Employee Benefits in Brazil: What Global Employers Need to Know in 2025
Expanding into Brazil is an exciting opportunity, but understanding employee benefits in Brazil brings new responsibilities.
Brazil's employment benefits reflect its societal values, emphasizing community and well-being, much like countries with progressive benefits such as Sweden or Denmark. For instance, while Brazil mandates a 13th salary and paid vacation, it lacks the universal parental leave seen in some European nations.
In this guide, we'll cover the basics of managing employee benefits in Brazil, including eligibility, mandatory benefits, and additional perks to make your company stand out.
Partnering with an Employer of Record (EOR) in Brazil can simplify this process. Explore how to manage benefits efficiently, ensuring compliance and competitiveness while focusing on growing your team.
Who Qualifies for Statutory Benefits in Brazil?
In Brazil, employees with formal employment contracts governed by the Consolidation of Labor Laws (CLT) are entitled to statutory benefits. This includes full-time, part-time, and fixed-term employees.
These workers are automatically enrolled in the General Social Security System (Regime Geral de Previdência Social - RGPS) and contribute to the National Social Security Institute (Instituto Nacional do Seguro Social - INSS).
Through the INSS, they receive benefits such as:
- Pensions
- Health insurance, including sickness and accident benefits
- Unemployment insurance
- Maternity and paternity leave
- Death pensions
Employees are eligible for these benefits from the commencement of their employment, provided they meet the specific contribution requirements for each benefit.
Who Is Excluded?
Certain categories of workers are not automatically entitled to full statutory benefits in Brazil:
- Freelancers and Independent Contractors: Individuals working under the "Pessoa Jurídica" (PJ) model or as autonomous workers are not covered by the CLT and, therefore, do not receive statutory benefits. However, they can opt to contribute to the INSS voluntarily to access certain benefits.
- Interns and Temporary Agency Workers: Interns are generally not covered by the CLT and thus do not receive statutory benefits. Temporary agency workers may have conditional eligibility based on specific criteria and the nature of their contracts.
For more detailed information about statutory benefit eligibility, visit Brazil’s official INSS website.
Statutory Employee Benefits in Brazil
Understanding and complying with statutory benefit requirements in Brazil is crucial for employers to avoid potential legal, compliance, and reputational issues. Non-compliance can lead to significant fines and damage to a company's reputation.
The following sub-sections explain the mandatory benefits Brazilian employers must provide:
13th-Month Salary (Décimo Terceiro Salário)
This is an annual bonus equivalent to one month's salary, paid in two installments: the first by November 30th and the second by December 20th. (For employees who joined a company mid-year, the bonus amount would be pro-rated accordingly.)
It's essential for employee satisfaction and retention, and is administered directly by the employer.
Paid Vacation (Férias)
Employees are entitled to 30 days of paid vacation annually after 12 months of service, plus an additional one-third of their monthly salary as a vacation bonus. This is crucial for employee wellness and is managed by the employer.
Social Security Contributions (Contribuições Previdenciárias)
Covering health, pension, unemployment insurance, maternity, sickness, and other social benefits, these employee contributions are deducted from Brazilian employee salaries and matched by the employer. They ensure long-term security and are managed through the national social security system (the INSS).
Employers contribute 20% of the employee's salary, while employees contribute between 7.5% and 14%, depending on their income.
Severance Indemnity (FGTS)
The severance indemnity fund, also known as the Fundo de Garantia do Tempo de Serviço or FGTS, supports employees in cases of unfair dismissal.
Employers must contribute 8% of the employee's salary monthly to this fund, and it is administered by Caixa Econômica Federal. For certain types of workers, the contribution rates fluctuate. For example, the employer contribution rate for domestic workers is 11.2%, whereas the rate for apprentices is only 2%.
The FGTS severance funds are available to an individual upon dismissal without cause, upon retirement, or for housing purposes.
Health and Safety Compliance (Normas Regulamentadoras)
Employers must adhere to regulations ensuring workplace safety and health, minimizing risks and enhancing employee well-being.
Maternity Leave (Licença Maternidade)
Female employees are entitled to 120 days of paid leave. Funded by the INSS, this benefit is vital for supporting family life. The program is administered through social security with employer cooperation.
Worth noting, an extension of 60 additional days (for a total leave of up to 180 days) is available if an employer participates in the Empresa Cidadã program.
Paternity Leave (Licença Paternidade)
Male employees receive five days of paid leave following the birth of a child, promoting shared parental responsibilities.
For staff working for employers participating in the Empresa Cidadã program, they can request an extension of 15 more days (for a total leave of 20 days).
Transportation Voucher (Vale Transporte)
Employers must provide or subsidize public transportation costs for employees commuting to work, enhancing accessibility and reducing commuting stress.
Employees contribute up to 6% of their salary, with the employer covering the remaining transportation costs. The employer must also purchase the transportation voucher and cannot simply substitute the voucher with additional cash.
These benefits are mandated by the Consolidation of Labor Laws (CLT) and are enforced by the Ministério do Trabalho e Emprego (MTE). Compliance ensures that employers maintain a positive reputation and foster a supportive work environment.
Leave Entitlements in Brazil
Brazil's leave entitlements are varied and well-protected by labor laws, ensuring employees receive necessary time off for personal, cultural, or family reasons.
The following are key types of leave provided by Brazilian labor laws, which additional details provided for each leave type below:
| Leave Type | Duration | Who It Applies To | Who Pays | Notes |
| Annual Paid Vacation | 30 calendar days | All employees after 12 months service | Employer | Additional ⅓ salary bonus ("abono de férias"); vacation pay must be advanced 2 business days. |
| Public Holidays | 13 national + state/local holidays | All employees | Employer | Mandatory paid leave; double pay if an employee works on a national holiday. |
| Sick Leave | Up to 15 days | All employees with medical certificate | Employer | Must present doctor’s note; dismissal protection during sick leave. |
| From day 16 onwards | INSS (Social Security) | Sickness benefit capped (approx. BRL 6,433–7,500/month); 12-month dismissal protection may apply. | ||
| Maternity Leave | 120 days (up to 28 days pre-birth) | Female employees | INSS via employer advance | Can be extended to 180 days under the Empresa Cidadã program. |
| Paternity Leave | 5 days | Male employees | Employer | Can be extended to 20 days under the Empresa Cidadã program. |
| Parental Leave | N/A (no statutory leave) | Parents beyond maternity/paternity | N/A | May be offered voluntarily as unpaid leave by employers. |
| Bereavement Leave | 2 days (up to 5 via CBA) | All employees | Employer | Typically applies to immediate family loss. |
| Marriage Leave | 3 days | Employee getting married | Employer | For the employee’s own wedding. |
| Blood Donation Leave | 1 day per 12 months | All employees | Employer | For voluntary blood donation. |
| Electoral Leave | 2 days for first-time registration | Eligible voters | Employer | Additional voting days (elections, run-offs) are also covered. |
| Military Leave | As required | Reservists | Employer | Covers time to comply with military obligations (no fixed duration). |
| Jury/Court Duty Leave | As required | Jurors and summoned employees | Employer | Applies to jury duty or legal summons. |
| Vestibular/ENEM Leave | 1 day per exam | Employees taking entrance exams | Employer | Applies to university entrance exams (vestibular/ENEM). |
Annual Paid Vacation (Férias)
Employees are entitled to 30 days of paid vacation after 12 months of service, intended to support rest and recuperation.
Employers manage this leave and provide an additional one-third of the employee’s monthly salary as a vacation bonus (called “abono de férias”). Employers must pay the vacation salary two business days before the employee’s time off begins.
Public Holidays (Feriados)
Brazil observes 13 public holidays, plus numerous additional state and municipal holidays. The administration of holidays in Brazil depends on federal, state, and municipal regulations.
During national holidays, employees are entitled to these days off with regular pay. If an employee is required to work on a national holiday, they are entitled to receive double pay for those hours.
Sick Leave (Licença Médica)
Employees can take up to 15 days of paid sick leave, covered by the employer. For illnesses stretching beyond 15 consecutive days, Brazil’s social security (INSS) sickness benefit kicks in and provides compensation, supporting employee health and recovery.
The INSS sickness benefit payment is generally between BRL 6,433 to 7,500/month. Employees are also required to provide a medical certificate from a doctor confirming the nature of their illness.
During a period of sick leave, Brazilian laws protect employees from being dismissed from employment. For employees who have been on lengthy sick leave and received INSS compensation, they are protected from dismissal for 12 months after their return to work.
Maternity Leave (Licença Maternidade)
As mentioned above, female employees receive 120 days of paid maternity leave for childbirth. This leave can begin up to 28 days before the child is born.
If an employer is participating in Brazil’s Empresa Cidadã program, expecting female employees can request a maternity leave extension of 60 additional days (for a total of 180 days of paid maternity leave).
This benefit is administered through social security with employer coordination, and supports family life and maternal health.
Paternity Leave (Licença Paternidade):
Male employees are entitled to five days of paid leave following the birth of a child, promoting paternal involvement and family bonding.
As noted above, fathers in Brazil are entitled to five days of paid leave immediately after the birth of a child, promoting shared parental responsibilities.
If the father’s employer is participating in the Empresa Cidadã program, they can request an extension of 15 more days (for a total of 20 days paternity leave).
Parental Leave (Licença Parental):
Currently, there are no statutory requirements to offer parental leave in Brazil, beyond what is already offered as maternity and paternity leave. However, some companies do offer additional unpaid leave to support employee family needs.
Other Special Occasion Leaves
Brazil also mandates several additional leave categories that are used less commonly, but still important to understand:
- Bereavement leave is typically 2 consecutive paid days, but is extendable up to 5 days via collective bargaining agreements.
- Marriage leave is mandated at 3 paid days for the employee’s wedding.
- Blood donation leave is offered at 1 paid day per 12 months for voluntary blood donation.
- Electoral leave, which covers voter registration and voting separately, offers 2 paid days (consecutive or not) for first-time voter registration. Additional voting days (election day and any run-offs) are also covered without salary deduction, though CLT doesn’t specify exact numbers.
- Military leave for reservist duties is offered to cover the time required to comply with military reserve service obligations, such as reservist certificate ceremonies. Again, the CLT doesn’t specify a fixed number of days, just that the time is granted as needed.
- Jury leave (also known as court duty leave) ensures employees are entitled to paid leave for the necessary period when serving as a juror or appearing in court — again, with no fixed day limit.
- Vestibular or ENEM leave offers one full paid day to individuals who must complete Brazil’s Vestibular Exam, which is a competitive university entrance exam (also called an ENEM exam).
Brazil's leave policies are generous compared to many countries, particularly in maternity and vacation entitlements, fostering a more productive and engaged workforce. Employers benefit from these policies by maintaining a committed and satisfied team.
Common and Additional Employee Benefits in Brazil
In Brazil, while not mandatory, several additional benefits are commonly offered by employers to enhance employee satisfaction, loyalty, retention, and productivity.
The most commonly offered non-mandatory employee benefits in Brazil include:
Private Pension Plans (Previdência Privada)
Offered as a supplement to the public pension system, some employers offer defined-contribution plans with an employer matching program, typically around 3% of an employee’s base salary.
This benefit is offered to improve long-term financial security for Brazilian employees.
Supplemental Health Insurance (Plano de Saúde/Dental)
Private health insurance in Brazil is a widely valued benefit since it provides faster access to doctors, broader hospital networks, and coverage for dependents. Full employer coverage is common, though cost-sharing models exist. Plans often include dental and vision, too.
This benefit is offered in addition to basic healthcare coverage to ensure employees have access to a broader range of medical services.
Company Cars (Carros da Empresa)
Company cars are sometimes provided to employees, particularly for those in sales or executive roles. This benefit helps facilitate transportation and improve job satisfaction and efficiency for employees that need to travel for their role.
Performance Bonus (Bônus de Desempenho)
Performance-based bonuses are often provided when employees meet defined targets or show exceptional performance. These may be structured as spot bonuses or annual awards.
These merit-based awards, while not mandatory or regulated, are known to boost motivation and productivity among employees.
Computer Allowances (Auxílio para Computador)
In recent years, especially since the pandemic, many companies have started to offer computer or technology allowances to make remote work easier on employees. These flexible stipends can be used for numerous technology requirements, often covering hardware or software costs.
Christmas Bonus (Bônus de Natal)
An additional monetary gift (separate from the 13th month salary payment) is often given at the end of the year to enhance employee morale and demonstrate goodwill by employers. The bonus may be offered as cash, as prepaid benefit cards, or as meal vouchers.
Trends have shown that 66% of Brazilian employees prefer a gift card over a traditional Christmas hamper, reinforcing engagement and cost-effective delivery.
Vacation Bonus (Abono de Férias)
Although the ⅓ vacation bonus is statutory, many employers add extra financial incentives at vacation time as part of their benefits approach and to further encourage employees to use their time off.
By providing these additional benefits, employers create a more appealing workplace, which can lead to a more engaged and productive workforce.
In fact, these benefits are so popular and effective in boosting employee satisfaction and retention, that they are now considered expected perks in Brazil.
However, many companies offering these competitive benefits report higher levels of employee engagement and loyalty, which makes them even more important to consider.
Benefits That Attract Top Talent in Brazil
While these benefits aren’t legally required — or yet fully embedded in the culture — they’re increasingly offered by forward-thinking Brazilian employers competing for top talent.
Here are several cutting-edge offerings that address modern employee needs and expectations:
Flexible Work Arrangements
Allowing employees to choose their working hours or work remotely has been shown to positively impact work-life balance and increase job satisfaction. As a result, many companies now offer employees a mix of remote work, flexible schedules, and hybrid models.
Wellness Programs
Many modern companies now provide resources for mental and physical health, such as gym memberships subsidies, access to mental health support, meditation or yoga classes, health screenings, and employee assistance programs (EAPs), promoting overall employee well-being.
These programs are valued by employees and contribute to higher morale and engagement.
Profit Sharing Programs
Though not universally mandatory, profit-sharing (PLR/PPR) is regulated by Law 10.101/2000 and the Constitution (Art. 7 XI). However, if profit-sharing is included within a collective bargaining agreement or other internal employee agreement, then it does become mandatory based on the terms of those legal documents.
Employers typically design their profit-sharing criteria based on profitability, productivity, or performance metrics, which must be objective and transparent.
PLR payments are typically made annually or bi-annually, with up to two installments paid at least 90 days apart. Amounts paid under a valid PLR plan are exempt from INSS and FGTS contributions, and income tax benefits apply.
Other Unique Perks
Some organizations offer unique benefits that are tailored to their workforce’s interests, enhancing their workplace culture and employer appeal. Some examples include pet insurance, paid volunteer days, childcare support, food vouchers, and company-sponsored life insurance or disability insurance.
These benefits have become increasingly popular in Brazil’s competitive talent market. As a result, employers offering them often enjoy higher satisfaction, retention, and employer brand strength.
How to Set Up and Manage Employee Benefits in Brazil
Setting up and managing employee benefits in Brazil involves several key steps to ensure compliance and employee satisfaction.
Here's how companies can effectively establish and administer their benefits programs:
1. Partner with Local Benefits Providers
Collaborate with Brazilian health insurers, private pension firms, and wellness vendors to tailor benefits that meet both legal standards and employee needs.
These providers offer deep market knowledge, cost-effective plan design, and assistance with enrollment and claims management.
2. Ensure Compliance with MTE Regulations
Keep up to date with regulations from the Ministério do Trabalho e Emprego (MTE) and labor laws (CLT) regarding benefits like FGTS, INSS, statutory leave, and meal or transit vouchers.
Regular internal or external audits of benefit processes help mitigate compliance risks and potential fines or reputational damage.
3. Communicate Benefits to Employees
Develop a comprehensive benefits handbook or digital portal explaining eligibility, procedures, and coverage options. You can also use employee surveys, info sessions, and onboarding communications to ensure employees understand their entitlements and how to access them.
4. Monitor and Update Benefits Offerings
Regularly review and update the benefits program to align with changing regulations and employee preferences, maintaining competitiveness in the job market.
To do this, I recommend regularly benchmarking benefits against industry peers and gathering additional feedback through employee surveys. You can also set up an annual review to evaluate benefit utilization, costs, and emerging needs, then adjust your offerings as regulations or employee expectations evolve.
5. Outsource Benefits Management to a Brazilian EOR Service
If you want to avoid all the hassles described above, or for foreign companies who want to hire talent in Brazil without opening a local legal entity, consider outsourcing this process to a Brazilian Employer of Record (EOR) service instead.
Working with an EOR in Brazil is a streamlined solution for managing employee benefits, and numerous other tasks. Other responsibilities you can outsource to an EOR include:
- Employment contracts and onboarding
- Social insurance contributions
- Payroll and tax compliance
- Statutory benefits enrollments and employee communication
- Visa and work permit assistance
Relying on an EOR partnership helps you remain compliant with Brazilian labor laws while avoiding the complexity of establishing a local subsidiary and, ultimately, giving you peace of mind that you won’t run into legal challenges. Definitely an option worth considering!
By following these steps, or partnering with an EOR, you can create a robust benefits program that not only complies with Brazilian regulations but also attracts and retains top talent.
Why Compliance is Important
Adhering to Brazilian labor laws and regulations is essential, not only to avoid direct financial repercussions, but also to safeguard your company’s reputation and operational future.
Failing to comply can lead to the following risks and negative outcomes:
- Employee Misclassification: Misclassifying workers as contractors when they meet the criteria of employees can trigger labor disputes, back-pay of wages, benefits (e.g., overtime, vacation, 13th salary), social security (INSS), FGTS, and even legal fees.
- Fines for misclassification start around BRL 400 per employee, increasing to 75–225% of the amount owed; in large-scale cases, penalties can reach millions of reais.
- Underfunding Social Security Contributions: Employers are legally required to contribute to INSS and FGTS. Failure to do so can result in fines of 75% of the unpaid contributions, plus interest and administrative fees.
- In addition, delayed payments such as for the 13th salary or transportation vouchers carry fixed daily fines (e.g., ~BRL 170 per infraction).
- Corporate Fines and Penalties: Non-compliance with labor obligations (e.g., not paying required benefits on time, breaking safety regulations, failing to comply with collective bargaining agreements, etc.) can lead to administrative fines ranging from dozens to hundreds of reais, or even thousands depending on the infraction.
- Labor audits initiated by the MTE or INSS can uncover widespread violations—resulting in back-payments, fines, and elevated legal expenses.
- Reputational Damage: Frequent labor court or regulatory actions harm your brand, undermine stakeholder trust, and make recruitment of top talent more difficult.
- Misclassification in particular could bar your ability to bid on government contracts, or to partner with large firms that require compliance certification.
Staying compliant is not merely about following the law—it’s about preserving your company’s integrity, financial stability, and ability to thrive in the Brazilian market. Prioritizing compliance reduces legal exposure, supports healthy workplace culture, and enhances competitiveness in the eyes of employees and clients alike.
Get Support Setting Up Benefits in Brazil
Navigating employee benefits in Brazil involves aligning your offerings with both statutory obligations and employee expectations. Core legal requirements—like the 13th-month salary, paid annual leave, FGTS, and INSS contributions—form the foundation of a compliant employment framework.
At the same time, providing additional benefits such as wellness programs, flexible work arrangements, supplemental health insurance, or profit-sharing programs (PLR) can make a major difference in attracting and retaining top talent in Brazil’s competitive job market.
Brazilian labor law is detailed and dynamic, requiring regular updates to benefits offerings to ensure ongoing compliance and relevance. That’s why many companies rely on a Brazilian EOR service, to stay informed, responsive, and compliant with regulations, while minimizing risk.
If you’re ready to take the plunge, here’s my list of the best EOR providers in Brazil that can help you take the next steps:
Here's my pick of the 10 best software from the 10 tools reviewed.
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