As a result of a project developed by the Organization for Economic Cooperation and Development (OECD), the Inter-American Bank of Development (IDB) and the International Centre for Tropical Agriculture (CIAT), a report that shows labour costs in Latin America and the Caribbean was published. Argentina leads the ranking, with a tax burden of 34.6% on wages, followed by Brazil (32.2%).

The report points out that most countries in the region have elevated formalization costs, which directly leads to high informality rates and undeclared work.

The Brazilian government has taken these arguments and moved forward with a labour reform that has no precedents in the country and in the region. The reform was passed by the Congress of July 11^th 2017, and it structurally modifies and makes more flexible the “Consolidation of Labour Acts” (or CLT).

The reform is expected to have a major impact, dramatically improving the competitiveness of the country, particularly when compared to the rest of the region.

For instance, the World Economic Forum (WEF) states that Argentina is number 133 among the 138 countries studied in terms of rigidity and labour costs. Prior to the reform, Brazil was number 119, and, according to expectations, it will climb over thirty positions on a global level. In other words, it will beat Argentina for over forty positions in this ranking.

The key points of the Brazilian reform are:

• Union dues become, which up to now were compulsory, become optional.
• Labour outsourcing: the reform enables companies to outsource any kind of activities, even core activities.
• More autonomy to employees in negotiations with employers and more importance to the union-negotiated collective conventions and bargaining agreements, which will prevail over the law
• Intermittent work: wages might be paid based on hours or days (instead of on a monthly basis), and employers can summon workers with a minimum period of time of three days prior starting working.
• Other changes: workdays may last up to 12 hours per day, with 36 hours of rest after; the prior notice period goes down from 30 days to 15 days; vacations may be divided in up to three periods; commuting to the workspace is no longer considered as working time; etc.

Changes in tune with the concepts of the future of work must be addressed with a different perspective on the regulatory frameworks designed for the concept of work of the 20st century.