Employment Termination in Brazil: Complete 2024 Guide
Learn how to calculate severance pay in Brazil. Complete guide with formulas, deadlines, and rights by termination type. Free calculator included.
Employment termination is the end of the employment contract between employee and employer, guaranteeing the worker the right to receive various severance payments as provided by CLT (Brazil’s labor law). The total termination amount varies significantly depending on the type of dismissal and length of service.
Understanding your termination rights is essential to avoid financial losses. In 2024, the rules remain the same as those from the 2017 labor reform, with specific calculations for each situation.
What is employment termination
Definition and importance
Employment termination is the legal process that ends the employment relationship, ensuring the worker receives payment of all amounts due. This procedure must strictly follow CLT (labor law) standards to be valid.
The employment settlement includes amounts proportional to time worked, vacation pay, 13th salary bonus, and other payments according to the type of dismissal.
Types of termination
There are different termination modalities, each with specific rights:
- Dismissal without cause: Employer dismisses employee without serious reason
- Dismissal with cause: Dismissal due to employee’s serious misconduct
- Resignation: Employee requests termination
- Indirect dismissal: Employee resigns due to employer’s breach of contract
- Mutual agreement: Consensus between parties (Law 13.467/2017)
- Fixed-term contract expiration: Natural end of contract period
Worker rights by type
Each modality guarantees different payments. In dismissal without cause, the worker is entitled to all severance payments. In resignation, they lose compensated prior notice and cannot withdraw FGTS (severance fund).
Mutual agreement allows withdrawal of 80% of FGTS and half of the 40% penalty, being an interesting alternative in many cases.
Mandatory severance payments
Salary balance
The salary balance corresponds to days worked in the termination month that have not yet been paid. The calculation is proportional: monthly salary ÷ 30 days × days worked.
Example: Salary R$ 3,000, worked 15 days → R$ 3,000 ÷ 30 × 15 = R$ 1,500
Proportional and accrued vacation
Accrued vacation refers to complete acquisition periods not taken, paid with a 1/3 constitutional bonus. Proportional vacation is calculated by months worked in the current acquisition period.
Proportional vacation calculation:
- Salary ÷ 12 × months worked × 1.333 (already includes 1/3)
- A month is considered complete when 15 days or more are worked
Example: Salary R$ 3,000, 8 months worked → R$ 3,000 ÷ 12 × 8 × 1.333 = R$ 2,666
Proportional 13th salary
The proportional 13th salary is calculated by months worked in the termination year. A month is considered complete from 15 days worked.
Formula: Highest salary of the year ÷ 12 × months worked
Example: Highest salary R$ 3,200, 9 months → R$ 3,200 ÷ 12 × 9 = R$ 2,400
Prior notice
Prior notice can be worked or compensated. In dismissal without cause, the employer must give 30 base days + 3 days per year worked (maximum 90 days total).
In resignation, the employee must fulfill the notice or compensate the employer.
Compensated prior notice calculation:
- 30 base days + (3 days × complete years of work)
- Amount: salary ÷ 30 × prior notice days
FGTS and penalty
The FGTS (severance fund) balance includes monthly deposits of 8% on gross salary plus earnings. In dismissal without cause, the employer pays a 40% penalty on the total balance.
Right to withdraw FGTS according to termination type:
- Dismissal without cause: Full withdrawal + 40% penalty
- Resignation: No withdrawal rights
- Mutual agreement: 80% withdrawal + 20% penalty
How to calculate termination step by step
General calculation method
To calculate termination correctly, follow this sequence:
- Identify the termination type and corresponding rights
- Calculate each payment separately using specific formulas
- Add all amounts to get the gross total
- Apply deductions (INSS - social security, IRPF - income tax if applicable)
- Calculate the net amount to receive
Practical example - dismissal without cause
Employee with 2 years of work, current salary R$ 3,500, dismissed on 06/15/2024:
Payments due:
- Salary balance (15 days): R$ 1,750
- Accrued vacation + 1/3: R$ 4,667
- Proportional vacation (6 months): R$ 1,556
- Proportional 13th (6 months): R$ 1,750
- Prior notice (36 days): R$ 4,200
- Gross total: R$ 13,923
INSS deductions: R$ 1,237 (11% on R$ 11,249.40) Net amount: R$ 12,686
Detailed calculation of each payment
| Payment | Formula | Example (R$ 3,500) |
|---|---|---|
| Salary balance | Salary ÷ 30 × days | R$ 1,750 (15 days) |
| Vacation + 1/3 | Salary × 1.333 | R$ 4,667 |
| Proportional 13th | Salary ÷ 12 × months | R$ 1,750 (6 months) |
| Prior notice | Salary ÷ 30 × days | R$ 4,200 (36 days) |
Use our termination calculator to get automated and accurate calculation of all amounts.
Payment deadlines
Legal deadlines by modality
Payment deadlines for termination are strict and vary by type:
- Prior notice worked: Until the 1st business day after completion
- Compensated prior notice: Until the 10th calendar day after dismissal
- Resignation: Until the next 1st business day
- Fixed-term contract termination: Until the 1st business day after expiration
Late payment penalties
Failure to meet deadlines generates a penalty equivalent to the employee’s salary, paid in favor of the worker. This penalty is automatic and doesn’t depend on proof of damages.
Mandatory documents
The employer must deliver upon termination:
- TRCT (Employment Contract Termination Term)
- Work card with termination recorded
- FGTS keys for withdrawal
- Unemployment insurance form (if applicable)
- Exit medical exam (within 10 days after termination)
Automatic termination calculator
Simplify your calculations
Calculating termination manually is complex and error-prone. Our termination calculator automates the entire process, considering:
- All termination types and their particularities
- Accurate calculation of each severance payment
- Updated deductions for INSS and IRPF 2024
- FGTS amounts and applicable penalties
How to use the calculator
The process is simple and fast:
- Select the termination type from the menu
- Enter basic data: salary, hiring date, termination date
- Add specific information: accrued vacation, previous 13th salary
- Get the detailed result of all payments
The tool generates a complete statement that can be used to verify the company’s calculation or negotiate discrepant amounts.
Frequently Asked Questions
What’s the termination amount for someone with 2 years at the company?
The amount depends on salary and termination type. For dismissal without cause with R$ 3,000 salary, the net amount is approximately R$ 10,500 to R$ 12,000, including all payments and legal deductions.
How to calculate proportional vacation upon termination?
Divide the salary by 12, multiply by months worked in the current acquisition period, then multiply by 1.333 to include the constitutional third. Months with 15 days or more count as a complete month.
When am I not entitled to FGTS upon termination?
In resignation you cannot withdraw FGTS, but deposits remain in the account. In mutual agreement you can withdraw 80% of the balance. Only in dismissal with cause do you permanently lose withdrawal rights.
What’s the difference between dismissal and mutual agreement?
In mutual agreement you receive 50% of prior notice, 50% of FGTS penalty (20%) and can withdraw 80% of the FGTS balance. It’s advantageous when dismissal without cause isn’t possible and you want to access FGTS.
How long should I receive my termination payment?
Compensated prior notice: within 10 calendar days. Prior notice worked: until the 1st business day after completion. Resignation: until the next 1st business day. Delays generate a penalty of one salary in favor of the worker.
How does INSS deduction work in termination?
INSS applies to salary-nature payments (balance, vacation, 13th, prior notice) up to the ceiling of R$ 7,786.02 in 2024. The rate varies from 7.5% to 14% according to salary bracket. FGTS and its penalties are not subject to deduction.
Can I verify if the company’s calculation is correct?
Yes, use our termination calculator to check all amounts. Compare the generated statement with the company’s TRCT. Discrepancies can be questioned and you’re entitled to the correct amount according to CLT.