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During the month of April, approximately two million workers had their work contracts suspended for up to two months due to the crisis caused by the new coronavirus.
As of Wednesday night (22), agreements between employers and employees to suspend contracts or cut wages and hours have already reached 3.5 million workers. Permission for these negotiations was granted in MP (Provisional Measure) edited by President Jair Bolsonaro.
Among those who have reduced hours of work, most will cut their wages by 50% or more.
The information comes from the Special Secretariat for Social Security and Labor of the Ministry of Economy. Workers affected by the cuts will receive compensation paid by the federal government in proportion to unemployment insurance.
The data includes individual agreements and also collective category agreements made through the intermediation of unions.
In total, 569,000 companies have already reported to the government that they had made such deals in the past month based on the MP, which was issued to prevent layoffs during the new coronavirus pandemic.
Micro and small companies, with annual sales of up to R $ 4.8 million, were responsible for 59% of these cuts (2.1 million). Another 35% (1.2 million) were made in larger companies. The activities of domestic workers and others represent 6% of the reductions (226 thousand).
In the separation by type of agreement, the total suspension of the contracts is majority. There were around two million such agreements, 58% of the total.
There are also 563 thousand workers with wages and hours reduced by 50%, which corresponds to 16% of the total. Another 424 thousand people (12%) will be reduced by 70%. There are still 312 thousand (9%) with a reduction of 25%.
Another 167 thousand intermittent workers (5%) will receive compensation. For these professionals, the government understands that there is no suspension of the contract or reduction of the workload, but there is a high probability that they will not be called to work during the crisis. For this reason, they will receive R $ 600 for three months, equivalent to what is paid to informal workers.
The states with the highest number of agreements are São Paulo (29.8%), Rio de Janeiro (10.8%), Minas Gerais (9.8%), Rio Grande do Sul (5.5%) and Paraná (5.4%).
On April 1, President Jair Bolsonaro issued an MP authorizing the reduction of wages and hours of work during the crisis caused by the new coronavirus. Reductions can be made in any percentage, up to 100%.
Affected workers will receive government compensation that can reach 100% of what they would receive from unemployment insurance in the event of dismissal.
In government accounts, the suspension of contracts or the reduction of wages and hours of work should reach 24.5 million workers with a formal contract, more than 70% of all formal employees in the country.
The government launched a website that updates the number of workers affected by the agreements every day (servicos.mte.gov.br/bem). The system was informally called an “employer meter.”
The economic team argues that the signed agreements represent preserved jobs.
According to IBGE, Brazil had 33,624 million workers with a formal contract in the private sector in the quarter that ended in February.
The total cost of the program for public coffers is estimated at R $ 51.2 billion.
By individual agreement, the employer can reduce hours and wages by 25%, 50%, or 70% for up to three months, depending on the worker’s income range. In collective agreements, a reduction of any percentage is allowed.
The government will pay these workers a proportion of the amount of unemployment insurance equal to the percentage of the cut in wages. The compensation will be 25%, 50% or 70% of the unemployment insurance, which ranges between R $ 1,045 and R $ 1,813.03.
The suspension of contracts, in turn, can be done for up to two months. In this case, the employee receives the full amount of unemployment insurance.
