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Government Studies Reducing Working Hours to Avoid Unemployment Amid Tariff Hike. Economic Team Also Evaluates Temporarily Suspending FGTS and Social Security Contributions to Alleviate Companies.
The government is studying reducing working hours to avoid unemployment in sectors impacted by the tariff hike imposed by the United States. According to the Minister of Labor and Employment, Luiz Marinho, the measure is part of a set of alternatives aimed at preserving jobs and providing financial relief to companies in crisis.
In addition to reducing working hours, the economic team is considering authorizing the temporary suspension of FGTS and social security contributions, which would reduce immediate costs for entrepreneurs. The proposal was discussed in an interview on the Good Morning, Minister program, from EBC, and is still under evaluation.
What’s at Stake with the Tariff Hike
Last week, the United States raised tariffs on Brazilian products to 50%, significantly impacting key exporting sectors. The impact is already reflected in collective vacations and the risk of layoffs in companies linked to foreign trade.
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The prospector who heard about the advance of soy in Maranhão and opened a grocery store in Balsas in 1986 transformed that small store into Grupo Mateus, the third largest supermarket in Brazil, with revenues of R$ 43.5 billion and 490 units.
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Fiserv, the world’s largest payment processor, has just inaugurated its first factory outside Asia in Brazil. The unit in Betim (MG) will produce 100,000 Clover payment terminals per year and is part of a US$100 million investment that includes technology and expansion until 2027.
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Fiserv, the world’s largest payment processor, has just opened its first factory outside Asia in Brazil. The unit in Betim (MG) will produce 100,000 Clover payment terminals per year and is part of a US$100 million investment that includes technology and expansion until 2027.
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Pix could become a headache between Brazil and the US, and the Lula government will go to the White House to explain the system before pressure mounts.
For the government, the priority is to avoid mass layoffs. The experience from the pandemic, when reducing working hours with salary compensation was implemented, serves as a reference for new emergency measures.
Measures That Can Be Implemented
According to Luiz Marinho, among the alternatives being studied are:
- Postponing FGTS and social security contributions, easing companies’ cash flow;
- Reducing working hours, with the possibility of compensation;
- Resorting to the layoff law, which allows for temporary suspension of contracts;
- Adopting collective vacations as a transitional solution.
These measures would depend on collective agreements and the involvement of unions and labor authorities to ensure that there is no abuse against workers.
Sovereign Brazil Plan and Employment Protection
The government also announced the Sovereign Brazil Plan, which includes the creation of the National Employment Monitoring Chamber. This body will be responsible for monitoring affected companies, overseeing labor agreements, and negotiating solutions to preserve jobs.
The Chamber may also propose emergency actions, mediate conflicts, and oversee the payment of benefits, using the structure of the Regional Labor Superintendencies.
Impacts on Companies and Workers
The reduction of working hours is seen as a necessary evil to avoid large-scale layoffs. Although it implies proportional salary loss, it can maintain employment ties until the sectors find new markets or alternatives to mitigate the impact of American tariffs.
For companies, the temporary suspension of labor charges would be immediate relief, but it depends on political and legal consensus to be applied without creating room for legal uncertainty.
The government’s challenge is to balance social protection and business competitiveness in a scenario of international pressure. While Brazil questions the tariffs at the World Trade Organization (WTO), internally it seeks swift measures to prevent the crisis from turning into mass unemployment.
And you, do you think that reducing working hours is the best solution to preserve jobs? Or should the government adopt other more direct measures? Leave your opinion in the comments and join the debate.
Como sempre os trabalhadores pagam pelas irregularidades dos covernantes.
Governo incompetente!
Governo que sempre busca alguém pra culpar pela sua própria incompetência?