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How to hire and pay employees in Brazil
Slasify
Jun 21, 2025
Before Hiring in Brazil
Discover the global hiring and employment landscape in Brazil—For those expanding to the South American market, Brazil is an excellent choice. Its membership in trade groups like BRICS makes it appealing for businesses, and as an emerging market with business-friendly policies, it's an attractive option for growth.
Explore the employment essentials including payroll, personal income tax, statutory contributions, annual leaves, minimum wage, terminations, visa requirements, and more. Gain valuable compliance insights for a smooth entry into the dynamic Brazil market with Slasify's global premium HR platform.
At a Glance
| Capital | Brasília |
| Currency | Brazilian Real (BRL) |
| Payroll Cycle | Monthly |
| Minimum Wage | BRL 1,518 per month |
| Annual Leave | 30 days |
| Personal Income Tax | Up to 27.5% |
Personal Income Tax
Non-residents are taxed at a flat rate of 25% on their gross employment income, whereas tax residents are subject to the following progressive tax rates:
| Taxable Income (BRL) | Progressive Tax Rate (%) |
|---|---|
| Up to 2,259.20 | - |
| 2,259.21–2,826.65 | 7.5 |
| 2,826.66–3,751.05 | 15 |
| 3,751.06–4,664.68 | 22.5 |
| Over 4,664.68 | 27.5 |
Local Taxes
There are no local taxes on employment income in Brazil.
Statutory Contributions
Employer Contributions
| Contribution Rates | Notes | |
|---|---|---|
| Social Security (INSS) | 20% | +2.5% for financial institutions |
| Employees' Severance Indemnity Fund (FGTS) | 8% | - |
| Work accident insurance (RAT) | 1%–3% | Determined based on risk. |
| Other contributions (education, professional training, etc.) | 5.8% | - |
Employee Contributions
Employees' social security (INSS) contribution rates are applied progressively depending on their monthly salaries, as follows:
| Monthly Salary (BRL) | Progressive Contribution Rates |
|---|---|
| Up to 1,518.00 | 7.5% |
| 1,518.01–2,793.88 | 9% |
| 2,793.89–4,190.83 | 12% |
| 4,190.84–8,157.41 | 14% |
Monthly salaries used to calculate contributions to the INSS for employees are subject to a minimum of BRL 1,518 and a maximum of BRL 8,157.41.
Payment of Wages
Employees shall be paid at least once per month, with monthly payment being made within 5 working days of its due date.
Minimum Wage
Effective January 1, 2025, the general minimum wage in Brazil is set at BRL 1,518 per month.
Statutory Bonus
Employers are obligated to pay an annual Christmas bonus to their employees.
| FAQ | Answer |
|---|---|
| When is this payment due? | This payment can be made in 2 installments—by November 30 and December 20 of each year |
| How is this bonus calculated? | The bonus shall be equivalent to 1/12 of the remuneration due in December per month of service of the corresponding year. A fraction equals to or greater than 15 working days shall be considered as a full month worked for calculation purposes. |
In addition to the above, and depending on the collective agreement that covers the business, employers may be required to afford additional allowances and benefits to the employee.
Termination
Both employers and employees can terminate employment contracts at will, provided that the rules surrounding notice period and severance are respected. However, whether the termination requires any notice period to be observed or any severance to be paid depends on if there is just cause for dismissal or resignation.
It is important to note that certain categories of employees can only be dismissed due to particularly serious misconduct, and some shall not be dismissed without just cause. For instance, those who have worked for more than 10 years in the same company cannot be dismissed except for reasons of serious misconduct or force majeure.
Note: Those accused of serious misconduct may be suspended from work, but their dismissal will only become effective after the investigation and the verification of the accusation.
Notice Period
In the event of termination, the following notice period shall generally be observed:
| Notice Period | |
|---|---|
| Dismissal without just cause | 30 days, plus 3 days for every additional year of service up to a maximum of 90 days |
| Voluntary resignation | 30 days |
| Termination by mutual agreement | 15 days |
In cases of dismissals without just cause, the first 30 days of notice can be worked or paid in lieu, while those in excess of 30 days shall always be indemnified instead of worked.
The working hours of employees serving their notice period shall be reduced by 2 hours per day without any reduction in pay. That being said, employees may opt out of this reduced hours arrangement and be entitled to not report to work for their last week of notice period instead.
Severance Pay
Employers are required to contribute 8% of their employees' monthly salaries to their respective Employees' Severance Indemnity Fund (FGTS).
The amount accumulated in the employee's FGTS account may be withdrawn if their employment is terminated, though depending on the reason for termination, the employee may only be entitled to partial withdrawal. Any remaining amount inside the FGTS account will be accessible for the employee's future termination or retirement.
In certain cases, employers may be required to pay their employees an additional amount, calculated as a percentage of the amount accumulated in the employees' FGTS fund.
The severance an employee is entitled to upon termination will depend on the reason for their termination, as follows:
| Severance Pay | |
|---|---|
| Dismissal with just cause | - |
| Dismissal without just cause | FGTS fine equivalent to 40% of FGTS fund + 100% of FGTS deposits |
| Voluntary resignation | - |
| Involuntary resignation, i.e. with just cause | FGTS fine equivalent to 40% of FGTS fund + 100% of FGTS deposits |
| Termination by mutual agreement | FGTS fine equivalent to 20% of FGTS fund + 80% of FGTS deposits |
| Termination due to the fault of both employee and employer | FGTS fine equivalent to 20% of FGTS fund + 100% of FGTS deposits |
Probationary Period
Probationary period is considered one of the legitimate justifications to conclude a fixed-term contract, and fixed-term contracts concluded for probation are subject to a maximum duration of 90 days, including renewals.
After completing a 90-day probationary period (with no prior renewals), the employer can either renew the contract once for up to another 21 months or conclude an indefinite-term contract.
If an initial probationary period is agreed to be set at 45 days, and the contracting parties decide to renew the contract to extend the probationary period for another 45 days to reach the maximum duration of probation allowed, they will no longer be able to continue the employment relationship on a fixed-term basis since they have already used their one renewal opportunity.
Note: Fixed-term contracts can only be renewed once.
Work Time Rules
Standard Working Hours
Standard working hours in Brazil is subject to a maximum of 8 hours per day or 44 hours per week.
Employees can make an arrangement with their employers, by virtue of individual or collective agreements, to establish a 12-hour workday, followed by 36 uninterrupted hours of rest, observing or compensating for break time.
Break Period
Employees are entitled to a break time of at least an hour, and up to 2 hours, for every 6 hours of continuous work. For work that does not exceed 6 hours, a break period of at least 15 minutes must be granted to employees working more than 4 hours.
While the break period is not counted as working hours, employees required to work on their break time shall be paid 150% of their normal hourly wage for the hours worked.
In addition to the normal break periods, female employees with a child under 6 months of age are entitled to a 30-minute breaks for breastfeeding, twice per day.
Overtime
Daily duration of work may be increased by up to 2 hours of overtime by individual or collective agreement, provided that the overtime work is paid at 150% of the employee's normal hourly wage.
Employees can make an arrangement with their employers, by virtue of individual or collective agreements, that allows for more working hours per day without incurring overtime pay if certain conditions are met.
Weekly Rest Days
Employees are entitled to 11 consecutive hours of rest in between every working day and a weekly rest of 24 consecutive hours which, except for reasons of public convenience or imperative need of the service, must wholly or partly fall on a Sunday.
Any work that falls on a Sunday is subject to prior permission from the competent labor authority. Employees required to work on their weekly rest days due to the technical requirements of the companies shall be paid 200% their regular pay.
Holiday and Leave Entitlements
Public Holidays
Employees required to work on public holidays are subject to the same restrictions as those required to work Sundays. There are 10 days of mandatory public holidays in Brazil for 2025.
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| Good Friday | April 18 |
| Tiradentes | April 21 |
| Labor Day | May 1 |
| Independence Day | September 7 |
| Nossa Senhora Aparecida | October 12 |
| All Souls' Day | November 2 |
| Proclamation of the Republic | November 15 |
| Black Consciousness Day | November 20 |
| Christmas Day | December 25 |
In addition to the above dates, Brazil also have non-mandatory holidays, and their dates for 2025 are as follows:
| Optional Holiday | Date |
|---|---|
| Carnival | March 3–5 (until March 5, 2:00 p.m.) |
| Corpus Christi | June 19–20 |
| Public Servant's Day | October 28 (celebrated in October 27) |
| Christmas Eve | December 24 (after 1:00 p.m.) |
| New Year's Eve | December 31 (after 1:00 p.m.) |
Employees required to work on public holidays due to the technical requirements of the companies are to be paid 200% their regular pay.
Note: Some regions may have additional holidays that are subject to the same restrictions as other national holidays.
Annual Leave
Employees who have completed a full year of service are generally entitled 30 calendar days of annual leave, which can either be taken consecutively or be divided into 3 periods, provided that one of them is not less than 14 consecutive days and the others are not less than 5 consecutive days.
Annual leave shall be taken within 12 months of its accrual. Any unused leave must still be granted to the employee, provided that any leave carried over to the following years are paid double the remuneration.
Employees are entitled to an annual leave premium equivalent to 1/3 of their monthly pay on top of their regular pay, which shall be paid at least 2 days before the beginning of leave.
Sick Leave
Employers are obligated to cover 100% of their employees' salaries on sick leave for the first 15 days of illness. Subsequent days shall be covered by the social security body at an amount determined by the INSS.
Note: The pay from the INSS is only applicable to employees who have worked for the company for at least a full year.
Maternity Leave
Female employees are entitled to 120 days of paid maternity leave, which can be taken from between the 28 days prior to the expected date of delivery and the date of delivery. This can be further extended by 2 weeks before and after childbirth if it is required by a medical certificate.
Employees on maternity leave shall be entitled to their full pay, with those earning variable pay being entitled to an amount calculated based on their average earnings in the last 6 months. This payment is paid by the employer and then deducted from their subsequent social security contributions to the INSS.
The provisions of maternity leave shall apply to female employees who adopt or obtain legal custody of a child.
Employers registered under the optional Empresa Cidadã program can grant employees an additional 60 days of paid maternity leave, the pay of which can be deducted from their corporate tax contributions. In the case of adoptions, the duration of additional leave shall vary according to the adopted child's age, as follows:
| Adopted child's age | Additional leave |
|---|---|
| Up to 1 years old | 60 days |
| 1–4 years old | 30 days |
| 4–8 years old | 15 days |
Paternity Leave
Male employees are entitled to 5 consecutive days of paid leave in the case of child birth, adoption or shared custody, calculated from the child's birth or adoption.
Employers registered under the optional Empresa Cidadã program can grant employees an additional 15 days of paid paternity leave, the pay of which can be deducted from their corporate tax contributions.
Other Leave
As per Articles 472–473 of the CLT, employees are entitled to the following paid leaves:
| Reasons for leave | Duration | Note |
|---|---|---|
| Accompanying a child for their medical appointment | 1 day | This can be taken for children up to 6 years of age, and can only be taken once per year |
| Accompanying a pregnant spouse for medical consultations | 6 medical consultations | - |
| Appearing in court | - | - |
| Bereavement | 2 consecutive days | Can be taken in the event that a spouse, ascendant, descendant, sibling or registered dependent has died. |
| Marriage | 3 consecutive days | |
| Military reservist duties | - | Can be taken by Reservists who are exercising the presentation of reserves or civic ceremony on the Day of the Reservist. |
| Military service or other public duties | - | This shall only be paid for the first 90 days of leave. To return to their previous position, the employee shall notify employers within 30 days before their intended return. |
| Preventive cancer exams | 3 days | Requires proof and can only be taken once per 12 months of service |
| Registering as a voter | 2 days | - |
| Representing unions in official meetings of international organizations of which Brazil is a member | - | - |
| Taking entrance exams to a higher education establishment | - | - |
| Voluntary blood donation | 1 day | Requires proof and can only be taken once per 12 months of service |
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