Employee Benefits in Brazil: 2025 Guide

Brazil can be an extremely attractive place to do business, with a large and growing economy and a talented workforce. If you have a business and are thinking of taking on employees in Brazil - either as remote workers or to expand your operation in the country - you’ll need to learn about Brazilian employment laws and practices.

As you may expect, employee benefits in Brazil aren’t the same as you may come across in the US, so reading up and getting some professional advice is important. This guide covers the basics to get you started.

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Table of contents

Who gets benefits in Brazil? Mandatory Employee Benefits in Brazil 1. 13th-month salary or Christmas bonus 2. Social Security (INSS) 3. Pension (FGTS) and Severance fund 4. Sick pay and workers’ compensation 5. Transportation voucher 6. Overtime in Brazil 7. Vacation pay and vacation bonus 8. Lump sum death benefits 9. Family allowance 10. Child daycare 11. Basic food basket allowance 12. Leave entitlements in Brazil 13. Statutory holidays in Brazil 14. Brazilian minimum wage Non-mandatory Employee Benefits in Brazil

Who gets benefits in Brazil?

If you have employees in Brazil, you’ll need to know which mandatory benefits you must pay. Employees may be entitled to some benefits through national or local law, but bear in mind Collective Bargaining Agreements can also apply which mandate additional benefits.

Many benefits are offered only for employees - rather than for contractors and self employed people. Before you start to employ people in Brazil, be sure to understand the range of additional costs - which can be fairly high compared to the US - and confirm the employment status of any worker before agreements come into effect.

This guide is intended for information only. Managing employee benefits - particularly in a different country - can be complex, and can have financial and legal consequences if you get it wrong. Take professional advice if you’re ever unsure about your obligations.

Mandatory Employee Benefits in Brazil

Some employee benefits in Brazil are mandatory for everyone, regardless of their salary or working situation. Others depend on the individual’s salary, or family situation. You may also find that some companies have Collective Bargaining Agreements which then mandate further benefits. This makes it essential to understand the unique situation of your business, to make sure you’ve got all of your obligations covered. Here are a few things to consider.

1. 13th-month salary or Christmas bonus

Whilst a 13th month salary isn’t usually offered in the US, it’s very common in Latin America, and also in many countries in Europe. You can consider this similar to a Christmas Bonus, but in Brazil it’s a mandatory payment. Employers may split the payment of this 13th salary into two, with one section paid earlier in the year, and the balance paid just before Christmas. This approach can help employees manage their expenses over Christmas and the New Year.

Where the employer must make or withhold contributions for things like Social Security, the total amount used for base pay to calculate withholdings will usually include the 13th month salary.

2. Social Security (INSS)

The Instituto Nacional do Seguro Social − INSS¹ - is the Brazilian State’s social security system which supports over 90 million policyholders, and exists to support vulnerable citizens with things like²:

• Pensions
• Sickness benefits
• Maternity pay
• Family allowance
• Unemployment insurance
• Work injury and death benefits

Both the employer and the employee must pay into the INSS with employers usually contributing 20% of the employee’s salary, and the employee contributions varying depending on their salary level.

3. Pension (FGTS) and Severance fund

The Fundo de Garantia do Tempo de Serviço - FGTS - is the Brazilian pension scheme which operates as both a pension, savings scheme and a sort of insurance against layoffs and dismissals. The employer withholds a set amount from the employee’s salary monthly, usually 8%, and pays this into their FGTS fund. This fund can then be drawn upon by the employee if they’re laid off, or in the case of some sickness dismissals. Depending on the circumstances, the employer may also need to add additional money to the pot before the employee draws it.

If you resign, the FGTS fund does not payout but the money paid in rolls forward to protect you in future in the case of lay off.

4. Sick pay and workers’ compensation

If an employee is sick, the employer must continue to pay them full salary for up to 15 days. If the employee can still not work after that, the INSS will step in and pay sickness benefits which will be slightly below full pay, usually at around 90% of the regular salary of the individual.

Workers’ compensation is also administered by the INSS, and is used when an employee is sick or injured and unable to work, due to workplace injuries or illness. The employer must continue to pay the employee for the first 15 days of sickness absence, at 100% of pay, as long as they can produce an appropriate medical certificate. After this, the INSS will start to pay compensation to the employee if they’re still unable to work. Payments are fixed based on the specific circumstances of the employee, and their ability to return to some duties in future.

5. Transportation voucher

In some cases, employers must issue a transportation voucher - a Vale-transporte - to employees who have to commute to work. This benefit is designed to lessen the financial burden of transport in busy cities, and is aimed at lower paid workers who may otherwise need to pay a significant slice of their salary on transport costs. The Vale-transporte is only offered when the employee’s transport costs hit 6% of their salary, so whether or not this benefit is required depends on the employee’s pay and transport costs.

6. Overtime in Brazil

Generally full time workers in Brazil work 40 hours a week over a 5 day period, or 44 hours over 6 days. Employees on hourly paid contracts can not work more than 2 additional hours of overtime per day without a specific agreement being in place, with overtime being paid at a higher rate of apply - usually 1.5x. Overtime on weekends or public holidays can be paid at a higher rate still.

As in most countries, some jobs which include positions of trust like managers and executives, and more flexible roles like sales, may not qualify for overtime.

7. Vacation pay and vacation bonus

Vacation pay in Brazil is generous by world standards, and requires employees to take at least one continual 14 day break over the course of the year. On top of this, employees must then take at least 2 breaks of 5 days at a time. In total, employees have a mandatory 30 day vacation leave annually, although they can sell back 10 days to their employer if they don’t want to take so much time off.

Vacation pay is actually set at a higher level than regular pay, with an additional bonus of 30% paid on top of normal earnings. While this system may feel like a burden on the employer, it does ensure good work life balance in employees and can lead to higher employee satisfaction levels.

8. Lump sum death benefits

In the event of an employee death, lump sum death benefits which equal the pension the employee would have been paid had they retired on the day they died apply. These benefits can be paid out to dependents in equal shares, to provide for the employee’s partner, children, parents and young siblings.

9. Family allowance

Family allowance - Salário-Família - is offered to some Brazilian employees with children aged under 14, depending on the salary of the employee. Families must ensure their child or children have proper vaccinations and attend school to be eligible for this allowance.

10. Child daycare

Childcare is one area which is often covered by Collective Bargaining Agreements (CBAs). Because the terms offered depend on where negotiations land, the exact mechanic here can vary. One common option is for companies to pay 20% of statutory salary for parents with children under the age of 5, with the option to extend this age limit for parents of disabled children.

11. Basic food basket allowance

An unfamiliar concept in many countries, the basic food basket allowance is another common feature where benefits have been negotiated as part of a CBA. In this case, employees on a very low wage may be entitled to additional payments which are intended to cover the costs of day to day groceries. This benefit may be provided in the form of food vouchers or a rechargeable card which can then only be used for buying groceries in a store. To encourage use of this benefit, employers may be eligible for tax breaks where it’s offered to their employees.

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12. Leave entitlements in Brazil

On top of the 30 days of paid vacation which we covered earlier, there are a few other situations in which paid leave is mandatory for employees. These include:

• 120 days of maternity days for female employees
• 5 days of paternity leave for male employees
• 2 days of bereavement leave in the event of the death of a close relative

13. Statutory holidays in Brazil

Statutory holidays in Brazil can vary depending on your location, with 11 statutory holidays commonly observed. These holidays include both fixed dates, like Christmas, and moveable feasts like Carnival and Good Friday. On top of national holidays, there are also some state level holidays which vary based on where you do business.

14. Brazilian minimum wage

In 2024, the minimum wage in Brazil was 1,412 BRL per month. That’s about 230 USD at the time of research³. The Brazilian minimum wage is regularly re-assessed and may rise in future.

Non-mandatory Employee Benefits in Brazil

On top of the mandatory benefits which apply to some or all Brazilian employees, it is common for employers to make themselves more attractive to employees by offering supplementary benefits which can include the following.

1. Medical & dental care

Healthcare in Brazil is free, under the Sistema Único de Saúde - SUS - the national healthcare system. However, some employers may choose to offer supplemental medical and dental care through private providers to attract talent and ensure their workers are well looked after.

2. Flexible work schedule

An easy and productive way for employers to reward employees who work independently is to allow for flexible working arrangements, which let the employee set their own hours subject to management agreement. This is commonly used, and can mean big benefits for the employee without any real cost to the employer.

3. Meal voucher

Some employers choose to issue meal vouchers to their employees to allow them to buy their food during the working day for free. This will usually be done through a rechargeable card, and can offer some tax benefits for the employer.

4. Extended maternity and paternity leaves

Statutory maternity and paternity leave applies to all employees in Brazil, but employers may choose to increase this to improve employee work life balance and attract talent. This option is open to all employees, and would be set into employment contracts and working policies.

5. Family forming

Family forming policies are not as common as some other benefits, but can be used to support employees who are looking to start a family through adoption, surrogacy or fertility assistance. Where this benefit is used it applies to all employees without reference to their gender, marital status or sexual orientation, and can take the form of both financial and emotional support.

6. Education and training

It’s pretty common to offer employees in the knowledge economy opportunities for continuous professional development and training. This may be specific to the individual’s job, or may cover another subject such as language acquisition. Offering support - in the form of paying for classes or providing paid time off to study - can help keep employees up to date in their niche and also improve morale.

7. Home office allowance

As home working has increased significantly, so has the option of offering a home office allowance to allow a new employee to set up their workspace optimally. This is particularly common in tech companies and other businesses where working at home is common and requires specific equipment. Home office benefits may be a one off payment to set up the workspace at home, or may include monthly costs to cover services or co-working costs, depending on the individual’s needs.

8. Charity and volunteering

It’s common globally to offer employees benefits which support charitable giving. This is also an option in Brazil, where employees may be offered contribution matching if they give to a preferred charity, or paid time off to volunteer for example.

9. Gym memberships

Keeping your employees fit and healthy is good for everyone. Another commonly offered benefit in Brazil and globally sits around gym membership or other support to access fitness and training. If you have a physical office location you may have an on-site gym or deals with local gym services to allow employee access - or in some cases, employers might offer a monthly or annual benefit to cover the costs of buying a gym membership close to home.

10. Fuel allowance

Lower paid workers - as we have already seen - may be entitled to a transportation voucher. However, this is unlikely to apply to higher paid employees or people who commute by car, or need to travel regularly for work meetings and events. In this case, an employer might choose to offer a fuel allowance instead, to cover the costs of fuel and ensure employees are not out of pocket when they need to travel for work.

11. Wellness

Employers can choose to offer a very broad range of wellness benefits, which are often administered through third party outsourced providers. These may include access to counselling and therapy to support where an employee has personal issues, or may cover a broad range of services like access to yoga or meditation classes. Many workplaces also have a range of benefits which are low cost to the employer, but high benefits to the employee, such as no dress policies, free food in the office, and team bonding sessions.

12. Private pension

Employers wishing to remain competitive and attract highly talented individuals in Brazil are likely to offer a private pension to supplement the mandatory schemes. This can often mean that the employer pays a fixed percentage of the employee salary into a scheme and offers the employee the opportunity to add funds themselves.

13. Stock options

Particularly in tech and startup businesses, stock options are a common way to offer benefits to employees. Here, the level of benefit offered can vary a lot depending on the individual’s level in the organization, and the business itself.

Bonus: Additional Employee Benefits to Consider

As well as the 13th month payment which is usually mandatory, there’s nothing to stop employers offering additional bonuses which may be based on achievement or business success. These bonus payments would be set out in written policies so employees know what to expect.

1. Telephone costs

If you need to use a phone for your day to day work - for example when working from home or on the road - businesses will usually pick up the costs. This may be through issuing the employee a phone which is for work use only, and which is paid directly by the company, or by paying a fixed monthly amount to contribute to the costs of using a personal device.

2. Life insurance

Many Brazilian companies offer life insurance benefits which will pay out a fixed sum in the case of death in service. This would be in addition to any mandatory benefits which are provided through government insurance schemes.

3. Profit-sharing

Profit sharing is another method of rewarding employees in a motivational way, and can be especially popular in smaller and newer companies. In this case, there will be a contractual agreement as to the level of profits which are included in any sharing arrangements.

If you’re starting or expanding a business in Brazil, you’ll need to make sure you’re clear on all the local laws on benefits, as well as considering your value proposition to allow you to attract the right talent for your business. This guide covers some of the most important considerations - but getting individual support is important, so talking to experts in your niche in Brazil is also handy.

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Country Articles	Learn More About Employee Benefits
Australia	Employee Benefits in Australia: A Complete Guide
Singapore	Employee Benefits in Singapore: A Complete Guide
UK	Employee Benefits in UK: A Complete Guide
Brazil	Employee Benefits in Brazil: A Complete Guide
South Africa	Employee Benefits in South Africa: A Complete Guide
Spain	Employee Benefits in Spain: A Complete Guide

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Sources

1. INSS
2. ISSA - INSS profile
3. Statista - Brazil minimum wage