A Labor audit is a topic that has been gaining ground on the agendas of entrepreneurs, financial directors and HR managers who want to grow with legal certainty.
In a scenario of complex legislation, category-specific collective bargaining agreements and increasingly digital inspections, small errors in payroll, working hours control or terminations can turn into millionaire labor liabilities.
Many companies only become aware of these problems when they receive a lawsuit, a notice from the Ministry of Labor or undergo due diligence for sale, merger or entry of investors. At that time, the cost of correction is much higher.
Preventive labor audits are designed to avoid this scenario. It makes it possible to identify faults, risks and inconsistencies before they turn into fines, lawsuits or financial losses.
If you're an entrepreneur or manager and want to understand whether it's worth hiring this service, scroll to the end.
Labor audit: what is it?
Labor audit is a systematic and technical analysis of all processes, documents and routines related to labor relations of a company.
The aim is to check that everything complies:
- Consolidation of Labor Laws (CLT)
- Federal Constitution
- Regulatory standards (NRs)
- Collective agreements
- Social security and FGTS laws
- eSocial rules
In other words, a labor audit is a real “x-ray” of the company's labor area. It is not punitive in nature. On the contrary: it is preventive, advisory and strategic.
The result is a clear, pointed report:
- What's right
- What's at risk
- What needs to be adjusted
- What actions should be taken
- What is the potential financial impact of each failure
This is why labor audits are increasingly being used as a tool for risk management and compliance.
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What is a labor audit for?
In summary, we can say that labor audit is for:
- Identifying hidden liabilities
- Preventing labor lawsuits
- Avoiding administrative fines
- Correct errors before inspections
- Preparing the company for external audits
- Ensure compliance with unions and conventions
- Protecting partners and managers from joint and several liability
Instead of waiting for the problem to appear, the company acts intelligently: it anticipates risks and corrects faults.
Internal labor audit vs. external labor audit
When it comes to reviewing a company's labor processes, you can choose between two paths: carry out the audit internally or hire a specialized external consultancy.
Each model has its own characteristics, advantages and limitations, and understanding these differences is essential to choosing the most effective approach according to the company's objectives.
Below, we explain how each type of audit works and in which situations each one may be most suitable.
Internal labor audit
It's done by the company's own staff, usually HR or in-house legal. Although it helps, it has limitations:
- Lack of impartial vision
- Risk of “normalizing” old mistakes
- Less technical depth
- Conflict of interest
External labor audit
It is carried out by specialized consultancy, such as CLM. Advantages:
- A technical and independent eye
- Structured methodology
- Experience in different segments
- Constant updating of legislation
- Detailed and strategic report
That's why, when it comes to a serious preventive labor audit, the best thing to do is to hire one specialized external consultancy.
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What is audited in a labor audit?
A complete labor audit analyzes all the sensitive points in the employment relationship. Among the main ones, we can highlight:
1. Employment contracts and records
- Existence of a contract for all employees
- Correct registration
- Position compatible with the activities carried out
- Salary according to category floor
- Formalized contractual changes
Failures here create enormous risks, especially in cases of misuse or overlapping of functions.
2. Working hours and time control
- Existence of time control when mandatory
- Time and attendance system in accordance with legislation
- Consistency between time and payroll
- Correct treatment of overtime
- Regular bank hours
- Respected intervals
Journey problems are among the biggest generators of labor lawsuits in Brazil.
3. Payroll audit
The audit payroll is one of the most critical stages:
- Correct calculation of salaries
- Overtime
- Night bonus
- Unhealthy working conditions or hazardous working conditions bonus
- Commissions and variables
- Legal discounts
- INSS and FGTS
A small monthly mistake can turn into a huge liability in a few years.
4. Vacation and 13th salary
- Granted within the legal deadline
- Early vacation pay
- Correct calculation of averages
- Fractionation according to the law
- Payment of the 13th on time
Vacation mistakes generate double fines and are very common in inspections.
5. Benefits and indirect salary
- Transport vouchers
- Meal vouchers
- Health insurance
- Allowance
- Awards
The audit checks whether any benefits are being paid in such a way that they can be considered disguised salary, This is reflected in vacation pay, the 13th bonus, FGTS and INSS.
6. Occupational health and safety
- PPRA / PGR
- Occupational Health Medical Examination Program
- Admission, periodic and dismissal examinations
- Health and safety reports
- Delivery of PPE with receipt
- Mandatory training
Fines in this area are high and liability can reach the partners directly.
7. Contract terminations
- Correct calculation of severance pay
- Payment on time
- Correctly applied fines
- FGTS and connectivity key
- Unemployment insurance when applicable
Errors in terminations are one of the biggest causes of lawsuits.
8. Accessory obligations
- eSocial
- EFD-Reinf
- Digital FGTS
Digital inconsistencies are now easily cross-checked by supervisory bodies.
How does a labor audit work in practice?
Although each company has its own particularities, the labor audit process usually follows these steps:
- Initial diagnosis
- Understanding the business
- Personnel structure
- Segment and applicable conventions
- The sector's main risks
- Document collection
- Contracts
- Payroll
- Point mirrors
- FGTS and INSS forms
- OSH reports
- Terminations
- Collective bargaining agreements
- Technical analysis
A specialized team review everything based on:
- In the CLT
- In regulatory standards
- Consolidated labor court decisions
- Trade union agreements
- Risk mapping
Each fault is classified accordingly:
- Gravity
- Likelihood of generating liabilities
- Estimated financial impact
- Final report
The customer receives it:
- List of non-conformities
- Degree of risk
- Estimated hidden liabilities
- Practical recommendations
- Action plan for correction
- Follow-up
More mature companies also hire in the
- Correction support
- HR training
- Process adjustment
- Periodic reviews
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Advantages of labor audits
Investing in a labor audit is much more than just complying with legal obligations. It is strategy for asset protection, risk prevention and company valuation.
In a complex regulatory environment like Brazil's, complying with labor legislation is not an option, it's a necessity for anyone who wants to grow in a solid and secure way.
Here are the main advantages of carrying out a preventive labor audit in your company:
1. Preventing hidden liabilities
One of the biggest risks for any company is the invisible labor liabilities, These are the errors or mistakes that go unnoticed for months or years, but which can be charged retroactively in inspections or lawsuits filed by former employees.
The labor audit allows anticipate these risks before they become a legal or financial problem, correcting silent flaws such as:
- Incorrectly paid bonuses;
- Days not compensated in accordance with the CLT;
- Contracts with invalid clauses;
- Benefits that characterize indirect salary without due reflection.
In this way, the company protects itself against unpleasant surprises that could jeopardize its cash flow.
2. Real financial economy
Spontaneously correcting mistakes is much cheaper than being caught by surprise by a labor inspection or lawsuit.
By identifying and resolving inconsistencies early, the company avoids them:
- Costly court sentences, with interest, monetary correction and fees;
- Administrative fines which can be up to 200% of the amount owed;
- Defense legal fees in labor disputes;
- Procedural costs and compensation for moral or material damages.
Furthermore, when there is spontaneous regularization, many charges and fines are reduced or even annulled, which generates direct and measurable savings.
3. Improving internal processes
Labor audits not only identify errors, but also reveal operational inefficiencies that affect the company's routine.
For example, it is common for the time control process to have flaws, such as:
In addition, many HR departments operate with lack of contractual standardization, manual entries susceptible to errors and outdated processes.
With the technical recommendations of the audit, the company can modernize your flows, increase productivity and reduce rework, transforming compliance into efficiency.
4. Legal certainty for partners and managers
In Brazil, partners and managers can be held personally liable for labor irregularities in certain situations, especially when there is intent, fraud or proven omission.
A well-executed labor audit significantly reduces this risk by ensuring that:
- All legal obligations are being met;
- The documents are correct and filed properly;
- Internal controls are working.
This brings peace of mind for top management and reduces exposure to assessments, judicial blockages or labor foreclosures that affect personal assets.
5. Valuing the company on the market
Companies that adopt good labor compliance practices are perceived more seriously and professionally by the market. This has a direct impact on strategic situations such as:
- Due diligence in merger or acquisition processes, Audited companies are seen as more reliable;
- Attracting investors or private equity funds, I think it's important to emphasize the solidity of the labor structure;
- Better score in certifications and tenders, especially with ESG criteria;
- Institutional reputation, strengthening the company's image in the eyes of employees, clients and partners.
In other words, the labor audit is not a cost, it's a investment that increases the perceived value of the company on the market.
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Labor auditing and compliance
When we talk about labor audit and compliance, We are talking about aligning the company with a management model based on:
- Compliance with the law
- Transparency
- Risk prevention
- Ethics in working relationships
Auditing is one of the main tools of labor compliance. It:
- Fault detection
- Correct deviations
- Standardize processes
- Create a culture of compliance
Companies that adopt this model have fewer lawsuits, fewer fines and more stability.
Payroll audit: why is it so important?
A payroll is the heart of the labor area. Small mistakes are repeated every month and accumulate:
- R$ error 50.00 per employee
- 20 employees
- 12 months
- 5 years
Result: R$ 60,000.00 in liabilities on just one item.
The payroll audit checks:
- Calculations
- Average
- Incidences
- Discounts
- Taxes
This is one of the most important stages of a preventive labor audit.
When should I have a labor audit?
- Some moments are particularly strategic for the realization of a labor audit, These include:
- Before inspections
- Before the sale or merger of the company
- Entry of investors
- Change of accountant or HR
- Accelerated growth
- Many recent labor lawsuits
- Changes in legislation
But ideally, the audit should be carried out in a way that periodicsuch as:
- Annual
- Biennale
- With every major internal change
Practical examples of problems encountered in audits
In labor audits in medium-sized companies, it is very common to encounter problems of this kind:
- Overtime not paid correctly
- Incorrectly calculated night-time bonus
- Breaks taken without compensation
- Benefits characterizing indirect salary
- FGTS with small monthly differences
- Errors in vacation averages
- Positions incompatible with activities
These errors, added together, can generate liabilities of hundreds of thousands of reais.
How CLM carries out preventive labor audits
A CLM Controller Accounting focuses on preventive labor audits and labor compliance.
Our work is structured to:
- Deep understanding of your business
- Apply your own methodology
- Cross-referencing labor, accounting and social security data
- Mapping risks with a financial vision
- Deliver a clear, objective and actionable report
Our audit is not just technical, it is strategic, It is designed to protect your cash, your brand and your partners.
Who should hire a labor audit?
A labor audit is not just for large companies. It is suitable for
- Small, medium and large companies
- Industries
- Service providers
- Companies with high turnover
- Franchises
- Growing startups
- Companies looking to sell or raise investment
In short, if your company has employees, it has a labor risk and needs to be audited.
Conclusion: don't wait for the problem to appear
Most companies only discover their mistakes when:
- Receives a labor lawsuit
- It suffers an inspection
- Loses a negotiation due to hidden liabilities
By then, it's too late to prevent it, and the only thing left to do is to cure it, and pay dearly.
The preventive labor audit makes it possible:
- Anticipating risks
- Correcting faults
- Saving money
- Protecting members
- Growing safely
Do your labor audit with CLM
Don't wait for an inspector to knock on your door or for an ex-employee to file a lawsuit.
Anticipate. Protect your business. Take care of your cash.
Make your Labor Audit with the CLM Controller Accounting and fix tomorrow's problems today.
Access: https://clmcontroller.com.br/consultoria-trabalhista/
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