What should HR know to pay employees’ FGTS correctly?

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What should HR know to pay employees' FGTS correctly?

Table of Contents

The acronym FGTS means Time of Service Guarantee Fund and refers to an account at Caixa Econômica Federal opened by the company, aimed at workers. It works like a savings account, where every month, 8% of the person's gross salary is deposited. In the case of apprenticeship contracts, the rate is now equivalent to 2%.

This right was guaranteed by the federal Constitution to all workers hired by the regime CLT by law No. 5,107, in 1966. Since that date, every employer has an obligation to open an account in the name of each of its employees and make monthly deposits.

The objective of the FGTS it is to serve as a protection for employees in difficult times. As an unfair dismissal and also for the realization of the dream of home ownership.

As every employee registered under the CLT regime has this benefit, the role of HR to carry out its management is fundamental. The Human Resources team must be prepared and know how to manage all termination processes, in order to avoid labor lawsuits against the company.

What is the role of HR in FGTS management?

HR professionals must always be up to date on the legal requirements of their company regarding their employees.

There are a number of issues involving the subject that HR professionals should know about. Such as employees' rights and duties, payment terms and situations in which it is allowed to withdraw the benefit.

Follow below what they are:

1. How does the employee contribute?

Payment must be made at the beginning of each month, until the seventh day of the month following the one worked. The amount is deposited in the account linked to the employment contract at Federal Savings Bank.

If the company does not follow the maturity date, it is necessary to correct the amount. FGTS accounts are updated every 10 days according to the law 8.036 / 90.

2. Which employees are entitled to FGTS?

Any professional who has his work card registered. Be rural, temporary, loose, domestic, intermittent workers, among others.

There are some cases where, even if the employee is away from his job, it is his right to receive the FGTS monthly deposit. As in the cases of leave due to:

  • Compulsory military service;
  • Vacation enjoyment;
  • Maternity and paternity leave;
  • Work accident leave;
  • Health treatment license (in the first 30 days);
  • Exercise of the position of immediate trust of the employer;
  • And other cases in which the absence is paid.

3. In what situations can the employee use the FGTS?

The main use of FGTS is related to dismissals without just cause. But, there are other cases in which the employee will be able to withdraw his fund. Are they:

  • Retirement, or if the worker turns 70 or over;
  • Extinction of employment contract for a specified period;
  • Upon termination of the contract due to total or partial extinction of the company;
  • In case of natural disasters. Like floods, in which the worker goes through some emergency situation or state of calamity and is thus recognized by the ordinance of the Federal government;
  • When the worker dies and the company closes;
  • In home financing (for this case, it is necessary that the employee has contributed for at least three years);
  • If there is no deposit in the account for three years in a row;
  • When the worker or his dependent is in a terminal stage, due to some serious illness.

4. What is an inactive FGTS account?

An account becomes inactive when it stops receiving deposits and can happen in cases where the employee resigns or is fired for cause.

However, even though it is inactive, it is a worker's right and continues to receive interest and monetary restatement on his balance.

The withdrawal of inactive accounts remains in force for workers who have suffered serious illnesses or been in prison and were unable to withdraw in 2017. The deadline for these employees to withdraw is on the day December 31 of this year. It is necessary to present a medical certificate or certificate of imprisonment to receive the benefit.

5. What are the mistakes made by companies in payment?

Often, poor payroll management by HR can result in non-payment of FGTS to employees. This often happens with inactive accounts. When this occurs, the company must make all payments with fines and interest.

In addition, it is subject to labor liabilities, because employees can use the Ministry of Labour to compel employers to make the corrected payment of amounts.

6. How to organize payment to avoid problems?

In order for the company not to have any kind of problem regarding the payment of FGTS, HR must keep all employee information and payrolls up to date.

Any payroll error, whether typing or using the wrong formula can damage the entire process. Thus, the use of management software can facilitate the routine of the HR department.

Through HR Consultant UK platform, your company's HR will be able to manage all employee data securely and without the need for control spreadsheets. Thus, all payments and collections will be monitored and made up to date.

FGTS on the 13th salary and on vacation

The FGTS payment also applies to the amount of the 13th salary, both in the first and second installments. Thus, the company must calculate the 8% of the total remuneration for the months in which the two installments are paid.

To vacation, the same principle is applied. The 8% is related to the total remuneration that the employee will receive during his vacation, that is, salary balance + vacation + 1/3 vacation).

However, there are cases in which FGTS incidence may not occur, such as double vacations or a cash bonus.

Termination fine

When calculating contract termination, it is still necessary to consider the payment of the fine. It consists of the total amount that the company must deposit in the FGTS account of the employee who was dismissed without just cause, or in situations of indirect terminations.

The fine is 40% of all FGTS deposits made during the term of the employment contract, with all due inflation adjustments and interest.

In addition, the company must still deposit the FGTS amounts of the month in which the termination occurred and the previous month that has not yet been paid into the employee's account.

For cases where there has been dismissal due to reciprocal fault or force majeure, the amount of the severance penalty drops to 20%.

Social contribution

The company must still deposit the Social contribution in the FGTS account of the employee dismissed without just cause, or in the case of indirect dismissals.

The Social Contribution is an amount equal to 10% of all FGTS deposits made during the term of employment of the terminated employee.

The role of HR to control all FGTS payments and collections is fundamental. This prevents the company from suffering labor claims in the future and from having financial losses. Have you ever stopped to think if your company needs to make payments that have been forgotten? And bear interest and fines after several years? There is no point in taking that risk!

Still have any questions about how to pay your employees' FGTS? Leave your question in the comments.



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