Brazil has halted construction of an electric car factory by Chinese company BYD over alleged labor law violations, according to Bloomberg.

The report quoted Brazilian authorities as saying on Monday that they had discovered that 163 Chinese workers were working and living in slavery-like conditions at BYD's plant in Bahia state.

The 163 employees were said to be working beyond Brazil's legal working hours, sometimes even seven days a week.

The Brazilian labor department disclosed that the employees are living in deplorable conditions, with some sleeping on beds lacking mattresses and requiring 31 people to share a single bathroom.

Brazilian authorities have closed their accommodations pending confirmation from local regulators that it meets the relevant standards.

The employees were hired by construction company Jinjiang Construction Brazil Ltd, which has withheld their passports and most of their wages.

BYD said on Monday it had terminated its cooperation with the construction company and pledged to safeguard the rights of subcontracted workers and relocate all employees to hotels.

The company reiterated its commitment to comply with all Brazilian compliance requirements, especially in terms of labor safeguards and human rights requirements.

BYD's Brazilian electric vehicle plant, in which it is investing up to R$3 billion, will go into production next year.

Brazil has become a top-selling market for BYD's plug-in electric and hybrid vehicles, with sales of more than 66,000 units this year through November.