New Provisional Measures Enforced in Brazilian Ports

Provisional Measure No. 945 / 2020 was issued by the Brazilian Federal Government, which deals with temporary measures in response to the pandemic resulting from the Covid-19 in the scope of the port sector and on the assignment of yards under military administration.

This Provisional Measure, according to the Federal Government, aims to ensure a safer environment for dockworkers, in addition to recognising the essentiality of Port Operations.

The Executive Order from April 4, changes the Daily call for casual dockworkers, who carry out loading and unloading operations in Brazilian Public Ports.

Currently, these workers are called to engage amidst large agglomerations in the ports, which in times of pandemic is not recommended. The Provisional Measure establishes that the Manpower Management Agencies must carry out the call for casual dockers by electronical means only, so that the worker appears at the port only at the time needed and in order to avoid further agglomerations within port area.

Manpower Management Agencies will not be able to call or engage in operation any dockworker who:

• a) present symptoms compatible with covid-19;
• b) have been diagnosed with covid-19;
• c) who are pregnant or lactating;
• d) aged 60 or over; and
• e) who have immunodeficiency or respiratory diseases or chronic or severe pre-existing diseases.

In this context, the Provisional Measure assures workers in the above situations the right to receive a monthly compensatory indemnity of 50% of the monthly income average received between October 1, 2019 and March 31, 2020, as long as impediment persists.

It is worth mentioning that casual dockworkers, retired or enjoying any other benefit granted by the General Social Security Regime or their own social security regime, as well as those who perceive the assistance benefit for individual dockworkers, provided for in Law No. 9,719 of November 27, 1998, will not be entitled to the indemnity provided for in the Provisional Measure.

The payment of compensatory indemnities will be borne by Port Operators and will be calculated in proportion to the amount of the monthly service demanded.

The aforementioned amount will be calculated and collected by the Manpower Management Authority and later passed on to the casual dockworkers.

Port Operators will be entitled to a discount on port tariffs in the amount equivalent to the increase in cost, resulting from the payment of indemnity, or economic and financial re-balancing of their contracts, in cases where they have lease agreements with the public port.

In the Provisional Measure, it was also adjusted that the benefit to be paid to dockworkers may be excluded from net income for purposes of determining corporate income tax and Social Contribution on Net Income of legal entities taxed by taxable income.

The Provisional Measure establishes that in the event of unavailability of casual dockers to meet the work demand, Port Operators may freely hire workers with an employment contract for a specified time to carry out services as foreman, block, stowage, cargo conference services, cargo repair and vessel surveillance.

The hiring of workers with an employment relationship based on unavailability cannot exceed the period of 12 months. In addition, it will possible to engage contract directly with workers that or not authorised or registered with the Manpower Management Authority.

Said Provisional Measure, guarantees Port Operators flexibility in the exclusivity of hiring labour from the Manpower Management Authority system.

It is worth mentioning that the new rule issued by the Federal Government, considered unavailability of port workers as any cause that results in the immediate non-fulfilment of calls submitted by Port Operators to OGMO, such as strikes, shutdown movements and standard operation.

Finally, the Provisional Measure encourages multi-functionality, to ensure that port operations are not suspended or delayed due to a lack of qualified labour.