End of NR-1's educational grace period: What your company needs to have ready

With MTE inspections now fully punitive, Brazil's Ministry of Labor and Employment can apply fines, work stoppages, and facility shutdowns — inspections are no longer just advisory

As of May 26, 2026, Brazil entered a new chapter in the relationship between companies and the Ministry of Labor and Employment (MTE). The educational grace period for the updated NR-1 regulation — in effect since May 2025 — has ended, and enforcement is now fully punitive, with the possibility of citations, fines, and facility shutdowns. The MTE has made clear there will be no further extension.

For companies headquartered abroad with operations in Brazil, this shift deserves close attention: what may look like a routine occupational health regulation now carries real financial and operational risk, enforced through in-person inspections and cross-referenced against payroll and HR data.

What's changing in practice

The updated regulation, issued under MTE Ordinance No. 1,419, requires companies to identify, assess, and manage psychosocial risks — such as stress, harassment, burnout, and excessive mental workload — as part of their Occupational Risk Management Program (PGR). Penalties range from BRL 2,396.35 to BRL 6,708.08, doubling in cases of repeat violations.

All companies with employees under Brazil's CLT labor regime are subject to the rule, but enforcement prioritizes sectors with high rates of mental health-related leave — banking, healthcare, call centers, construction, transportation, and offshore operations. A recent survey found that 93% of Brazilian companies operate under high psychosocial risk linked to excessive mental workload, underscoring the urgency of the issue.

How enforcement works

The MTE announced it will apply the "double visit" approach provided for under Brazilian labor law: on the first visit, the labor inspector provides guidance and a deadline for corrections. If the irregularity persists, a penalty is applied. From a technical standpoint, inspectors are now evaluating not just whether risks have been identified, but whether there is integration between occupational health and workplace safety programs — a risk management program that ignores data collected during periodic health exams may be deemed insufficient and result in a citation.

The risks of non-compliance

Beyond fines, non-compliant companies become exposed to labor liability claims and operational risks tied to mental health-related absences. In more serious cases, Brazil's Labor Prosecutor's Office can get involved, triggering civil litigation and requiring a formal conduct adjustment agreement (TAC) with the company.

What needs to be in place

To reduce exposure to citations, companies should have the following structured and documented:

• An updated Occupational Risk Management Program (PGR), with psychosocial risks formally identified and assessed

• Integration between the PGR and the Occupational Health Medical Control Program (PCMSO)

• Documented preventive measures for identified risks

• A reporting channel for handling cases of moral and sexual harassment

• Internal training and communication on mental health in the workplace

Conclusion

The window for reactive action has already closed. Companies that still treat NR-1 as an HR administrative matter risk a labor inspector's visit without basic documentation in order. Beyond avoiding fines, compliance protects the company legally and safeguards operational continuity in the face of leave-related disruptions and labor liabilities — a particularly important consideration for foreign companies managing a Brazilian subsidiary from a distance.

DBS Partner closely monitors Brazilian labor enforcement requirements and helps companies structure HR and payroll processes aligned with the new NR-1 obligations. Get in touch with our team and make sure your Brazilian operation is ready for inspection.