Contract suspension and workload reduction program guarantees stability to 9.2 million workers | Contests and Employment

The numbers were released in the latest balance sheet of the General Register of Employed and Unemployed (Caged).

The so-called Emergency Employment and Income Preservation Benefit (BEm) provides that workers have the right to stability for a period equivalent to the suspension of the contract or reduction of the workload. Thus, when the employee and employer made the agreement within the program, the worker could not be dismissed for the same time as the reduction of working hours and wages or suspension of the contract lasted..

For example, if the worker made a working and salary reduction agreement with the company in April of this year for a period of 4 months (from April to August), he guaranteed the right to stability for the next four months – from September to December.

As the program lasted for eight months last year (April to December 2020), those who remained in it throughout the period had guaranteed job stability for the next eight months – that is, they were able to remain in employment until August. This year, the program was relaunched in April and came to an end this Wednesday (25).

The Caged numbers that show the number of workers still under the stability of the BEm are estimates made with the support of the Inter-American Development Bank (IDB). And consider the agreements signed in 2020 and 2021, until July 1 of this year.

While in June the number was 3.5 million employees, in August it drops to 2.7 million. In December, the estimate is for 1.27 million workers with temporary stability. See the chart below:

Stable workers — Photo: Economy G1

The employer who dismisses the employee without just cause during the period of temporary stability will be liable for compensation ranging from 50% to 100% of the salary, depending on the case:

  • 50% of the salary to which the employee would be entitled in the period of temporary employment guarantee, in the event of a reduction in working hours and salary equal to or greater than 25% and less than 50%;
  • 75% of the salary to which the employee would be entitled during the period of temporary employment guarantee, in the event of a reduction in working hours and salary equal to or greater than 50% and less than 70%;
  • 100% of the salary to which the employee would be entitled during the period of temporary employment guarantee, in the event of a reduction in working hours and salary by a percentage higher than 70% or of temporary suspension of the employment contract.

Government tries to relaunch program

The Emergency Employment and Income Preservation Benefit (BEm) was in force from April to December of last year and was relaunched in April of this year. As it is a provisional measure valid for 4 months, the program came to an end this Wednesday (25).

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The government intends to renew the program along the same lines. On August 10, the Chamber of Deputies approved the basic text of the provisional measure that institutes a new round of the Bem.

Chamber includes 'mini-labour reform' in pandemic MP;  understand the proposals

Chamber includes ‘mini-labour reform’ in pandemic MP; understand the proposals

The so-called “highlights” were also included, specific suggestions for changing the text, which create three job generation and professional qualification programs and bring changes to the Consolidation of Labor Laws (CLT). For this reason, the MP is being called a mini-labour reform. The proposal is awaiting analysis by the Senate.

The provisional measure is valid from the moment it is published in the Official Gazette of the Union (DOU) and needs to be approved by the plenary of the Chamber and Senate to become definitive law.

In the case of suspended contracts, salaries are covered by the federal government up to the limit of the unemployment insurance ceiling (R$1,911.84) for employees of companies with gross income of up to R$4.8 million. On the other hand, those who had their work hours reduced receive the company’s proportional salary and a supplement related to part of the unemployment insurance amount, paid by the government.

In both cases, workers are entitled to tenure for a period equivalent to suspension or reduction.

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See how the payments of employment preservation benefits turned out:

  • Suspension of employment contract: receives 100% of the unemployment insurance installment, which can range from R$1,100 to R$1,911.84 (except in the case of employees of a company with gross income exceeding R$4.8 million – in this case case: receives 30% of salary + 70% of unemployment insurance installment)
  • 25% reduction in working hours: receive 75% of salary + 25% of unemployment insurance installment
  • 50% reduction in working hours: 50% of the salary + 50% of the unemployment insurance installment
  • 70% reduction in working hours: receives 30% of salary + 70% of unemployment insurance installment
  • No worker can earn less than minimum wage
  • There is no change in the grant or in the amount of unemployment insurance if the worker is dismissed in the future. Thus, nothing changes in the rules for applying for unemployment insurance.

Number of workers in the program

The government estimate was to preserve 10 million jobs with the program last year. Balance sheet showed that the BEm reached 9.8 million workers.

Almost half of the agreements signed included the suspension of employment contracts. The service sector, the most affected by the pandemic, accounted for more than half of the agreements signed.

This year, between April and June, 2.55 million workers entered the job preservation program, formalizing a total of 3.07 million agreements – 1.3 million for contract suspension (42.2%) and 1 .77 million for workload reduction (57.8%).

The Services sector accounted for 50.3% of the agreements, followed by Trade (24.62%) and Industry (22.26%).