Program that reduces salary ends and has a balance of 23 million agreements – News

After 23 million agreements between employers and employees, the program which allowed for the reduction of wages and hours and the suspension of employment contracts. The last day of the special regime is Wednesday (25), and on Thursday (26), all employment relationships will be back to their normal conditions.

There were 23,367,948 agreements between employers and employees since the beginning of the action, on April 1, 2020. The program ended in December, with the end of the state of public calamity. After the country entered a new wave of the pandemic in the first months of the year and pressure from businessmen after the end of the benefit, President Jair Bolsonaro reedited the program for another four months at the end of April, in view of the restrictions still in force.

According to data available until last Tuesday (17), the reduction of working hours and wages prevailed over the suspension of contracts, which was stronger only in the most acute moments of the pandemic, such as at the beginning of the program. See numbers by modality accordingly.

Suspension of contract: 10,117,441 of agreements
Reduction of salary and working hours by 70%: 5,187,642 of agreements
Reduction of salary and working hours by 50%: 4,414,953 of agreements
25% reduction in wages and hours: 3,465,339 in agreements

The program that seeks to avoid layoffs consists in the payment by the government of part or all of the worker’s salary through BEm (emergency benefit), with a limit of R$1,911.84 per month. The calculation is based on the amount that the worker would receive from the INSS (National Social Security Institute) in the form of unemployment insurance, if he were fired.

The initiative is different from emergency aid, which is mainly aimed at informal workers and low-income families.

In the last four months, the services sector accounted for about half of the agreements, ahead of areas such as industry and construction. In this sector there are establishments such as bars and restaurants, which have only returned to function no restrictions this month in São Paulo, for example.

Another predominant feature in the agreements was the greater participation of women, which accounted for 53% of suspensions and reductions.

“End of cycle”

For Fabio Pina, economist at Fecomercio-SP, the program achieved its objective of working to maintain jobs. “We had 13 million unemployed and that number rose to 14 million, much less than the 20 million that were projected at the beginning of the pandemic. Which shows that the program was very important and was very successful,” he says.

He cites the gradual reduction in demand over time and the reopening of the economy to opine that the program has already ended its cycle. In its first month – April 2020 – nearly 6 million deals were signed. “In the current month, there are only 131 thousand, and may reach about 150 thousand. There are no longer so many voluntary demands from companies and I believe that the role of the program has already been fulfilled”, he says.

He argues that the country needs to focus on improving the business environment, working to promote employment and income. And that, in parallel, it can maintain a specific program aimed at employment and access to credit aimed at sectors still very affected by the pandemic, such as events and tourism.

Project

The government is studying the creation of a permanent alternative program that can be triggered by triggers in emergency situations, such as the pandemic, for example. The possibility is provided for in the draft text that aims to replace the provisional measure that reissued the wage reduction program. The text has already been approved by the Chamber and went to the Senate.

The text also provides that the Executive may extend the emergency program to maintain employment for pregnant women, who could thus continue to rely on reduced wages and contract suspension.