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Doing Business in Brazil
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100% higher than the normal hour salary.
2. Termination
2.1 Prior Notice of Dismissal
In case of dismissal of an employee without cause, the employer must give prior notice from 30 to 90 days to the employee, which will depend on the period of time that the employee worked in the company, being added to the 30 days base prior notice, 3 days for each complete year worked.
In case the employer does not want to keep the employee during the prior notice period, it must pay
the employee for this period, as if the employee has worked for such period. The payment must occur up to 10 days upon termination of the employment agreement, alongside the other severance funds.
The severance funds due to the employee in case of dismissal without a fair cause will be the salary from the last month of work; proportional 13th salary, accrued and proportional vacations plus 1/3 and the fine of 40% of the total amount deposited
in the FGTS account during the employment agreement (severance fund).
2.2 Severance Fund (FGTS)
The FGTS is a labor credit resulting from forced savings on the part of the employee, conceived to assist him/her in exceptional situations
during the term of the employment contract or after the termination thereof. The employer is obliged
to collect 8% of the worker’s compensation and deposit that amount in a specific account in the name of the employee up to the 7th day of the subsequent month.
2.3 Brazilian Social Security Contribution (INSS)
According to Article 195 of the Federal Constitution, the Social Security will be financed by funds coming from the government budgets and by Social Contributions paid by (i) employers, over the payroll and other income related
to workforce paid or credited to individuals who render services at any kind to such company even without employment ties; and
(ii) individuals, over the amounts received subject to a threshold cap.
The payment to Social Security due by the company and the individuals is the payment that is due by the employer, who must also withhold and deduct from the employees’ salary the portion that the employee must contribute.
2.4 Union and Collective Bar- gaining Agreements
The Brazilian Constitution adopted the principle of Union unity, prohibiting the creation of more than one Union, on any level, representing a professional or economic class,
in the same territory, which will be defined by the interested workers