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Coronavirus: Government Analyzes Suspension of Employment Contracts to Avoid Mass Layoffs and Business Closures

Written by Flavia Marinho
Published on 19/03/2020 at 16:26
Coronavírus: Governo analisa suspensão de contratos de trabalho para evitar demissões em massa e fechamento de empresas
Coronavírus: Governo analisa suspensão de contratos de trabalho para evitar demissões em massa e fechamento de empresas
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The Measure Would Be Taken by the Government to Avoid Layoffs and Business Closures Amid the Coronavirus Pandemic. The Suspension of the Contract Could Last Three or Four Months

Due to the crisis caused by the new coronavirus, the Government’s economic team is assessing the possibility of allowing the temporary suspension of employment contracts in the sectors hardest hit by the pandemic. Oil workers threaten to strike, the risk of coronavirus contamination on platforms “is very high,” says FUP.

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The proposal was presented this Wednesday (18) to the team of the Minister of Economy, Paulo Guedes, by Deputy Ricardo Barros (PP-PR), the government’s deputy leader in Congress. “We are awaiting the financial impact of the measure,” Barros said.

The measure could be adopted for sectors most susceptible to the economic crisis, such as restaurants, bars, cinemas, and airlines. The idea, according to the deputy leader of the government, is to provide relief to businesses during the crisis and prevent mass layoffs.

In return, under the proposal, the government’s intention is to pay, during the suspension period of the employment contract, the equivalent of unemployment insurance. The measure would affect formal workers.

The economy technicians are already calculating the cost of the action. Ricardo Barros reminds us that the impact of unemployment insurance is already anticipated in the budget and is a resource that can be used to face the social instability generated by mass layoffs.

According to initial calculations, the suspension of employment contracts could affect around 6 million workers, with a cost of approximately R$ 15 billion to R$ 20 billion.

“Today we estimate that this will have an impact of R$ 15 billion or R$ 20 billion, but it is an account that needs to be settled with the government”, he stated to Congresso em Foco, while heading to the Ministry of Economy. The parliamentarian said that his suggestion has support from deputies with whom he spoke.

For informal workers, the Ministry of Economy is expected to propose granting a voucher with a value similar to that paid by Bolsa Família.

Flavia Marinho

Flavia Marinho is a postgraduate engineer with extensive experience in the onshore and offshore shipbuilding industry. In recent years, she has dedicated herself to writing articles for news websites in the areas of military, security, industry, oil and gas, energy, shipbuilding, geopolitics, jobs, and courses. Contact flaviacamil@gmail.com or WhatsApp +55 21 973996379 for corrections, editorial suggestions, job vacancy postings, or advertising proposals on our portal.

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