TEMPORARY LAW ALLOWS SALARY REDUCTION TILL 70% AND WORK CONTRACT SUSPENSION.
ECONOMIC SUPPORT MEASURES vs. COVID-19
The reductions can reach 70% and have a maximum term of 90 days.
Contracts may be suspended for up to two months. Affected employees will receive compensation from the government, which can reach up to 100% of the unemployment insurance they would receive in case of dismissal.
Through individual or collective negotiations, the employer can combine the suspension of the employment contract with employees.
Micro and small companies, which earn up to R $ 4.8 million per year, will be able to temporarily dismiss employees without paying any percentage of the salary. In these cases, the government will pay 100% of the unemployment insurance to which the worker would be entitled if he were dismissed. Individual negotiations will be valid for employees who earn up to three minimum wages (R $ 3,135) and for higher level workers who receive more than R $ 12,202.12.
Medium and large companies, which earn more than R $ 4.8 million per year, will have to pay 30% of the salary during the suspension of the contract, with the government paying 70% of unemployment insurance.
In all cases, the employer must maintain benefits during the suspension period, such as food vouchers and allowances, and the employee cannot be required for remote or distance work.
The provisional measure also establishes a provisional guarantee of employment during the period of suspension and after the resumption of work for a period equivalent to that of the suspension.
In other words, a two-month suspension guarantees a four-month job stability.
The employer will also be able to reach an agreement on the proportional reduction of working hours for up to three months, with a decrease in salary in the same proportion. As with suspension, the government will pay the rest of the salary with part of the unemployment insurance to which the worker would be entitled.
The provisional measure provides for three types of reduction in wages and working hours:
– 25% of income, with the government paying 25% of unemployment insurance;
– 50%, with the government paying the remaining 50%;
– and 70%, with the government supplementing 70% of unemployment insurance.
The 25% reduction can be agreed with all employees, individually or collectively. The other decreases can be agreed individually.