80 years of the Consolidation of Labor Laws and the Challenges of New Labor Relationships

Unraveling the New World of Work: The Contract between Workers and Digital Platforms like Uber and Ifood

The individualization of the facts applicable in the civil or labor relationship related to UBER and IFOOD drivers, in our view, makes us evaluate not only the contemporary technological development that has taken place, but also the new international businesses that have created autonomous service providers or employees in scenarios that differ from national uses and customs.

Social evolution, the applicability of the concept and legal system based on "Common Law" jurisprudence, and the Industrial and Technological Revolution itself, have brought new realities, which have created environments for these new businesses or labor activities, divergent from previous forms, summarized by article 3 of the CLT, which considers an employee to be any individual who provides services of a non-occasional nature to an employer, under the employer's dependence and for a salary, this coupled with the understanding that there will be no distinctions regarding the type of employment and the condition of worker, nor between intellectual, technical and manual work.

I understand that the activities carried out by UBER and IFOOD drivers are commonly carried out in a decentralized, automated, computerized, globalized environment, which is increasingly flexible and compatible with the autonomous and/or entrepreneurial environment, and, consequently, new forms and ways of providing services and relationships, which are far removed from the traditional model provided for in article 3 of the CLT, which comes from Decree-Law no. 5. 452 of May 1, 1943, sanctioned by President Getúlio Vargas during the Estado Novo period.

Not only is legislation dynamic, but so are the relationships that exist in society. However, the law hasn't changed as fast as technology and the new versions of labor and service providers that have emerged, unlike the flexibility of case law and judicial precedents, which are increasingly replacing codified statutes.

So much so that the Courts and the Federal Supreme Court itself have increasingly come to understand and value Common Law concepts, to the point of making provision in the Labor Reform for the consideration that the treaty prevails over the law. Not only that, but what is decided by higher courts creates binding authority for lower courts, and this is how evolution is understood, through the establishment of legal principles and precedents.

And with this flexibility and ability to adapt to new situations, uses and customs, our rules have been molding themselves to new social practices.

With these changing uses and customs, arising from the formation of legal principles through their reasoning and judgments, now represented by each of the Judges, the Panels of each of the Courts, including the Supreme Courts, is that the continuous and current development of our law or current source and legal form has been taking place.

But, until the effectiveness of these uses and customs, of the seating of interests and understandings, it is that disagreements on the same subject are created, hence the absolute transcendence and beyond the parties of each of the processes, and so, it is that, the Brazilian Justice has also been diverging in its interpretations, and on this basis is that we write about this theme, which does not have a single answer, but several, according to the life experiences had by each of such judges, lawyers and other legal interpreters as doctrinators and great scholars.

This in itself explains the divergence between the judgments of the 1st, 4th, 5th, 7th and 8th panels of the TST, and the judgments of the 2nd and 3rd panels of the same proclaimed Court.

To be an employee is to be a natural person, who is subordinate, who provides usual services to an employer, in return for payment, with no differentiation in the type of work, intellectual, technical or manual. It should be noted that the Courts recognized the relationship on the basis of the principle of the "reality contract", which meant that fraud applied by the contracting parties could be ascertained, especially in the period prior to the labor reform, the maximum concept of which was that the law prevailed over the agreement.

Self-employed or entrepreneurial work has always existed, but these are being increasingly challenged by new technologies and concepts.

Demonstrating in practice how these paths have been altered, we have, for example, the new experience taken on by UBER drivers:

i. Drivers own or lease their vehicles (car or motorcycle);

ii. Drivers enter into a civil contract with UBER, authorizing the use of the technology, for the agreed price/cost (usually around 20-25% of the ride), in order to obtain certain services favorable to their activity, including, but not limited to: finding the closest available vehicle to the consumer's location; defining the cost of said trip through the system; defining, through the geolocation system, the quickest route for the consumer to make the trip.

iii. Drivers can choose to work for as long as they like, for as many hours as they like, take lunch or not and for as long as they like, and if there is a service used, and only in this case, will UBER's financial management deduct their contractual payment and pass on the rest to the driver, in the account chosen by the driver;

iv. In our opinion, the quality of subordination, as the legislator dared, is no longer present, and neither is payment by salary, by the hour or by production, since it is the driver himself who defines these working conditions and profitability, who therefore has clear autonomy, and in accordance with the new forms adopted by technology; this does not mean that judges, courts and higher courts cannot assess the specific case, not least because of the concept of jurisdictional free will, which is guaranteed to judges by law.

v. However, our understanding is that, in the case of UBER drivers, except in rare exceptions, there will be no employment relationship between the UBER company and them, as they have a de facto relationship of providing services through the use of associated technology, through a civilly represented contract, which is not to be confused with the relationship and requirements of an employment relationship.

As for the IFOOD drivers, they register as couriers on that platform, and for that purpose they are used and called, in accordance with the commercial sales made through the same IFOOD platform by bars and restaurants to end consumers. As such, these drivers have the following characteristics:

i. The relationship between the drivers and IFOOD is linked solely to the use of the technology that calls them, summons them by the average proximity found between the place where the food is sought and the place where it is delivered to the consumer;

ii. If you are not within this proximity, you will not be called for any service;

iii. On the other hand, the IFOOD driver could also be inactive at that moment or at that time, which proves that it is he who chooses his period of service, the number of deliveries he wants to make that day, or even whether or not he wants to serve that customer at that time;

iv. The IFOOD company is a technology company and not a service company, which acts as a "middle ground" between the commercial establishments signed up as partners (restaurants, bars, bakeries, supermarkets, among others) and the end customers; these contracting companies pay the IFOOD company a percentage of around 20/25% and of this, there is a partial transfer to each of the drivers;

v. Generally, drivers own or lease their vehicles (car or motorcycle), scooters or bicycles, or any other form they like;

vi. Drivers therefore obtain technological services that are favorable to their activity, including, but not limited to: bringing the driver closer to each IFOOD customer, calling the customer(s) according to the proximity of the delivery source to the consumer's delivery address; defining the quickest route for the driver to take their consumer, among other advantages;

vii. Therefore, there is serious damage to subordination (as previously understood by the CLT in this specific case), let alone payment by salary, by the hour or by production, since the link between them is through the use of technology and not through effective labor relations.

viii. And without these, the specific case cannot be interpreted as an employment relationship, even according to the principle of applied reality.

An exception would be made, in the case of IFOOD, if such drivers/deliverymen, for example, from a specific restaurant forced their registered employees to register on the IFOOD platform, so that they could be dismissed at the same time or soon after, and continue in the same way, with certain and determined hours, with direct subordination to the employer, with certain and determined payments or only replaced through the platform, all with the aim of defrauding the employment relationship that had previously existed, replacing delivery motoboys who earned fixed salaries, with this new form

Likewise, there could still be an exception in the case of drivers from employer companies, or even cab or delivery companies, who, like the example above, could impose new working conditions, moving from subordination and fixed salaries to the use of the platform just to hide / defraud the employment relationship.

So, even if new case law and indoctrination are created on these new technology services, the sensitivity of the judiciary to the sudden changes in procedures imposed on employees should not be overlooked. Fraud cannot be allowed because of the cleverness of new case law interpretations.

However, based on the market average applied, this new technological relationship does not create an employment relationship, but rather a new concept that differs from the statutory one.

And this is so real that these drivers can at any time inform the company that they will not be providing services for the period they define, such as a personal vacation, for example, or that nothing prohibits them from owning or leasing the vehicle or means of transport, having two or more options for registered platforms (which is common), or performing other services, even if they are private, for offices or families, whoever needs them, which again makes them different from the provisions of 1940 (CLT) and its updates.

Another reason why this segment has grown so much is that some people have been using them as a second income and not as a second job, taking advantage of days off or even rest days or vacations as a way of helping with the family budget, which would not be compatible in our view or with employment.

For these reasons, I believe that the best kind of these relationships is to broaden the understanding that there is no employment relationship, which strengthens the concept that this is the new principle of the reality contract, except if the legislature (by government order) changes this concept, not only to collect income tax from them, but also on the way of working and the creation of fixed minimum wages, social security and supervision, which could lead to changes again by our Courts.

By,

MARCOS EDUARDO PIVA

PIVA ADVOGADOS ASSOCIADOS