Hello! Welcome to the ORGATEC blog. Today we will discuss two fundamental labor rights in Brazil: Maternity Leaveand Sickness Benefit. Understanding how these benefits work is essential not only for workers but also for your company’s financial planning and management.
Maternity Leave: How Does It Work?
Maternity Leave is a right guaranteed by the Federal Constitution and regulated by the Brazilian Labor Code (CLT). It ensures that pregnant employees and adoptive parents receive 120 days of paid leave, which can be extended to 180 days for companies that join the Empresa Cidadã (Citizen Company) Program.
Who Pays for Maternity Leave?
During the 120-day leave, the maternity salary is paid by the company, but this amount is directly offset against social security contributions (INSS). This means that even though the company makes the payment, the cost will ultimately be borne by social security, as the company will deduct the amount paid to the employee from its INSS due. For example, if a company has R$ 10,000 to pay in INSS and has paid R$ 3,000 in maternity salary, it will only pay R$ 7,000 in INSS.
For companies participating in the Empresa Cidadã Program, the additional 60 days are paid by the company itself, but there are tax benefits, such as the deduction of the paid amount from the Corporate Income Tax (IRPJ). This benefit is exclusively available to companies under the Real Profit taxation regime.
Sickness Benefit: How Does It Work?
Sickness Benefit is granted to workers who are on leave for more than 15 days due to health problems.
Who Pays for Sickness Benefit?
For the first 15 days of leave, the company continues to pay the employee’s salary normally. From the 16th day onwards, the responsibility for payment is taken over by INSS, which calculates the benefit based on the worker’s average salary.
Does INSS Pay 100% of the Salary?
No! The amount of the Sickness Benefit is calculated based on the average salary of the last 12 months (or less if the worker has fewer contributions). The benefit corresponds to 91% of this average, respecting the INSS ceiling. This means that workers with higher salaries may experience a significant reduction in their earnings during the leave.
Does the Company Have to Cover the Difference in Salary?
By law, the company is not required to cover the difference in salary for employees on INSS leave. However, some collective agreements or individual contracts may provide for a salary supplement to prevent significant income loss for employees.
What Happens if INSS Delays the Benefit Payment?
If there is a delay in granting the Sickness Benefit, the company is not required to pay the employee’s salary after the initial 15 days. Unfortunately, bureaucratic processes can take time, and the employee may need to appeal to INSS or even take legal action to ensure benefit payment.
Conclusion
Understanding the rules of Maternity Leave and Sickness Benefit is crucial for your company’s financial planning and to avoid unexpected issues. Programs like Empresa Cidadã can offer significant tax incentives. Count on ORGATEC to assist your company with labor law matters!