Salary reduction program ends; know how it looks from now on

The labor agreements, to reduce the working hours and wages, ended this Wednesday, August 25, 2021. They were part of the Emergency Program for the Maintenance of Employment and Income (BEm). An new proposal to extend the Bem, on the other hand, has already been forwarded to Congress.

Submitted by the government, the MP was approved by the Chamber of Deputies and will be evaluated by the Senate. Remembering that BEm was created in 2020, as coping measure of the economic crisis caused. The project was intended to grant employers the reduction of employees’ salaries and working hours.

The government released the initiative for companies to reduce by 25%, 50% or even 70% the hours/salaries. According to information supplied by Agência Brasil, nearly 1.5 million companies managed to include around 10 million workers in the program last year. In April 2021, the program was relaunched and reached around 600 thousand companies.

How the wage and working hours reduction program worked

The workers whose agreements were changed by the program received a compensation from the government. Those who had a 25% salary reduction, thus, received 25% on the amount of unemployment insurance, to which he would have been entitled if he had been fired. These amounts were paid every month with resources from the Worker’s Support Fund (FAT).

The government also paid workers who had their contracts temporarily suspended. They received the integral values unemployment insurance, in the case of companies that had, in 2019, up to BRL 4.8 million of gross revenue. For the workers of companies that had an income above this amount, referring to the year 20219, 70% of the unemployment insurance amount and 30% of the salary were paid.

WELL can be extended for another 120 days

A new proposal for the renewal of the BEm was sent through Provisional Measure (MP) 1.045/21, specifically to the National Congress. In the text, which deals with the mini-labor reform, the possibility of extend for another 120 days the reduction of salaries and hours of employees.

The MP, which has already been approved by the Chamber of Deputies, went on to be analyzed by the Federal Senate and still has no date for voting. The property, upon being agreed upon by the company, has as a condition the temporary guarantee of jobs of workers during the period of permanence in the program.