Brazil

Brazil is the largest country in South America and the fifth-largest in the world by both area and population. It shares borders with every South American country except Chile and Ecuador. Home to the Christ the Redeemer statue—one of the Seven Wonders of the Modern World—Brazil is a culturally rich and economically diverse country. As a top emerging market, Brazil offers substantial growth opportunities for global businesses, especially those prepared to navigate its complex labor laws and tax system.
Contractor Management
EOR
Payroll
Contractor of Record
Currency
Brazilian real (BRL)
Payroll Frequency
Fortnightly or monthly
Employer Taxes
28.00% to 30.50%

Overview

Population
210+ million
Language
Portuguese
Capital
Brasilia
Currency
Brazilian real (BRL)
Country code
+55
Min wage
R$1,320/month (as of 2025; varies by state and sector)
Working hours
8 AM - 5 PM
Weekdays
Monday to Friday
Work hours per week
44

Payroll

Salaried Employees
Monthly, typically paid on the 5th business day of the following month
Time-Based Employees
13th Salary

Mandatory annual bonus equivalent to one month’s salary, paid in two installments (November and December)

Avg employer tax

28.00% to 30.50% of gross salary

Tax Breakdown

INSS (Social Security)
20%–22.5%
FGTS (Severance Fund)
8%
Other taxes
may apply based on company activity or sector

VAT

VAT

Standard rate of 17%

Tax Calculation for Brazil
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Employer cost
Total monthly cost of employment
Gross monthly salary costs
Estimated taxes and contributions
Employee cost
Net monthly salary
GBP 5,137
Gross monthly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Employer cost
Total yearly cost of employment
Gross yearly salary costs
Estimated taxes and contributions
Employee cost
Net yearly salary
GBP 5,137
Gross yearly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Request a detailed quotation
How it works

Onboarding Process

Onboarding in Brazil typically includes the following steps to ensure a smooth transition for new hires:

Employment Contract

  • Must be in Portuguese and detail salary, working hours, benefits, job duties, leave, and termination terms
  • Should clearly define probation period and notice clauses

Document Collection

  • CPF (Taxpayer Number)
  • RG or National ID
  • CTPS (Work and Social Security Card)
  • Proof of address and education (if applicable)

Labor and Tax Registration

  • Register the employee with:
    • eSocial (digital labor obligations system)
    • INSS (social security)
    • FGTS (severance fund)
    • Caixa Econômica Federal for FGTS account

Benefits Enrollment

  • Register employee for:
    • Mandatory programs: social security, FGTS
    • Optional: healthcare, meal/transport vouchers, dental insurance

Orientation and Training

  • Provide an employee handbook detailing:
    • Company culture and policies
    • Health and safety regulations
    • Ethical code of conduct

Probation Review

Evaluate performance before the end of the probationary period to determine continuation, adjustment, or dismissal

Pre-boarding

Pre-boarding

Pre-boarding

Key Elements of an Employment Contract in Brazil
When drafting an employment contract for employees in Brazil, the following key elements should be included:

Personal Details

Name, contact information, and role of the employee.

Employee Leave Policies

Sick days
  • The employer pays 100% of wages for the first 15 days
  • From the 16th day onward, the INSS covers medical leave up to the monthly ceiling
Maternity leave
  • 120 days of paid leave
  • Employers pay the leave and deduct it from social security contributions
  • Empresa Cidadã program allows an extension to 180 days
Paternity leave
  • 5 days of paid leave
  • Can be extended to 20 days if the employer is enrolled in Empresa Cidadã
Annual Leave
  • Employees are entitled to 30 days of paid vacation after 12 months of continuous employment
  • Vacation must be used within 12 months of entitlement
  • Vacation bonus of 1/3 of the monthly salary is mandated by law
11 Public holidays in Brazil

Note: Brazil recognizes national, state, and municipal holidays. Employees are not entitled to paid time off for all unless specified by local law.

1st
New Year's Day
28th
Carnival (regional holiday)
1st
Carnival (regional holiday)
2nd
Carnival (regional holiday)
3rd
Carnival (regional holiday)
4th
Carnival (regional holiday)
18th
Good Friday
21st
Tiradentes Day
1st
Labor Day
19th
Corpus Christi
7th
Independence Day
12th
Our Lady of Aparecida
2nd
All Souls’ Day
15th
Proclamation of the Republic
25th
Christmas Day
  • 1 Jan: Friday, New Year's Day
  • 15 Feb: Monday, Carnival Monday
  • 16 Feb: Tuesday, Carnival Tuesday
  • 17 Feb: Wednesday, Carnival end (until 2pm)
  • 2 Apr: Friday, Good Friday
  • 21 Apr: Wednesday, Tiradentes Day
  • 1 May: Saturday, Labor Day / May Day
  • 3 Jun: Thursday, Corpus Christi
  • 7 Sep: Tuesday, Independence Day
  • 12 Oct: Tuesday, Our Lady of Aparecida / Children's Day
  • 28 Oct: Thursday, Public Service Holiday
  • 2 Nov: Tuesday, All Souls' Day
  • 15 Nov: Monday, Republic Proclamation Day
  • 24 Dec: Friday, Christmas Eve (from 2pm)
  • 25 Dec: Saturday, Christmas Day
  • 31 Dec: Friday, New Year's Eve (from 2pm)

Termination Process

Legal Grounds for Termination

  • Mutual agreement
  • Dismissal with or without cause
  • End of fixed-term contracts
  • Employee resignation

Protected Employees (cannot be dismissed without just cause)

  • Pregnant employees
  • Union leaders
  • Members of the Internal Commission for Accident Prevention (CIPA)

Notice Period

  • Employer-initiated termination:
    • 30 days minimum + 3 days per year of service (max 90 days total)
  • Employee resignation:30 days
  • Mutual agreement:Notice period is cut in half

Severance Pay

  • Varies by type of termination
  • Without cause: Employee is entitled to:
    • Prior notice or pay in lieu
    • 13th salary (pro rata)
    • Vacation + 1/3 bonus
    • FGTS balance + 40% penalty paid by employer
  • Mutual agreement:20% FGTS penalty
  • With cause:Severance rights forfeited

Probation Period

Max 90 days (45 days initially + one 45-day extension)

Personal Details

Name, contact information, and role of the employee.

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Grow Your Team in Brazil
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From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

Building and expanding a global workforce is seamless with RemotePass. Our platform simplifies the complexities of hiring, payroll, and compliance across over 150 countries, including Brazil.

With RemotePass, you can quickly onboard international employees, manage payroll, ensure legal compliance, and provide competitive benefits—all from one place. Focus on growing your business while we handle the HR and legal intricacies.

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Hiring in Brazil | Payroll, Tax & Employment Guide

Brazil combines one of Latin America's largest tech talent pools with time zone alignment for North American and European teams.

RemotePass makes hiring in Brazil simple. We handle compliance, contracts, and payroll so you can focus on building your team.

Key Takeaways for Hiring in Brazil

  • Employment contracts must be bilingual (Portuguese and English) with detailed terms on probation, notice, and compensation
  • Employees receive a mandatory 13th-month salary (Christmas bonus) paid in two installments, typically in November and December
  • FGTS (severance fund) requires 8% employer contribution monthly, with a 40% penalty paid upon termination without cause
  • Vacation pay must be at least one-third higher than regular earnings, and unused vacation after 12 months triggers double pay

Quick Facts For Hiring In Brazil

Continent
South America
Capital
Brasília
Currency
Brazilian Real (BRL, R$)
Language
Portuguese
Payroll Cycle
Monthly
Pay Date
By the 5th of the following month

Brazil Employment Contract Overview

Brazilian employment contracts follow structured rules under the CLT (Consolidação das Leis do Trabalho). Here's what our standard contracts include and the conditions they follow.

Contract Type
Fixed-term (renewable once) / Open-ended
Local Language Required?
Yes
Bilingual?
Portuguese and English
Probation Period
90 days (renewable once)
Minimum Paid Time Off
Up to 30 days depending on unexcused absences (five or fewer absences: 30 days; six to 14 absences: 24 days; 15 to 23 absences: 18 days; 24 to 32 absences: 12 days; over 32 absences: no vacation granted)
Public Holidays
Eight public holidays
Notice Period
30 days minimum. If the employee has been employed for more than one year, the notice period increases by three days for each additional year of service, up to a maximum of 90 days

What Do You Need To Include In A Brazilian Employment Contract?

To stay compliant in Brazil, employment contracts must include these essentials:

Employee Information

  • Full name
  • ID number
  • Role / Job title
  • Start date
  • Contract duration
  • Working hours
  • Probation and notice conditions
  • Termination provisions
  • Compensation details

How Does Payroll and Taxation Work in Brazil?

Brazilian payroll centers around mandatory FGTS contributions, progressive INSS rates, and the 13th-month salary. Here's what you need to know.

Payroll Setup

Salary currency

Brazilian Real (BRL, R$)

Minimum Wage

BRL 1,518

Hours per Week

44 hours per week / eight hours per day

Payroll Frequency

Monthly

Weekdays

Monday through Friday

Mandatory Bonuses

13th-month salary / Christmas bonus. Workers receive a year-end bonus equivalent to one month's wages, split into two parts: the first is paid between February 1 and November 30, and the second must be paid by December 20. Usually, one half is distributed in November and the remaining half in December.

Gross Salary Structure

Gross salary doesn't follow a standardized structure in Brazil.

What Payroll Taxes Do Employers Pay in Brazil?

Employer cost % (estimate):


Employer Cost %

Contributions Breakdown

INSS (Social Security):

20%

Occupational Risk Contribution (RAT):

1% to 3%

Contribution To Third Parties:

5.8%

What Payroll Taxes Do Employees Pay in Brazil?

Individual Income Tax

IRRF (Income Tax) ranges from 0% to 27.5% (progressive rates, after INSS deduction)

Social Contributions


Total:

7.5% to 14% (progressive)

Hiring cost calculator 

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BR
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Top Countries
Employer cost
Total monthly cost of employment
Gross monthly salary costs
Estimated taxes and contributions
Employee cost
Net monthly salary
GBP 5,137
Gross monthly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Employer cost
Total yearly cost of employment
Gross yearly salary costs
Estimated taxes and contributions
Employee cost
Net yearly salary
GBP 5,137
Gross yearly salary
GBP 8,334
Estimated taxes & social security
GBP 8,334
Request a detailed quotation

Mandatory Employee Benefits in Brazil

Employment of expats is supported in Brazil. Individuals from abroad who wish to live or work in Brazil must first secure a temporary visa and submit a residence application within 90 days after arriving. Typically, residence visas are issued for up to two years and can be extended.

Benefits Provider Funded Through Notes
Health Insurance Government

General Tax Revenues

Brazil has a public healthcare system (SUS - Sistema Único de Saúde) that provides free and universal access to healthcare for all people in the country—Brazilians and foreigners alike, regardless of income.

Pension/Social Security Government

Payroll Contributions

Mandatory for all employees (locals and expats under Brazilian labor law, unless exempt due to bilateral agreements). Contributions to INSS fund retirement, disability, maternity leave, and other social benefits. Employer and employee contributions are compulsory.

Other Statutory Benefits Government / Employer

Payroll Contributions / Additional Cost

FGTS (Fundo de Garantia do Tempo de Serviço) acts as a severance fund, accessible in specific situations like dismissal without cause, retirement, or serious illness. 13th-month salary / Christmas bonus is mandatory: one month's wages split into two parts, typically paid in November and December.

Leave and Holiday Entitlement in Brazil

Annual leave

Employees can receive up to 30 days of paid vacation each year, with the total depending on the number of unexcused absences during that period:

Unexcused Absences Vacation Days
Five or fewer

30 days

Six to 14

24 days

15 to 23

18 days

24 to 32

12 days

Over 32

No vacation granted

Employees become eligible for annual leave after completing 12 months of service with their employer. Vacation pay must be at least one-third higher than the employee's regular earnings. Employers must ensure that vacation is granted within 12 months of when it's earned; otherwise, the employee is entitled to receive double their usual pay when they take the leave. An employee can choose to receive a cash payout instead of using up to one-third of their vacation days. Annual leave cannot be carried over into the next year.

While employers can decide when vacation is taken, it's most often scheduled in coordination with the employee. The leave can be divided into up to three parts, if the employee agrees. One segment must last at least 14 consecutive days, and the other two must each be at least five consecutive days. Employers are required to document vacation periods in the employee's personnel records.

Public holidays

Employees are granted eight nationwide public holidays:

  • January 1: New Year's Day

  • April 21: Tiradentes Day

  • May 1: Labor Day

  • September 7: Independence Day

  • October 12: Our Lady of Aparecida Day

  • November 2: All Souls' Day

  • November 15: Proclamation of the Republic Day

  • December 25: Christmas Day

In addition to national holidays, employees may be entitled to local or regional holidays based on their place of work. Public holidays also include general and state elections, which take place on the first and last Sundays of October.

Sick Leave

Employees who are absent due to a non-work-related illness or injury are entitled to receive their full salary from their employer for the first 15 days of leave. If the absence extends beyond that, Social Security takes over payment of the sick leave benefits.

While receiving these benefits, workers may be subject to regular medical evaluations and, if they're unable to return to their previous role, may be required to undergo vocational training for a new position. Employees who have received Social Security sick leave benefits are protected from termination for up to one year after resuming their regular duties.

Maternity Leave

Female workers are entitled to 120 days of paid maternity leave, which can begin up to one month prior to the expected delivery date. An additional two weeks may be granted before or after childbirth if medically necessary for the mother or baby.

The employer initially covers the cost of maternity leave, based on the employee's last full salary or, for those with variable income, the average of the past six months. However, this amount is later reimbursed by the social security system.

Once the employee notifies the employer of her pregnancy, she's protected from dismissal without just cause until five months after giving birth. New mothers are also allowed two daily half-hour breaks for breastfeeding until the child reaches six months of age.

Paternity Leave

Fathers are entitled to five days of paid leave in Brazil.

Other Types of Leave

  • Marriage Leave: Employees in Brazil are entitled to three days of paid leave to get married

  • Bereavement Leave: Employees can take two days of paid leave in case a spouse, parent, child, sibling, or other dependent dies

Termination and Offboarding in Brazil

Terminating employment in Brazil involves detailed procedures around notice, severance, FGTS penalties, and extensive documentation. Here's what you need to know to manage terminations compliantly.

Type Possible?
Termination for Cause (poor performance, misconduct, etc.) Yes
Termination without Cause Yes
Mutual Termination Agreement (MTA) Yes
Redundancy Not possible under the EOR setup

Employee Resignations

Employee
Resignations

 Termination with Cause

Termination
with Cause

Termination without Cause

Termination
without Cause

Mutual Termination Agreement

Mutual Termination
Agreement

 Fixed Term Contract

Fixed Term
Contract

Brazil Employee Resignation

Notice

Form

Written notice is required. The employee must submit a resignation letter (carta de demissão) stating their intention to leave and the effective date. It must be signed and dated by the employee, and ideally counter-signed by the employer as acknowledgment.

Notice period

The employee must give at least 30 days' notice (CLT, Article 487, §2º). The notice period starts from the date of communication (submission of resignation letter).

Payment in lieu of notice or notice waiver

You may choose to waive the notice period, allowing the employee to leave immediately. If the employee doesn't work the notice period, you can deduct up to 30 days' salary from the final paycheck. Conversely, you cannot deduct anything if you waive the notice.

End-of-Service Benefits

Severance/Gratuity

In a resignation (voluntary termination by the employee), the worker isn't entitled to the full severance that applies to dismissal without cause.

Other Benefits

  • Balance of salary (days worked in the final month)

  • Proportional 13th salary (based on months worked in the year)

  • Accrued vacation + ⅓ bonus

  • Proportional vacation + ⅓ bonus

  • FGTS balance can remain in the account, but no right to withdraw FGTS funds and no 40% FGTS fine

Note: In resignations, the 40% FGTS penalty and unemployment insurance are not paid.

Termination Documentation

Upon resignation, you must provide:

  • Termo de Rescisão do Contrato de Trabalho (TRCT) – Official employment termination form

  • Payment receipts – Detailing all end-of-service calculations (vacation, 13th salary, deductions, etc.)

  • CTPS (Carteira de Trabalho e Previdência Social) – Must be updated (electronically or physically) with the termination date

  • FGTS statement – Showing deposits up to the termination date

  • Payslip (holerite) – For the final payment

  • Communication of Termination (Comunicação de Dispensa) – For statistical and government control purposes

Employer Termination With Cause in Brazil

Acceptable grounds

An employee may be dismissed for just cause under the following circumstances:

  • Engaging in dishonesty or other forms of misconduct

  • Performing outside work without the employer's consent that interferes with job duties or breaches loyalty

  • Being convicted of a crime that leads to imprisonment

  • Performing job duties with negligence, carelessness, or disregard

  • Being regularly intoxicated while at work

  • Breaching employer-imposed confidentiality rules

  • Showing insubordination

  • Being absent without authorization, typically for 30 days or more

  • Frequently participating in gambling activities at the workplace

  • Damaging the reputation or causing physical harm to coworkers, supervisors, or the employer, except in self-defense or defense of others

  • Committing acts that threaten national security, as determined through administrative investigation

  • Engaging in abusive conduct during a strike

  • Unjustifiably refusing to comply with occupational health and safety regulations

  • For banking employees, consistently failing to meet legal debt obligations when due

Notice

Termination for just cause doesn't require prior notice.

End-of-Service Benefits

Severance

Not applicable for just cause dismissals.

Other Benefits

  • Salary balance

  • Accrued unused vacation

Employees dismissed for just cause are not eligible for prorated vacation pay or the year-end bonus.

Termination Documentation

  • Termination Letter (Carta de Dispensa por Justa Causa): A formal letter specifying the legal reason for dismissal (based on one of the grounds listed in CLT, Article 482). Must be clear, specific, and dated. The misconduct must be described objectively. Serves as formal communication to the employee.

  • TRCT (Termo de Rescisão do Contrato de Trabalho): Standard termination form required by the Ministry of Labor. Must indicate that the termination is for just cause. Summarizes payment of accrued entitlements (e.g., final salary, accrued vacation). Required for all types of terminations.

  • Payslip for Final Payment (Holerite de Rescisão): Itemized statement of days worked, accrued vacation (if any), any deductions (e.g., salary advances, INSS), and any other legal earnings

  • Updated CTPS (Carteira de Trabalho e Previdência Social): You must update the termination date in the employee's digital or physical work card (CTPS). The reason for dismissal isn't legally required to appear in the CTPS—only the termination date and type of contract.

  • FGTS Statement (Extrato do FGTS): Statement of deposits made up to the date of termination. Even though the employee cannot withdraw the FGTS, this document proves compliance by the employer.

  • INSS Payment Guide (Guia de Recolhimento do FGTS e Informações à Previdência Social - GFIP): Shows that you submitted information to the Social Security system and paid the required contributions up to the termination date

Employer Termination Without Cause in Brazil

Notice

Form

You must deliver a written notice of dismissal to the employee. The notice must be dated and signed, clearly state that the termination is without cause (sem justa causa), and indicate the start date of the notice period or specify whether you'll provide pay in lieu of notice.

Notice period

  • For employees paid weekly or more frequently: eight days' notice is required

  • For those paid less often or who have been with the company for at least one year: a minimum of 30 days' notice is necessary, with an additional three days added for each year of service, up to a maximum of 90 days

During the notice period, employees are allowed up to two hours of paid leave each day. Alternatively, employees paid weekly or more frequently may take one full paid day off, while those paid less frequently or with at least one year of service can take seven full paid days off.

Payment in lieu of notice or notice waiver: If you fail to provide the required notice, the employee must be compensated with their regular salary for the entire notice period.

End-of-Service Benefits

Severance

When an employee is dismissed without just cause, you're required to pay a fine equal to 40% of the total amount accumulated in the employee's Guaranteed Fund for Length of Service (FGTS) account during their employment.

Other Benefits

  • All unpaid wages owed

  • Accrued vacation + ⅓ bonus

  • Proportional vacation + ⅓ bonus

  • FGTS withdrawal

Termination Documentation

  • Termination Letter (Carta de Dispensa Sem Justa Causa): Formal communication stating that the contract is being terminated without cause, including the termination date and whether the notice is worked or indemnified.

  • TRCT (Termo de Rescisão do Contrato de Trabalho): Official termination form indicating the type of dismissal (without cause) and all amounts due, such as salary balance, 13th salary, vacation, and FGTS. Must be signed by both employer and employee.

  • TRCT Payment Receipt (Termo de Quitação): Document signed by the employee acknowledging receipt of final payments. Although not mandatory, it is common practice.

  • CTPS Update (Carteira de Trabalho e Previdência Social): Registration of the termination date in the employee’s digital CTPS (via eSocial) or physical CTPS, if applicable.

  • FGTS Documents: FGTS payment receipt for the month of dismissal and the GRRF (Guia de Recolhimento Rescisório do FGTS), including the 40% FGTS penalty and any applicable social contribution. The employee is entitled to withdraw the FGTS balance.

  • Unemployment Insurance Form (Requerimento do Seguro-Desemprego): Official form provided to eligible employees so they can apply for unemployment insurance.

  • Payslip for Final Payment (Holerite de Rescisão): Payslip detailing the breakdown of all final amounts paid to the employee.

Mutual Termination Agreements in Brazil

Mutual Termination Agreements in Brazil are also known as Distrato por Acordo entre as Partes.

Notice

Form

Must be done through a written mutual agreement, signed by both parties (employee and employer). The agreement must clearly state that the contract is being terminated by mutual consent under CLT Article 484-A. Can be structured as an annex to the TRCT or as a standalone document. Electronic signatures are accepted if legally compliant.

Notice period

The law permits payment of half (50%) of the notice period value. The notice can be worked (employee serves half the notice period) or indemnified (employer pays half the notice period in cash). The 30-day minimum notice rule still applies, but only half is required in this type of termination.

Waiver of notice

By mutual agreement, the notice period can be waived, but no payment is due in that case. Alternatively, the parties may agree to pay in lieu of notice, but only half the value is required.

End-of-Service Benefits

Under CLT Article 484-A, mutual termination (Distrato por Acordo) allows both you and the employee to end the contract by agreement, with reduced financial obligations compared to a termination without cause.

Severance

The severance and benefits paid in this case are partially reduced:

  • Salary balance: Payment for days worked up to the termination date

  • Proportional 13th salary: Calculated based on the number of months worked during the year

  • Proportional vacation: Includes the 1/3 constitutional vacation bonus

  • Accrued vacation plus 1/3 constitutional bonus

  • Prior notice: Payment in lieu of notice is acceptable

  • FGTS penalty (fine): Normally 40% in a dismissal without cause; reduced to 20% in this case

  • FGTS withdrawal: Employee may withdraw up to 80% of the FGTS balance

Termination Documentation

  • Mutual Termination Agreement (Distrato por Acordo): Written agreement referencing CLT Article 484-A, signed by both parties, specifying the termination date and financial terms

  • TRCT (Termo de Rescisão do Contrato de Trabalho): Must indicate the termination as “Rescisão por Acordo entre as Partes” and show all calculated payments and deductions

  • Termination Payment Receipt: Itemized final payslip (holerite de rescisão) showing all amounts paid

  • CTPS Update: Termination recorded in the employee’s digital CTPS (via eSocial) or physical work card, if still in use

  • FGTS Documentation: GRRF (Guia de Recolhimento Rescisório do FGTS) showing the 20% FGTS fine and authorization for the employee to withdraw up to 80% of the FGTS balance

Offboarding Process for the End of Fixed-term Contracts in Brazil

If the Fixed-Term Contract Ends Normally

A fixed-term employment contract typically ends upon the expiration of its agreed duration. In such cases, you must provide the same end-of-service benefits as in a resignation scenario (proportional 13th salary, accrued vacation + ⅓ bonus, proportional vacation + ⅓ bonus), but no severance or FGTS penalty applies.

If the Employer Terminates Early

If you terminate a fixed-term contract before its scheduled expiration without just cause, you must compensate the employee for the full remaining term of the contract, plus all end-of-service benefits including the 40% FGTS penalty and unemployment insurance eligibility.

Final Payment Timing & Immigration and Visa Compliance in Brazil

Final Payment Timing and Compliance

Final Payment Deadline: According to Article 477, §6 of the CLT, the deadline for final payment depends on the type of notice:

  • With notice worked: Deadline for payment is first business day after the end of the notice period
  • With indemnified notice: Deadline for payment is up to 10 calendar days from the termination date

Penalty: As per CLT Article 477, §8, if you fail to make final payment within the deadline, you must pay a fine equivalent to one month's salary of the employee.

Visa and Immigration Compliance

For termination of foreign employees (expats) working in Brazil under a valid work visa, you must:

  • Notify the Ministry of Justice and Public Security and the Federal Police, depending on the visa type

  • Update eSocial and SEF/Migrante: The termination must be reported in the eSocial system and, when applicable, in the Migrante platform

  • Ensure the employment contract matches the visa type

  • For certain visa types (e.g., VITEM V), the employer may be liable for repatriation costs

  • Upon termination, the visa and/or work authorization may be cancelled or may require modification

Key Elements of an Employment Contract in Brazil
When drafting an employment contract for employees in Brazil, the following key elements should be included:

Personal Details

Name, contact information, and role of the employee.

_'s Booming Remote Workforce

Challenges of Remote Hiring in _

Simplifying Remote Hiring in _ with RemotePass 

Grow Your Team in Brazil, Compliantly

From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

Building and expanding a global workforce is seamless with RemotePass. Our platform simplifies the complexities of hiring, payroll, and compliance across over 150 countries, including Brazil.

With RemotePass, you can quickly onboard international employees, manage payroll, ensure legal compliance, and provide competitive benefits—all from one place. Focus on growing your business while we handle the HR and legal intricacies.

FAQs About Hiring in Brazil

Got Questions? Find Answers Here

How does the FGTS system work?

FGTS (Fundo de Garantia do Tempo de Serviço) is a mandatory severance fund. You contribute 8% of the employee's monthly salary to their FGTS account. When you terminate without cause, you pay an additional 40% penalty on the total accumulated balance, and the employee can withdraw their full FGTS balance. In resignations, the employee can't access the funds and you don't pay the penalty.

The 13th-month salary has two payment dates?

Yes. The first installment must be paid between February 1 and November 30 (usually paid in November). The second installment must be paid by December 20. It's equivalent to one month's wages split into two payments.

Vacation pay is one-third higher than regular pay?

Correct. Vacation pay must include a constitutional bonus of one-third (⅓) above the employee's regular earnings. So if someone earns BRL 3,000/month, their vacation pay is BRL 4,000 (3,000 + 1,000).

What happens if I don't grant vacation within 12 months?

You must pay double the usual vacation pay when the employee finally takes it. This is a penalty for not granting earned vacation within the required timeframe. Vacation cannot be carried over to the next year.

Can employees really sell back vacation days?

Yes. Employees can choose to receive cash payment instead of using up to one-third of their vacation days. So for 30 days of earned vacation, they can sell back 10 days and take 20 days off.

Notice periods increase with tenure. How does that work?

For terminations without cause: start at 30 days minimum, then add three days for each year of service beyond the first year, capping at 90 days. So someone with five years tenure gets 42 days' notice (30 + 12). For resignations, it's flat 30 days regardless of tenure.

Sick leave protection for a full year after returning?

Yes. If an employee receives Social Security sick leave benefits (which kick in after 15 days), they're protected from termination for up to one year after resuming work. This prevents employers from firing people immediately after they return from extended illness.

Why are there so many termination documents?

Brazilian labor law is documentation-heavy to protect employee rights. The TRCT, CTPS update, FGTS statements, and various receipts all serve as official proof of proper termination and payment. Missing any of these can result in labor disputes or fines.

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Brazil

Brazil is the largest country in South America and the fifth-largest in the world by both area and population. It shares borders with every South American country except Chile and Ecuador. Home to the Christ the Redeemer statue—one of the Seven Wonders of the Modern World—Brazil is a culturally rich and economically diverse country. As a top emerging market, Brazil offers substantial growth opportunities for global businesses, especially those prepared to navigate its complex labor laws and tax system.
Contractor Management
EOR
Payroll
Contractor of Record
العملة
Brazilian real (BRL)
تردد الرواتب
Fortnightly or monthly
ضرائب أصحاب العمل
28.00% to 30.50%

نظرة عامة

التركيبة السكانية
210+ million
اللغة
Portuguese
العاصمة
Brasilia
العملة
Brazilian real (BRL)
رمز الاتصال الدولي
+55
الحد الأدنى للأجور
R$1,320/month (as of 2025; varies by state and sector)
ساعات العمل
8 AM - 5 PM
أيام الأسبوع
Monday to Friday
ساعات العمل اسبوعيا
44

الرواتب

الموظفون برواتب ثابتة
Monthly, typically paid on the 5th business day of the following month
الموظفون بنظام الأجر الزمني
13th Salary

Mandatory annual bonus equivalent to one month’s salary, paid in two installments (November and December)

متوسط ​​ضريبة صاحب العمل

28.00% to 30.50% of gross salary

تحصيل الضرائب

INSS (Social Security)
20%–22.5%
FGTS (Severance Fund)
8%
Other taxes
may apply based on company activity or sector

ضريبة القيمة المضافة

ضريبة القيمة المضافة

Standard rate of 17%

حساب الضريبة في Brazil
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BR
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Top Countries
تكلفة صاحب العمل
إجمالي تكلفة التوظيف الشهرية
إجمالي تكاليف الراتب الشهري
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب الشهري

GBP 5,137
الراتب الشهري الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
تكلفة صاحب العمل
إجمالي تكلفة التوظيف السنوية
إجمالي تكاليف الرواتب السنوية
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب السنوي

GBP 5,137
الراتب السنوي الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
اطلب عرض أسعار تفصيلي
كيف تعمل الخدمة

عملية الانضمام

تشمل عملية التوظيف في Brazil عادة الخطوات التالية لضمان انتقال سلس للموظفين الجدد:

Employment Contract

  • Must be in Portuguese and detail salary, working hours, benefits, job duties, leave, and termination terms
  • Should clearly define probation period and notice clauses

Document Collection

  • CPF (Taxpayer Number)
  • RG or National ID
  • CTPS (Work and Social Security Card)
  • Proof of address and education (if applicable)

Labor and Tax Registration

  • Register the employee with:
    • eSocial (digital labor obligations system)
    • INSS (social security)
    • FGTS (severance fund)
    • Caixa Econômica Federal for FGTS account

Benefits Enrollment

  • Register employee for:
    • Mandatory programs: social security, FGTS
    • Optional: healthcare, meal/transport vouchers, dental insurance

Orientation and Training

  • Provide an employee handbook detailing:
    • Company culture and policies
    • Health and safety regulations
    • Ethical code of conduct

Probation Review

Evaluate performance before the end of the probationary period to determine continuation, adjustment, or dismissal

Pre-boarding

Pre-boarding

Pre-boarding

العناصر الأساسية في عقد العمل في Brazil
عند إعداد عقد عمل للموظفين في Brazil يجب تضمين العناصر الأساسية التالية:

Personal Details

Name, contact information, and role of the employee.

سياسات إجازات الموظفين

الإجازات المرضية
  • The employer pays 100% of wages for the first 15 days
  • From the 16th day onward, the INSS covers medical leave up to the monthly ceiling
إجازة الأمومة
  • 120 days of paid leave
  • Employers pay the leave and deduct it from social security contributions
  • Empresa Cidadã program allows an extension to 180 days
إجازة الأبوة
  • 5 days of paid leave
  • Can be extended to 20 days if the employer is enrolled in Empresa Cidadã
الإجازة السنوية
  • Employees are entitled to 30 days of paid vacation after 12 months of continuous employment
  • Vacation must be used within 12 months of entitlement
  • Vacation bonus of 1/3 of the monthly salary is mandated by law
11 عطلات رسمية في Brazil

Note: Brazil recognizes national, state, and municipal holidays. Employees are not entitled to paid time off for all unless specified by local law.

1st
New Year's Day
28th
Carnival (regional holiday)
1st
Carnival (regional holiday)
2nd
Carnival (regional holiday)
3rd
Carnival (regional holiday)
4th
Carnival (regional holiday)
18th
Good Friday
21st
Tiradentes Day
1st
Labor Day
19th
Corpus Christi
7th
Independence Day
12th
Our Lady of Aparecida
2nd
All Souls’ Day
15th
Proclamation of the Republic
25th
Christmas Day
  • 1 Jan: Friday, New Year's Day
  • 15 Feb: Monday, Carnival Monday
  • 16 Feb: Tuesday, Carnival Tuesday
  • 17 Feb: Wednesday, Carnival end (until 2pm)
  • 2 Apr: Friday, Good Friday
  • 21 Apr: Wednesday, Tiradentes Day
  • 1 May: Saturday, Labor Day / May Day
  • 3 Jun: Thursday, Corpus Christi
  • 7 Sep: Tuesday, Independence Day
  • 12 Oct: Tuesday, Our Lady of Aparecida / Children's Day
  • 28 Oct: Thursday, Public Service Holiday
  • 2 Nov: Tuesday, All Souls' Day
  • 15 Nov: Monday, Republic Proclamation Day
  • 24 Dec: Friday, Christmas Eve (from 2pm)
  • 25 Dec: Saturday, Christmas Day
  • 31 Dec: Friday, New Year's Eve (from 2pm)

عملية إنهاء العقود

Legal Grounds for Termination

  • Mutual agreement
  • Dismissal with or without cause
  • End of fixed-term contracts
  • Employee resignation

Protected Employees (cannot be dismissed without just cause)

  • Pregnant employees
  • Union leaders
  • Members of the Internal Commission for Accident Prevention (CIPA)

Notice Period

  • Employer-initiated termination:
    • 30 days minimum + 3 days per year of service (max 90 days total)
  • Employee resignation:30 days
  • Mutual agreement:Notice period is cut in half

Severance Pay

  • Varies by type of termination
  • Without cause: Employee is entitled to:
    • Prior notice or pay in lieu
    • 13th salary (pro rata)
    • Vacation + 1/3 bonus
    • FGTS balance + 40% penalty paid by employer
  • Mutual agreement:20% FGTS penalty
  • With cause:Severance rights forfeited

Probation Period

Max 90 days (45 days initially + one 45-day extension)

Personal Details

Name, contact information, and role of the employee.

نمو سوق العمل عن بُعد _  

تحديات التوظيف عن بُعد في  _

تبسيط التوظيف عن بُعد في _ مع ريموت باس

نمِّ فريقك في Brazil
مع ريموت باس

From onboarding and payroll to offboarding and visa support, RemotePass simplifies it all so you can focus on growing your team.

يصبح بناء فريق عالمي وتوسيعه مهمة سهلة مع ريموت باس. منصتنا تبسّط تعقيدات التوظيف والرواتب والامتثال القانوني في أكثر من 150 دولة، بما في ذلك Brazil.

مع ريموت باس، يمكنك ضم الموظفين الدوليين بسرعة، وإدارة الرواتب، وضمان الامتثال القانوني، وتقديم مزايا تنافسية — كل ذلك من مكان واحد. ركّز على تنمية أعمالك، ودع المهام الإدارية والقانونية علينا.

تجربة مجانية لمدة 7 أيام

لا حاجة لبطاقة ائتمان

يمكنك الإلغاء في أي وقت

Hiring in Brazil | Payroll, Tax & Employment Guide

Brazil combines one of Latin America's largest tech talent pools with time zone alignment for North American and European teams.

RemotePass makes hiring in Brazil simple. We handle compliance, contracts, and payroll so you can focus on building your team.

Key Takeaways for Hiring in Brazil

  • Employment contracts must be bilingual (Portuguese and English) with detailed terms on probation, notice, and compensation
  • Employees receive a mandatory 13th-month salary (Christmas bonus) paid in two installments, typically in November and December
  • FGTS (severance fund) requires 8% employer contribution monthly, with a 40% penalty paid upon termination without cause
  • Vacation pay must be at least one-third higher than regular earnings, and unused vacation after 12 months triggers double pay

Quick Facts For Hiring In Brazil

Continent
South America
Capital
Brasília
Currency
Brazilian Real (BRL, R$)
Language
Portuguese
Payroll Cycle
Monthly
Pay Date
By the 5th of the following month

Brazil Employment Contract Overview

Brazilian employment contracts follow structured rules under the CLT (Consolidação das Leis do Trabalho). Here's what our standard contracts include and the conditions they follow.

Contract Type
Fixed-term (renewable once) / Open-ended
Local Language Required?
Yes
Bilingual?
Portuguese and English
Probation Period
90 days (renewable once)
Minimum Paid Time Off
Up to 30 days depending on unexcused absences (five or fewer absences: 30 days; six to 14 absences: 24 days; 15 to 23 absences: 18 days; 24 to 32 absences: 12 days; over 32 absences: no vacation granted)
Public Holidays
Eight public holidays
Notice Period
30 days minimum. If the employee has been employed for more than one year, the notice period increases by three days for each additional year of service, up to a maximum of 90 days

What Do You Need To Include In A Brazilian Employment Contract?

To stay compliant in Brazil, employment contracts must include these essentials:

Employee Information

  • Full name
  • ID number
  • Role / Job title
  • Start date
  • Contract duration
  • Working hours
  • Probation and notice conditions
  • Termination provisions
  • Compensation details

How Does Payroll and Taxation Work in Brazil?

Brazilian payroll centers around mandatory FGTS contributions, progressive INSS rates, and the 13th-month salary. Here's what you need to know.

Payroll Setup

Salary currency

Brazilian Real (BRL, R$)

Minimum Wage

BRL 1,518

Hours per Week

44 hours per week / eight hours per day

Payroll Frequency

Monthly

Weekdays

Monday through Friday

Mandatory Bonuses

13th-month salary / Christmas bonus. Workers receive a year-end bonus equivalent to one month's wages, split into two parts: the first is paid between February 1 and November 30, and the second must be paid by December 20. Usually, one half is distributed in November and the remaining half in December.

Gross Salary Structure

Gross salary doesn't follow a standardized structure in Brazil.

What Payroll Taxes Do Employers Pay in Brazil?

Employer cost % (estimate):


Employer Cost %

Contributions Breakdown

INSS (Social Security):

20%

Occupational Risk Contribution (RAT):

1% to 3%

Contribution To Third Parties:

5.8%

What Payroll Taxes Do Employees Pay in Brazil?

Individual Income Tax

IRRF (Income Tax) ranges from 0% to 27.5% (progressive rates, after INSS deduction)

Social Contributions


Total:

7.5% to 14% (progressive)

حاسبة تكلفة التوظيف

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Top Countries
تكلفة صاحب العمل
إجمالي تكلفة التوظيف الشهرية
إجمالي تكاليف الراتب الشهري
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب الشهري

GBP 5,137
الراتب الشهري الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
تكلفة صاحب العمل
إجمالي تكلفة التوظيف السنوية
إجمالي تكاليف الرواتب السنوية
الضرائب والمساهمات المقدرة
تكلفة الموظف
صافي الراتب السنوي

GBP 5,137
الراتب السنوي الإجمالي
GBP 8,334
الضرائب المقدرة والضمان الاجتماعي
GBP 8,334
اطلب عرض أسعار تفصيلي

Mandatory Employee Benefits in Brazil

Employment of expats is supported in Brazil. Individuals from abroad who wish to live or work in Brazil must first secure a temporary visa and submit a residence application within 90 days after arriving. Typically, residence visas are issued for up to two years and can be extended.

Benefits Provider Funded Through Notes
Health Insurance Government

General Tax Revenues

Brazil has a public healthcare system (SUS - Sistema Único de Saúde) that provides free and universal access to healthcare for all people in the country—Brazilians and foreigners alike, regardless of income.

Pension/Social Security Government

Payroll Contributions

Mandatory for all employees (locals and expats under Brazilian labor law, unless exempt due to bilateral agreements). Contributions to INSS fund retirement, disability, maternity leave, and other social benefits. Employer and employee contributions are compulsory.

Other Statutory Benefits Government / Employer

Payroll Contributions / Additional Cost

FGTS (Fundo de Garantia do Tempo de Serviço) acts as a severance fund, accessible in specific situations like dismissal without cause, retirement, or serious illness. 13th-month salary / Christmas bonus is mandatory: one month's wages split into two parts, typically paid in November and December.

Leave and Holiday Entitlement in Brazil

Annual leave

Employees can receive up to 30 days of paid vacation each year, with the total depending on the number of unexcused absences during that period:

Unexcused Absences Vacation Days
Five or fewer

30 days

Six to 14

24 days

15 to 23

18 days

24 to 32

12 days

Over 32

No vacation granted

Employees become eligible for annual leave after completing 12 months of service with their employer. Vacation pay must be at least one-third higher than the employee's regular earnings. Employers must ensure that vacation is granted within 12 months of when it's earned; otherwise, the employee is entitled to receive double their usual pay when they take the leave. An employee can choose to receive a cash payout instead of using up to one-third of their vacation days. Annual leave cannot be carried over into the next year.

While employers can decide when vacation is taken, it's most often scheduled in coordination with the employee. The leave can be divided into up to three parts, if the employee agrees. One segment must last at least 14 consecutive days, and the other two must each be at least five consecutive days. Employers are required to document vacation periods in the employee's personnel records.

Public holidays

Employees are granted eight nationwide public holidays:

  • January 1: New Year's Day

  • April 21: Tiradentes Day

  • May 1: Labor Day

  • September 7: Independence Day

  • October 12: Our Lady of Aparecida Day

  • November 2: All Souls' Day

  • November 15: Proclamation of the Republic Day

  • December 25: Christmas Day

In addition to national holidays, employees may be entitled to local or regional holidays based on their place of work. Public holidays also include general and state elections, which take place on the first and last Sundays of October.

Sick Leave

Employees who are absent due to a non-work-related illness or injury are entitled to receive their full salary from their employer for the first 15 days of leave. If the absence extends beyond that, Social Security takes over payment of the sick leave benefits.

While receiving these benefits, workers may be subject to regular medical evaluations and, if they're unable to return to their previous role, may be required to undergo vocational training for a new position. Employees who have received Social Security sick leave benefits are protected from termination for up to one year after resuming their regular duties.

Maternity Leave

Female workers are entitled to 120 days of paid maternity leave, which can begin up to one month prior to the expected delivery date. An additional two weeks may be granted before or after childbirth if medically necessary for the mother or baby.

The employer initially covers the cost of maternity leave, based on the employee's last full salary or, for those with variable income, the average of the past six months. However, this amount is later reimbursed by the social security system.

Once the employee notifies the employer of her pregnancy, she's protected from dismissal without just cause until five months after giving birth. New mothers are also allowed two daily half-hour breaks for breastfeeding until the child reaches six months of age.

Paternity Leave

Fathers are entitled to five days of paid leave in Brazil.

Other Types of Leave

  • Marriage Leave: Employees in Brazil are entitled to three days of paid leave to get married

  • Bereavement Leave: Employees can take two days of paid leave in case a spouse, parent, child, sibling, or other dependent dies

Termination and Offboarding in Brazil

Terminating employment in Brazil involves detailed procedures around notice, severance, FGTS penalties, and extensive documentation. Here's what you need to know to manage terminations compliantly.

Type Possible?
Termination for Cause (poor performance, misconduct, etc.) Yes
Termination without Cause Yes
Mutual Termination Agreement (MTA) Yes
Redundancy Not possible under the EOR setup

Employee Resignations

Employee
Resignations

 Termination with Cause

Termination
with Cause

Termination without Cause

Termination
without Cause

Mutual Termination Agreement

Mutual Termination
Agreement

 Fixed Term Contract

Fixed Term
Contract

Brazil Employee Resignation

Notice

Form

Written notice is required. The employee must submit a resignation letter (carta de demissão) stating their intention to leave and the effective date. It must be signed and dated by the employee, and ideally counter-signed by the employer as acknowledgment.

Notice period

The employee must give at least 30 days' notice (CLT, Article 487, §2º). The notice period starts from the date of communication (submission of resignation letter).

Payment in lieu of notice or notice waiver

You may choose to waive the notice period, allowing the employee to leave immediately. If the employee doesn't work the notice period, you can deduct up to 30 days' salary from the final paycheck. Conversely, you cannot deduct anything if you waive the notice.

End-of-Service Benefits

Severance/Gratuity

In a resignation (voluntary termination by the employee), the worker isn't entitled to the full severance that applies to dismissal without cause.

Other Benefits

  • Balance of salary (days worked in the final month)

  • Proportional 13th salary (based on months worked in the year)

  • Accrued vacation + ⅓ bonus

  • Proportional vacation + ⅓ bonus

  • FGTS balance can remain in the account, but no right to withdraw FGTS funds and no 40% FGTS fine

Note: In resignations, the 40% FGTS penalty and unemployment insurance are not paid.

Termination Documentation

Upon resignation, you must provide:

  • Termo de Rescisão do Contrato de Trabalho (TRCT) – Official employment termination form

  • Payment receipts – Detailing all end-of-service calculations (vacation, 13th salary, deductions, etc.)

  • CTPS (Carteira de Trabalho e Previdência Social) – Must be updated (electronically or physically) with the termination date

  • FGTS statement – Showing deposits up to the termination date

  • Payslip (holerite) – For the final payment

  • Communication of Termination (Comunicação de Dispensa) – For statistical and government control purposes

Employer Termination With Cause in Brazil

Acceptable grounds

An employee may be dismissed for just cause under the following circumstances:

  • Engaging in dishonesty or other forms of misconduct

  • Performing outside work without the employer's consent that interferes with job duties or breaches loyalty

  • Being convicted of a crime that leads to imprisonment

  • Performing job duties with negligence, carelessness, or disregard

  • Being regularly intoxicated while at work

  • Breaching employer-imposed confidentiality rules

  • Showing insubordination

  • Being absent without authorization, typically for 30 days or more

  • Frequently participating in gambling activities at the workplace

  • Damaging the reputation or causing physical harm to coworkers, supervisors, or the employer, except in self-defense or defense of others

  • Committing acts that threaten national security, as determined through administrative investigation

  • Engaging in abusive conduct during a strike

  • Unjustifiably refusing to comply with occupational health and safety regulations

  • For banking employees, consistently failing to meet legal debt obligations when due

Notice

Termination for just cause doesn't require prior notice.

End-of-Service Benefits

Severance

Not applicable for just cause dismissals.

Other Benefits

  • Salary balance

  • Accrued unused vacation

Employees dismissed for just cause are not eligible for prorated vacation pay or the year-end bonus.

Termination Documentation

  • Termination Letter (Carta de Dispensa por Justa Causa): A formal letter specifying the legal reason for dismissal (based on one of the grounds listed in CLT, Article 482). Must be clear, specific, and dated. The misconduct must be described objectively. Serves as formal communication to the employee.

  • TRCT (Termo de Rescisão do Contrato de Trabalho): Standard termination form required by the Ministry of Labor. Must indicate that the termination is for just cause. Summarizes payment of accrued entitlements (e.g., final salary, accrued vacation). Required for all types of terminations.

  • Payslip for Final Payment (Holerite de Rescisão): Itemized statement of days worked, accrued vacation (if any), any deductions (e.g., salary advances, INSS), and any other legal earnings

  • Updated CTPS (Carteira de Trabalho e Previdência Social): You must update the termination date in the employee's digital or physical work card (CTPS). The reason for dismissal isn't legally required to appear in the CTPS—only the termination date and type of contract.

  • FGTS Statement (Extrato do FGTS): Statement of deposits made up to the date of termination. Even though the employee cannot withdraw the FGTS, this document proves compliance by the employer.

  • INSS Payment Guide (Guia de Recolhimento do FGTS e Informações à Previdência Social - GFIP): Shows that you submitted information to the Social Security system and paid the required contributions up to the termination date

Employer Termination Without Cause in Brazil

Notice

Form

You must deliver a written notice of dismissal to the employee. The notice must be dated and signed, clearly state that the termination is without cause (sem justa causa), and indicate the start date of the notice period or specify whether you'll provide pay in lieu of notice.

Notice period

  • For employees paid weekly or more frequently: eight days' notice is required

  • For those paid less often or who have been with the company for at least one year: a minimum of 30 days' notice is necessary, with an additional three days added for each year of service, up to a maximum of 90 days

During the notice period, employees are allowed up to two hours of paid leave each day. Alternatively, employees paid weekly or more frequently may take one full paid day off, while those paid less frequently or with at least one year of service can take seven full paid days off.

Payment in lieu of notice or notice waiver: If you fail to provide the required notice, the employee must be compensated with their regular salary for the entire notice period.

End-of-Service Benefits

Severance

When an employee is dismissed without just cause, you're required to pay a fine equal to 40% of the total amount accumulated in the employee's Guaranteed Fund for Length of Service (FGTS) account during their employment.

Other Benefits

  • All unpaid wages owed

  • Accrued vacation + ⅓ bonus

  • Proportional vacation + ⅓ bonus

  • FGTS withdrawal

Termination Documentation

  • Termination Letter (Carta de Dispensa Sem Justa Causa): Formal communication stating that the contract is being terminated without cause, including the termination date and whether the notice is worked or indemnified.

  • TRCT (Termo de Rescisão do Contrato de Trabalho): Official termination form indicating the type of dismissal (without cause) and all amounts due, such as salary balance, 13th salary, vacation, and FGTS. Must be signed by both employer and employee.

  • TRCT Payment Receipt (Termo de Quitação): Document signed by the employee acknowledging receipt of final payments. Although not mandatory, it is common practice.

  • CTPS Update (Carteira de Trabalho e Previdência Social): Registration of the termination date in the employee’s digital CTPS (via eSocial) or physical CTPS, if applicable.

  • FGTS Documents: FGTS payment receipt for the month of dismissal and the GRRF (Guia de Recolhimento Rescisório do FGTS), including the 40% FGTS penalty and any applicable social contribution. The employee is entitled to withdraw the FGTS balance.

  • Unemployment Insurance Form (Requerimento do Seguro-Desemprego): Official form provided to eligible employees so they can apply for unemployment insurance.

  • Payslip for Final Payment (Holerite de Rescisão): Payslip detailing the breakdown of all final amounts paid to the employee.

Mutual Termination Agreements in Brazil

Mutual Termination Agreements in Brazil are also known as Distrato por Acordo entre as Partes.

Notice

Form

Must be done through a written mutual agreement, signed by both parties (employee and employer). The agreement must clearly state that the contract is being terminated by mutual consent under CLT Article 484-A. Can be structured as an annex to the TRCT or as a standalone document. Electronic signatures are accepted if legally compliant.

Notice period

The law permits payment of half (50%) of the notice period value. The notice can be worked (employee serves half the notice period) or indemnified (employer pays half the notice period in cash). The 30-day minimum notice rule still applies, but only half is required in this type of termination.

Waiver of notice

By mutual agreement, the notice period can be waived, but no payment is due in that case. Alternatively, the parties may agree to pay in lieu of notice, but only half the value is required.

End-of-Service Benefits

Under CLT Article 484-A, mutual termination (Distrato por Acordo) allows both you and the employee to end the contract by agreement, with reduced financial obligations compared to a termination without cause.

Severance

The severance and benefits paid in this case are partially reduced:

  • Salary balance: Payment for days worked up to the termination date

  • Proportional 13th salary: Calculated based on the number of months worked during the year

  • Proportional vacation: Includes the 1/3 constitutional vacation bonus

  • Accrued vacation plus 1/3 constitutional bonus

  • Prior notice: Payment in lieu of notice is acceptable

  • FGTS penalty (fine): Normally 40% in a dismissal without cause; reduced to 20% in this case

  • FGTS withdrawal: Employee may withdraw up to 80% of the FGTS balance

Termination Documentation

  • Mutual Termination Agreement (Distrato por Acordo): Written agreement referencing CLT Article 484-A, signed by both parties, specifying the termination date and financial terms

  • TRCT (Termo de Rescisão do Contrato de Trabalho): Must indicate the termination as “Rescisão por Acordo entre as Partes” and show all calculated payments and deductions

  • Termination Payment Receipt: Itemized final payslip (holerite de rescisão) showing all amounts paid

  • CTPS Update: Termination recorded in the employee’s digital CTPS (via eSocial) or physical work card, if still in use

  • FGTS Documentation: GRRF (Guia de Recolhimento Rescisório do FGTS) showing the 20% FGTS fine and authorization for the employee to withdraw up to 80% of the FGTS balance

Offboarding Process for the End of Fixed-term Contracts in Brazil

If the Fixed-Term Contract Ends Normally

A fixed-term employment contract typically ends upon the expiration of its agreed duration. In such cases, you must provide the same end-of-service benefits as in a resignation scenario (proportional 13th salary, accrued vacation + ⅓ bonus, proportional vacation + ⅓ bonus), but no severance or FGTS penalty applies.

If the Employer Terminates Early

If you terminate a fixed-term contract before its scheduled expiration without just cause, you must compensate the employee for the full remaining term of the contract, plus all end-of-service benefits including the 40% FGTS penalty and unemployment insurance eligibility.

Final Payment Timing & Immigration and Visa Compliance in Brazil

Final Payment Timing and Compliance

Final Payment Deadline: According to Article 477, §6 of the CLT, the deadline for final payment depends on the type of notice:

  • With notice worked: Deadline for payment is first business day after the end of the notice period
  • With indemnified notice: Deadline for payment is up to 10 calendar days from the termination date

Penalty: As per CLT Article 477, §8, if you fail to make final payment within the deadline, you must pay a fine equivalent to one month's salary of the employee.

Visa and Immigration Compliance

For termination of foreign employees (expats) working in Brazil under a valid work visa, you must:

  • Notify the Ministry of Justice and Public Security and the Federal Police, depending on the visa type

  • Update eSocial and SEF/Migrante: The termination must be reported in the eSocial system and, when applicable, in the Migrante platform

  • Ensure the employment contract matches the visa type

  • For certain visa types (e.g., VITEM V), the employer may be liable for repatriation costs

  • Upon termination, the visa and/or work authorization may be cancelled or may require modification

Key Elements of an Employment Contract in Brazil
When drafting an employment contract for employees in Brazil, the following key elements should be included:

Personal Details

Name, contact information, and role of the employee.

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FAQs About Hiring in Brazil

Got Questions? Find Answers Here

How does the FGTS system work?

FGTS (Fundo de Garantia do Tempo de Serviço) is a mandatory severance fund. You contribute 8% of the employee's monthly salary to their FGTS account. When you terminate without cause, you pay an additional 40% penalty on the total accumulated balance, and the employee can withdraw their full FGTS balance. In resignations, the employee can't access the funds and you don't pay the penalty.

The 13th-month salary has two payment dates?

Yes. The first installment must be paid between February 1 and November 30 (usually paid in November). The second installment must be paid by December 20. It's equivalent to one month's wages split into two payments.

Vacation pay is one-third higher than regular pay?

Correct. Vacation pay must include a constitutional bonus of one-third (⅓) above the employee's regular earnings. So if someone earns BRL 3,000/month, their vacation pay is BRL 4,000 (3,000 + 1,000).

What happens if I don't grant vacation within 12 months?

You must pay double the usual vacation pay when the employee finally takes it. This is a penalty for not granting earned vacation within the required timeframe. Vacation cannot be carried over to the next year.

Can employees really sell back vacation days?

Yes. Employees can choose to receive cash payment instead of using up to one-third of their vacation days. So for 30 days of earned vacation, they can sell back 10 days and take 20 days off.

Notice periods increase with tenure. How does that work?

For terminations without cause: start at 30 days minimum, then add three days for each year of service beyond the first year, capping at 90 days. So someone with five years tenure gets 42 days' notice (30 + 12). For resignations, it's flat 30 days regardless of tenure.

Sick leave protection for a full year after returning?

Yes. If an employee receives Social Security sick leave benefits (which kick in after 15 days), they're protected from termination for up to one year after resuming work. This prevents employers from firing people immediately after they return from extended illness.

Why are there so many termination documents?

Brazilian labor law is documentation-heavy to protect employee rights. The TRCT, CTPS update, FGTS statements, and various receipts all serve as official proof of proper termination and payment. Missing any of these can result in labor disputes or fines.

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