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At a time in history when the topics of diversity and inclusion are more and more relevant, a federal law enacted in 2023 is causing great controversy, even forcing a rush to the courts to ensure its compliance.

On July 3, 2023, Law #14,611 came into force with the purpose of promoting equal pay and remuneration criteria between women and men. It amends the Consolidation of Labor Laws (CLT) by guaranteeing the right to claim compensation for moral damages in cases of discrimination based on gender, race, ethnicity, birth, or age, in addition to assigning a fine of ten times the value of the new salary owed by the employer to the discriminated employee – doubled in case of recurrence.

However, the controversy remains, especially when the law obliges legal entities governed by private law, including companies in general with one hundred or more employees, to publish salary transparency and remuneration criteria reports every six months. Nevertheless, the protection of personal data provided for in Law #13,709/2018, also known as LGPD (General Data Protection Act), should be noted.

In an effort to protect personal data, the law requires the anonymization of data and information. This way, it is possible to objectively compare salaries, compensation, and the percentage of direction, management, and leadership positions held by women and men. This data would be accompanied by information that could provide strategies on other possible inequalities arising from race, ethnicity, nationality, and age.

Despite the lawmaker's concern with the protection of personal data, the Government has in its favor the legal basis for compliance with the legal obligation, provided for in article 7, II of Law #13,709/2018. In other words, if a Law mandates compliance with any measure that exposes someone's personal data, said Law must be effective due to the legal basis that supports the exposure without the need for the data subject's consent. On the other hand, in Colombia, for example, there is Resolution #2881 of July 15, 2018, which obliges the pharmaceutical and health technology industry to disclose all payments made to health professionals, so that the population can know where there is or there is not a potential conflict of interest. However, due to the absence of a legal basis for compliance with the legal obligation in the Colombian Personal Data Protection Law, that is, Law #1,581/2012, the data subject's consent is always required. Therefore, if the healthcare professional does not consent to the exposure of their personal data, said data cannot be displayed by the pharmaceutical and health technology industry.

The Brazilian LGPD defines sensitive personal data as personal data on race or ethnicity, religious conviction, political opinion, membership to a trade union or organization of a religious, philosophical, or political nature, data relating to health or sexual life, genetic or biometric data, when linked to a natural person. As can be seen, financial data or criminal records, for example, are data whose disclosure could cause a significant impact on the data subject. In this case, financial data.

To complement all the information, Decree #11,795 of November 23, 2023, was enacted, which standardized the mandatory information to be disclosed by legal entities governed by private law in the Salary Transparency and Remuneration Criteria Report. The information is as follows:

1. Contractual salary

2. Christmas bonus

3. Awards

4. Commissions

5. Overtime

6. Night shift, unhealthy, hardship, and hazard allowances, among others

7. One-third vacation premium

8. Notice of termination period

9. Paid weekly rest period

10. Tips

11. Regarding other installments, which, by law or collective labor norm, make up the worker's remuneration

Also according to the aforementioned decree, the publication of such reports must occur in the months of March and September, and must be sent in a specific format and procedure established by the Ministry of Labor and Employment.

However, the core of the controversy is the mandatory publication of this report on websites of legal entities governed by private law, on social networks, or similar instruments, ensuring wide dissemination to their employees, collaborators, and the general public. This obligation puts an end to salary confidentiality, which is closely guarded by any Human Resources department, and calls meritocracy into question, as it attempts to standardize income under the argument of gender equality. Furthermore, it unnecessarily exposes senior executives to all types of scammers and kidnappers, since, despite the supposed anonymization, since they will know that in private legal entity X there is a manager, director, vice president or similar who receives the amount Y.

Therefore, it is concluded that the effectiveness of anonymization is relative, especially for positions where there are one or two professionals, making it very easy to identify who they are and rendering anonymization impossible.

Aware of the problem, the Brazilian Confederation of Industry (CNI) and the Brazilian Commerce Confederation (CNC) filed, on March 12, 2024, a Bid to the Supreme Court Original Jurisdiction with the scope of requesting the following in court:

a) unconstitutionality of the expression “regardless of non-compliance with the provisions of Article 461 of the Consolidation of Labor Laws, approved by Decree-Law #5,452, of May 1, 1943”, contained in Paragraph 2 of Article 5 of Law #14,611/2023, for direct violation to equality (Articles 5, caput and items I, V, X; and 7, item XXX, of the Brazilian Constitution of 1988).

b) partial unconstitutionality, without reducing the text, of Paragraph 6 of Article 461 of the CLT, amended by Article 3 of Law #14,611/2023, so that the Honorable Court, through interpretation in accordance with the Brazilian Constitution of 1988, establishes an interpretation so that the claim for moral damage may only be cumulative if there is a situation of discrimination in the strict sense (requiring intent), without this hypothesis being equated with the mere objective existence of a salary difference, in line with the principle of legal certainty.

c) partial unconstitutionality, without reducing the text, of Article 5 of Law #14,611/2023, so that the Honorable Court, through interpretation in accordance with the Brazilian Constitution, establishes an interpretation in the sense that it is not possible to apply any penalty (and notably the imposition of the preparation of the action plan) without the inspected employer having previously had the opportunity to present a defense, just as it is not possible to publish salary transparency reports and remuneration criteria that involve the disclosure (specifically, by the average or median) of salary values and remuneration linked to position or function, with respect to the Articles 1, item IV; 5 items V, X, LIV, LV and LXXIX; and Article 170, item IV, all from the Brazilian Constitution of 1988.

d) unconstitutionality, by entrainment, of Decree #11,795/2023 and MTE Ordinance #3,714/2023, which, by regulating open legal provisions, committed the mentioned violations, as they were emanated within the scope of the unconstitutional interpretation of the Law.