Opposition senators prevented Senate President Eunicio Oliveira and some of his allies from reaching their desks for a scheduled vote. That led Oliveira to order power and microphones cut. He adjourned the session, apparently to move the vote elsewhere.
Before the live video feed from the chamber was cut, senators could be seen tapping on their phones and chatting with one another in a darkened room. Hours later, the session remained suspended.
Brazilian media have predicted the bill will pass, despite polls showing it's unpopular.
The bill would also make it easier to hire temporary workers, even for extended periods of time.
The bill is a key part of Temer's agenda, which also includes raising the retirement age and making it easier to outsource work.
Allies of the president believe that a victory on the labor law would give him a boost before the Chamber of Deputies votes on whether to suspended him from office and put him on trial for corruption.
Temer is accused of accepting bribes from a meatpacking executive in exchange for helping the company obtain favorable government decisions. He denies wrongdoing.
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