15 de august de 2025

Outsourcing contract: what it is, how it works and how to do it

Outsourcing is a well-established practice in the Brazilian labor market, allowing companies to contract services from other specialized firms instead of maintaining an in-house team for all their activities. This outsourcing strategy, in addition to reducing costs and increasing operational efficiency, also requires legal attention, especially when drafting an outsourced service contract.

In this article, we’ll explain what an outsourced service contract is, how it works, its main benefits, Brazilian legislation, the permitted duration, how to draft this type of contract securely, and even present a practical template.

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What is an outsourced services contract?

An outsourced services contract is the legal instrument that formalizes the relationship between a contracting company and a service provider. It clearly and precisely defines the activities to be performed, the deadline, payment terms, responsibilities of each party, penalties, and specific legal protection clauses.

In outsourcing, the contracting company does not establish an employment relationship with the service provider’s employees. This means that the responsibility for hiring, remuneration, and labor and social security obligations remains solely with the outsourced company, although the contracting company has the obligation to monitor compliance with legal obligations.

This type of contract is widely used in activities such as cleaning, security, reception, information technology, logistics, building maintenance, and others.

How does an outsourcing contract work?

An outsourcing contract operates based on the provision of a specific service by a specialized company, without any direct subordination between the outsourced workers and the contracting company.

The service provider makes its employees available to perform specific tasks within the contracting company’s structure. However, this service provision must follow contractual guidelines, respecting the administrative autonomy of the service provider.

The main elements of an outsourcing contract are:

A clear description of the services to be provided;
The absence of an employment relationship between the outsourced worker and the contracting company;
The mandatory compliance with labor laws by the contracting company;
Constant oversight by the contracting company, which may be subsidiarily liable for any labor irregularities;
The definition of deadlines, goals, and payment terms agreed upon by the parties.

This contractual model is essential to ensure legal certainty for the parties and avoid future disputes.

What are the benefits of outsourcing services?

Outsourcing offers several operational, strategic, and financial advantages for companies. Here are the main benefits:

Reduced operating costs

By outsourcing certain services, the contracting company avoids costs related to recruitment, payroll, labor charges, and training, transferring these responsibilities to the service provider.

Focus on core business activities

Outsourcing allows the company to concentrate its resources and efforts on its core business, while specialists handle the secondary activities.

Access to specialized labor

Outsourced companies generally have experience and professionals trained in specific areas, which can result in higher-quality services.

Contractual flexibility

Timelines and scope of services can be adjusted according to demand, facilitating adaptation to periods of business expansion or contraction.

Increased productivity and efficiency

With qualified teams and more agile processes, outsourcing tends to increase operational efficiency.

What does the new law say about service outsourcing contracts?

Law No. 13,429/2017, later amended by Law No. 13,467/2017 (Labor Reform), regulated outsourcing in Brazil, allowing companies to contract to provide services in both the core and non-core activities of the contracting company.

The legislation also imposes certain requirements:

The service provider must be properly registered and have an active CNPJ (Brazilian Corporate Taxpayer Registry);
It must demonstrate economic capacity compatible with the number of employees;
The contracting company is jointly liable for labor rights not paid by the service provider;
Outsourced workers must have safe working conditions and access to the same benefits as the contracting company’s employees (such as cafeterias and transportation).

The law brought greater legal certainty to companies and workers, as long as the regulations are properly followed.

How long can an outsourcing contract last?

Brazilian law does not stipulate a maximum term for outsourced service contracts. The duration can be freely defined by the parties, as long as it is compatible with the nature of the service provided and does not constitute labor fraud.

It’s common for contracts to have an initial term of 12 to 24 months, with the possibility of extension through contractual amendments.

However, it is essential that the service provision be continuous, lawful, and well-founded, to avoid establishing subordination or a disguised relationship with the contracting party.

How to draft an outsourced contract?

Drafting an outsourced contract requires attention to detail and clarity in the clauses. See the step-by-step guide:

Step 1: Identify the parties

Include complete information about the contracting party and the service provider (company name, CNPJ, address, legal representative).

Step 2: Purpose of the contract

Precisely describe the service to be provided, specifying the scope, deadlines, and locations of performance.

Step 3: Obligations of the contractor

List the service provider’s responsibilities, such as providing qualified labor, equipment, uniforms, and compliance with labor laws.

Step 4: Obligations of the contractor

Establish the obligation to oversee the performance of the services, provide adequate conditions, and pay invoices.

Step 5: Payment Terms

Determine amounts, payment methods, due dates, adjustments, and late fees.

Step 6: Terms and Term

Define the start date, contract duration, and possibility of extension.

Step 7: Penalties and Termination

Include clauses regarding penalties for non-compliance, termination conditions, and obligations in the event of contract termination.

Step 8: Jurisdiction and Applicable Law

Establish the competent jurisdiction for resolving disputes and the applicable law.

Outsourcing Contract Template

Below is a basic template for an outsourcing contract clause:

OUTSOURCING SERVICES CONTRACT

CONTRACTING PARTY: [Company Name], headquartered at [address], registered with the CNPJ (National Registry of Legal Entities) under No. […], herein represented by its legal representative [full name];

CONTRACTED PARTY: [Company Name of the provider], headquartered at [address], registered with the CNPJ (National Registry of Legal Entities) under No. […], herein represented by its legal representative [full name];

CLAUSE 1 – SUBJECT: The purpose of this contract is the provision of [description] services, to be performed at the contracting party’s premises or at another location designated by the contracting party;

CLAUSE 2 – CONTRACTOR’S OBLIGATIONS: The contractor undertakes to provide a qualified team with proper employment records and to supply all materials and equipment necessary to perform the services;

CLAUSE 3 – CONTRACTING PARTY’S OBLIGATIONS: The contracting party undertakes to provide adequate conditions for the performance of the services and to make payments as stipulated;

CLAUSE 4 – PAYMENT: The monthly service fee will be R$ […], payable by […], upon issuance of an invoice;

CLAUSE 5 – TERM: The contract will begin on [date] and will be valid for [12/24 months], and may be extended for the same period by means of an addendum;

CLAUSE 6 – TERMINATION: The contract may be terminated by either party upon 30 days’ notice or for cause, effective immediately;

CLAUSE 7 – JURISDICTION: The jurisdiction of the district of [city/state] is hereby elected to resolve any disputes arising from this agreement.

In agreement, the parties hereby sign this agreement in two copies of equal content.

This is a reference model only. Legal advice is recommended for adjustments based on the specific case.

Conclusion

The outsourcing service contract is an indispensable instrument for ensuring legal certainty in relationships between companies and service providers. When well-drafted, it protects both parties, organizes the provision of the service, and reduces labor and tax risks.

Furthermore, outsourcing is an efficient strategy for increasing business productivity and competitiveness, as long as it is adopted within legal parameters. Therefore, the support of a specialized lawyer is essential to structure clear clauses, ensure compliance with the law, and protect the company’s assets against potential litigation.

If your company wishes to outsource safely, rely on qualified legal support from contract drafting to monitoring its execution.