small-sized companies, via the National Support Program for Micro-enterprises and Small-sized Companies, PRONAMPE, this law, which has not yet been sanctioned, inserted chapter VI in its text: From stimulus to microcredit, that legitimizes the outsourcing and fourth-partying in core activities of financial institutions[xxiii], to be carried out by credit agents, workers in banking correspondents, in simple credit companies and in cooperatives. Still, despite the similarity of the activities carried out, it ensures that it is not possible to control the hours of these workers, nor to equate their activities to banking with regard to labor and social security rights, addressing, here, also and directly, the Labor Court. It is important to point out that studies[xxv] show to be relevant both the number of successful labor lawsuits, in which workers in banking correspondents intend to have the employment relationship recognized directly with the Bank or the rights of bank employees paid, as well as others based on frauds to article 224 of the CLT, which guarantees bankers to work 30 hours a week.

It turns out that certain changes that MP 905/2020 introduced were inserted in this PL 1282-A, whose processing was swift, taking advantage of the pandemic emergencies and the necessary help for micro and small companies. In addition, with inclusions of topics that are unrelated to the main intention and that offer nothing to face the public calamity. The question that arises is how, after all, will the inclusion in the law of non-recognition of rights arising from carrying out banking activities, by outsourced and third-party workers, contribute to combating the pandemic? Hence, it can be inferred that, although during the Covid-19 crisis, state intervention appears as an almost unison clamor, especially in aspects of fiscal and monetary policy and aid to states and municipalities, when the theme is the protection of work and security this clamor silences or even appears contrary in the voice of Ministers, some of the STF, of deputies from the base of the government and in certain means of communication, touching on the return of the liberal credo[xxiv].

What can be seen, when looking at the world of work, is that the measures proposed by the government to face the problems aggravated by the pandemic follow those premises that underpin the labor “reform” and that, in addition to being against the grain of those adopted in other countries, are proven to be ineffective in fulfilling the duty/power of the State to meet the needs of the working population, exacerbating social inequalities and not contributing to the realization of the right to life and health, nor to the economic crisis being faced . They have in common misunderstandings and misdiagnoses, both with regard to the health crisis and the economic crisis that will deepen if the appropriate measures are not taken. On the other hand, as for those already approved, the notorious implementation difficulties are showing the absence or even failure of the State to comply with its duty/power to offer suitable conditions for the realization of the right to life.

  1. Final considerations

The measures proposed by the Brazilian government are insufficient to face the urgent needs of the Covid-19 pandemic, whose crisis it causes will be the smaller the more actions to protect life and encourage the income of workers and, above all, the most vulnerable, are taken. The exponential increase in contagion and deaths that, every day, Brazilian data show more has, in itself, extremely high humanitarian and economic costs.

For the health of citizens and the economy, necessary solutions are isolation and prevention, on the one hand, and, on the other, the coordinated planning of actions by the State, with guaranteed employment and income for workers, injection of liquidity into the economy, guarantee of income flows and the offer of accessible credit to small producers, micro and small entrepreneurs, with effective measures to protect those who work in essential activities to face the pandemic, the precarious in general, informal, “autonomous”, “entrepreneurs of themselves” , domestic workers and their families, including the trade and service sectors and industrial production.

The emphatic action of the State, via public spending and active fiscal and monetary policy, is essential to obtain greater predictability, confidence and, above all, to activate the demand for consumption. It is from this understanding that the text discusses the proposals of the Brazilian government aimed at work, seeking, from the dynamics of the economy and in dialogue with the right to life and health that article 6 of the 1988 Constitution guarantees, to bring elements that contribute to the debate on the importance of universal public policies, able to implement the constitutional principles of human dignity and the social value of work and the realization of the rights to life and health that article 6 of the aforementioned 1988 Constitution elects as social fundamental.

And it is just because such measures do not effectively ensure employment, depress labor income and suppress rights, with an impact on the demand for goods and services and whose effects could be deleterious for the very economy that its defenders say they want to materialize, which rescues itself Belluzzo's saying when questioned about MP 927: a real “attack on human reason”. In fact, what is at issue is changing the role of the State so that individuals and institutions do not succumb to “the assault of satanic mills”, in Polanyi's classic expression.

*Magda Barros Biavaschi She is a retired judge at TRT4 and post-doctorate in Social Economics at Work

**Bárbara Vallejos Vazquez is a sociologist and professor at FESP/SP

Article originally published on the website Major Card.

[i] Tutaméia, March 23, 2020. In this link.

[ii] Term used in Conjuncture Bulletin nº9, from the Conjuncture Center at UNICAMP, CECON.

[iii] See “Labor Reform Dossier”, Labor Reform WG, CESIT/Unicamp, Sep.2017. In this link.

[iv] CARDOSO DE MELLO, Joao Manuel. Late capitalism. 1st ed. São Paulo: Brasiliense, 1982.

[v] See BIAVASCHI, Magda Barros. Labor law in Brazil – 1930-1942. São Paulo, LTr, 2007.

[vi] COLLOR, Lindolfo. Origins of Brazilian labor legislation. Porto Alegre: Paulo de Couto e Silva Foundation, 1990.

[vii] Technical note “Employment, work and income to guarantee the right to life”, WG Worlds of Work: Reforms, Cesit/Unicamp, April/2020. Available at this link.

[viii] These MPs are about to be voted on by the Brazilian Parliament.

[ix] See: FILGUEIRAS, Vitor Araújo; CAVALCANTE, Savio Machado. What has changed: a new farewell to the working class?. Rev. bras. Ci. Soc. [online]. 2020, vol.35, n.102. Available at this link. Epub Mar 02, 2020. ISSN 0102-6909.

[X] Refer to: KREIN, José Dari; GIMENEZ, Denis Maracci; SANTOS, Anselmo Luis dos (org.) Critical dimensions of labor reform in Brazil, Campinas, SP: Curt Nimuendajú, 2018.

[xi] WG Worlds of Work: Reforms, CESIT/Unicamp. Technical note: “Employment, work and income to guarantee the right to life”, April/2020.

[xii]See: DIEESE, Technical Note No. 224, March 23, 20. Available here.

[xiii] DIEESE. Technical Note No. 223, March 17, 20: The coronavirus pandemic and the anemia of the Brazilian economy. Available here

[xiv] One veto was the expansion of the Benefit of Continued Provision, BPC, expanded to 50% of the SM.

[xv] See studies by MANZANO, Marcelo and BORSARI, Pietro. Available here.

[xvi]CNI: New industry proposals to mitigate the effects of the crisis. April, 2020. Available here.

[xvii] Check the study by MANZANO, Marcelo and BORSARI, Pietro, already cited (note 16).



[xx] R$3.135 and R$12.202,00, respectively.

[xxx] It is worth noting that 84% of companies have up to 9 employees and, in general, are companies with less capacity to cushion the demand shock during the crisis. It is reasonable to assume that the measure will be ineffective, given that, by not effectively ensuring employment, companies with a low level of productive activity may choose to lay off, especially less qualified workers, to replace or rehire them when the need arises. economy resumes.

[xxiii] Law No. 10.101/2000 – PLR; Law No. 13.636/2018 – Microcredit; Law No. 13.846/2019 - INSS Benefits and Expertise; Law nº 12.682/2012 – archiving, electromagnetic means; Law nº 7.855/1989 – labor fines; Law nº 9.601/1998 – fixed-term contract; Law nº 5.889/1973 – rural work; Law nº 12.023/2009 – movement of goods and occasional work; changes in the categories of archivist, artist, actuary, journalist, publicist, broadcaster, secretary, sociologist, insurance broker and car caretaker.

[xxiii] Related: I – reception and forwarding of proposals for opening demand deposit accounts, savings accounts, microinsurance and acquiring services; II – receipt and forwarding of proposals for the issuance of a payment instrument for transferring electronic money to a prepaid payment account; III – other services and products developed and priced for the development of the productive activity of micro-entrepreneurs, pursuant to art. 1 of this Law; IV – non-judicial collection; V – carrying out follow-up, guidance and qualification visits, and preparation of reports; VI – digitization and custody of documents, as a trustee.

[xxv] Vazquez, Barbara V. Correspondent banking and outsourcing: the underground of labor relations in the financial sector in Brazil . Master's dissertation presented to IE/Unicamp, on February 28, 2018. Available here

[xxiv] In reference to the term used by Karl Polanyi, in The Great Transformation (1944).

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