What is outsourcing?

Outsourcing is the act or effect of  hiring another company to perform a certain business function  rather than internally. It is a measure that, from a strategic point of view,  helps to improve the production process,  allowing the company to focus on its  core business  , that is, its core business.

It is also a way of  r  EDUCE costs in the company and guarantees the quality of production, since it hires a third specialized company, in particular a segment, with its own competence and experience, and sometimes it has a lower cost than if the area were implemented in the contracting company. The most important examples are the cleaning and information technology companies created with a focus on the outsourcing offering.

Labor relations, in the case of outsourcing, are the responsibility of the contracted service provider, even if the worker performs his function in the contracting company. Outsourcing is responsible for hiring, training, remunerating and managing the employee.

End of activity

Under the old regulation, subcontracting was only allowed for those considered intermediate activities, which are those that are not related to the main objective of the company, such as cleaning or surveillance services.

The new law authorizes the provision of services for basic activities, which are practiced to perform the function that is objective in the company, such as, for example, hiring external teachers to teach in schools.


The standardization of the outsourcing law did not change the rights of employees provided in the CLT. The guarantees for the workers, with the company that provides services, the responsibilities with the contract and the signed work card, as well as the labor rights, vacations, 13, FGTS, contribution to the INSS and maternity leave were reinforced.

Temporary job

Changing the old law, in which the maximum temporary contract time was 90 days, the new regulation now considers temporary work contracts for a period of 180 days, which can be extended to an additional 90 days.

Advantages of outsourcing

  • Greater productivity and efficiency for the contracting company.
  • Cost reduction (labor, production, maintenance, etc.).
  • Competitiveness, since it gains greater productive capacity at a lower cost
  • Promotion of autonomous activity in the country.
  • Possible reduction of informality in labor relations.

Disadvantages of outsourcing

  • Labor relations are still uncertain, which can harm both employees and companies.
  • Precarious working conditions, a point claimed by the employees themselves.
  • Difficulty in organizing and organizing workers.
  • Lower wages. According to an IPEA survey published in October 2015, outsourced employees receive an average of 17% less than the contractor’s staff.