Brazil Senate Committee Approves Labor Bill in Boost for Temer

A Brazilian Senate committee has backed a bill to overhaul the country’s decades-old labor laws in a minor boost for the government of embattled President Michel Temer.

The Constitution and Justice Committee voted 16 to 9 in favor of the proposal, which prioritizes direct negotiations between workers and employers. There was one abstention. The bill now moves to a plenary session of the upper house, where the government appears to have a comfortable majority backing the bill.

Michel Temer

Photographer: Christopher Goodney/Bloomberg

Progress on the government’s market-friendly reform agenda comes just days after Michel Temer became the first sitting Brazilian president to face criminal charges. Investors are watching closely to gauge lawmakers’ willingness to stick by the president, or at least his reform agenda, as opposition to his tenure intensifies. Many of his more ambitious proposals, particularly a controversial pension reform, may have to be scaled back as support for the government weakens.

A report by Eurasia Group, published on Wednesday, estimates that between 45 to 50 of Brazil’s 81 Senators support the labor bill, which also relaxes the rules for holidays and overtime. The proposal requires a simple majority to pass in the upper house.

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