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A guide to hiring independent contractors in Brazil

Hiring independent contractors in Brazil can be a great option, however it is important to avoid contractor misclassification.
Photo of Sao Paolo by Joao Tzanno on Unsplash to illustrate article on hiring independent contractors in Brazil

Hiring independent contractors in Brazil is an excellent option for companies wanting to establish or expand their presence in this massive South American country.

Brazil offers large and growing pools of highly-skilled professionals available at competitive rates, while working with a provider to hire them as contractors also offers trhe benefit of not having to deal with the country’s sometimes overwhelming red tape.

Because when you work with a provider, they will not only be able to help you source outstanding candidates to fill the roles needed, but will also take care of the payroll and administration of those who are contracted, meaning you don’t have to worry about navigating unfamiliar regulations.

SEE ALSO: Call center outsourcing: 5 great destinations to consider 

One such provider is an employer of record (EOR), which can also find and hire employees on your behalf, should that be a more suitable arrangement than hiring independent contractors. In each case, working with an EOR means being able to work internationally without setting up foreign entities. For anyone unsure about which arrangement suits them best, an EOR will be able to offer guidance.

If you are interested in hiring independent contractors in Brazil, or employing professionals via an EOR arrangement, contact us for more information. 

Serviap Global map of Brazil to accompany article on hiring independent contrractors.
Brazil is the largest country in Latin America

Why you should consider hiring independent contractors in Brazil

Brazil is the largest country in Latin America, with a varied territory, culture, and industries. It has abundant renewable and nonrenewable resources, and is one of the world giants of mining, agriculture, and manufacturing, while also boasting a strong services sector. 

The country is seeing an increasing number of new startups, as well as national and international investments in a variety of companies. Agrotech, fintech and ecommerce are some of the sectors that are growing fastest, creating new job requirements and employment opportunities. 

Great talent can be found in all regions when you’re looking for hiring independent contractors in Brazil, despite wage and employment disparities between northeastern and southern states, according to the country’s statistics office (IBGE). The labor market in Brazil is diverse and offers exciting opportunities all across the country.  

Brazil is a regional technology leader, and a good source of high-skilled professionals, especially in tech talent and software development. It offers some of the best global universities in Latin America, like Universidade de São Paulo (USP) and Universidade Federal do Rio de Janeiro (UFRJ). 

Before hiring independent contractors in Brazil, you should also consider the Brazilian time zone, as well as linguistic and cultural differences. The official national languages are Portuguese and Brazilian sign language, but English and Spanish are commonly taught in school and widely spoken among professionals. 

English levels have been increasing due to higher educational levels and government incentives, such as the English Without Borders program, which offers free classes for citizens. Many Brazilians can also understand and speak Spanish, because of the proximity to Hispanic neighboring countries and a strong cultural influence.  

How does hiring independent contractors in Brazil work? 

Independent contractors are freelance professionals who offer their skills and expertise to different businesses, often through online platforms, direct contracts, or EOR agreements. They are self-employed and are not bound by traditional employment requirements. 

One of the key aspects to consider when hiring independent contractors in Brazil is being able to collaborate remotely. They can work with global clients, using technology to communicate, share files, and complete tasks. This flexibility enables contractors to access a diverse client base and work on many projects. 

A photo of Sao Paolo by Vanessa Bumbeers on Unsplash to illustrate article on hiring independent contractors in Brazil
Brazil’s largest city Sao Paolo

International contractors can work for different clients simultaneously, or exclusively for one client at a time. The length and type of agreements will depend on the tasks they are being hired for and could last for a few weeks, months, or even on a long-term basis. Either way, they won’t be legally considered full-time employees. 

So, they do not receive many of the labor benefits and protections of full-time hires, because an international independent contractor is not on the payroll. However, even though this seems to cut some costs, they can still charge more for their services than an employee would for doing the same type of work. 

Hiring independent contractors in Brazil via an EOR 

In general, you can search for Brazilian contractors directly, after you set up a legal entity in the country. In this case, you have to handle recruitment, compliance, management, and payment on your own, which is complex and time-consuming.

A simpler option is hiring independent contractors via an employer of record in Brazil. An EOR will have an established recruitment network and expert knowledge of the local job market, so that outstanding andidates can be found and presented to you.

The employer of record will work as a representative for you in Brazil, and use its established recruitment network to find top professionals. An EOR can also assist you with a preliminary screening of candidates and feedback, collaborating to create the best team. 

So, when hiring independent contractors in Brazil, you can reduce office space, increase production rates, and focus on project efficiency. It also helps you with distributed workforce management, as it becomes easier for you to organize your international team and develop the most efficient workflow. 

Hiring independent contractors in Brazil vs full-time employees 

When you are hiring in Brazil, it’s important to know what type of agreement you are setting, and to avoid contractor misclassification, which can result in legal inconveniences and financial penalties. So it is important to make sure that anyone registered as a contractor is working under conditions that make them eligible for such classification.

In Brazil, formal full-time workers are covered by various benefits, such as health and unemployment insurance, retirement, days off, and so on. These are paid indirectly by the employer, through the National Social Security Institute. Independent contractors, differently, are not entitled to such benefits, and must be classified correctly as independent collaborators. 

Serviap Global graphic illustrating the differences between full time employment and hiring independent contractors in Brazil
Hiring independent contractors in Brazil vs full-time employees

Freelance contractors are paid based on each project, unlike full-time employees, who are usually paid by the hour, week, or month. The payment can be simplified via an EOR, as they can handle the whole process for you when hiring independent contractors in Brazil. 

Other main considerations are the work schedule and tools. Employees are expected to work on set hours, normally using equipment provided by the company. Opposite to that, independent contractors can determine their own schedule but should be responsible for their work tools. 

To get an idea of your misclassification risk, visit the Serviap Global contractor misclassification calculator.

Serviap Global can help you hire independent contractors in Brazil 

At Serviap Global, we support companies with hiring solutions in over 100 nations, including Brazil.

Our services include international PEO / EOR services, contractor hiring, and global talent acquisition services to help companies find direct hires.

Contact us to discover how we can help you with hiring independent contractors in Brazil.

You can also get an idea of costs involved in hiring talent in different countries by using our free paycheck calculator.

Serviap Global can assist clients with EOR services worldwide

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