Brazil Opposition to Appeal to Supreme Against Minimum Wage Law

Brazilian real currency In Brazil, no sooner had the country’s Senate passed the new minimum wage law and the opposition party, DEM, announced that it will file a lawsuit at the Supreme Court opposing Article 3 in the bill. This article allows the president to make adjustments to the minimum wage over the next four years without consulting Congress.

In plain language, the president gets the power to set the minimum wage by presidential decree. Senator Demóstenes Torres (DEM. Goiás state) says the article is unconstitutional as the minimum wage can only be established by means of a law and a law always requires legislative approval.

Torres says the DEM believes it has a strong case based on previous Supreme Court decisions that have always dismissed executive branch attempts to set the minimum wage.

Wednesday night, in the Senate, a total of eleven amendments to the government’s minimum wage bill were presented in attempts to make changes and all of them failed. Eight were rejected in so-called symbolic votes (party leaders voting). The other three were voted down on the floor in nominal votes.

An amendment by the DEM to set the minimum wage at 560 reais (US$ 336) was rejected by a vote of 54 to 19. A second amendment, setting the minimum wage at 600 reais (US$ 360) was rejected when 55 senators voted against it.

The third amendment, presented by senators Alvaro Dias (PSDB, Paraná state) and Lúcia Vânia (PSDB, Goiás), aimed at revoking the article in the government’s minimum wage bill that would allow president Dilma Rousseff to set the minimum wage by presidential decree following guidelines established in the bill.

This amendment was voted down 54 to 20. The guidelines for setting the minimum wage are: the sum of inflation of the prior year (based on the Broad Consumer Price Index – IPCA) and GDP growth of two years prior.

As the Senate made no changes in the bill approved by the Chamber of Deputies last week, the minimum wage bill now go to the Palácio do Planalto (Brasilia’s White House) where the president will sign it into law.

Unemployment

Unemployment in Brazil’s seven major metropolitan areas rose to 10.4% in January, according to the labor union-linked Department of Statistics and Economic Studies (DIEESE). Compared to December, that was an increase of 0.3 percentage points (it was 10.1%). `

However, compared to January 2010, unemployment is down 2 percentage points (it was 12.4%). Two of the metropolitan regions had lower unemployment and five had an increase.

The DIEESE unemployment survey is carried out monthly in Belo Horizonte (unemployment of 7.7% in January, up from 7.1% in December), Fortaleza (8.5%, up from 8.3%), Porto Alegre (7.3%, up from 7.2%), Recife (13.5%, up from 12.8%) and São Paulo (10.5%, up from 10.1%).

The survey also takes place in the Distrito Federal (Brasília), where unemployment actually dropped from 12.9% to 12.6%, and in Salvador (13.6%, down from 13.8%).

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