Brazil has relaxed FGTS withdrawal rules, potentially releasing 12 billion reais to 12 million workers. Dismissed workers from January 2020 can access their remaining funds, despite previously opting for annual withdrawals. The payments are expected to begin in March.
On Friday, Brazil’s government issued an executive order to temporarily relax regulations regarding the disbursement of the FGTS, or workers’ severance fund. This change is expected to enable approximately 12 million workers to access nearly 12 billion reais (approximately $2.04 billion) from their accounts.
Previously, a law enacted in 2019 permitted formal workers to withdraw a portion of their FGTS balance annually during their birthday month. However, opting for this withdrawal limited their rights to access the remaining balance in case of dismissal; full withdrawal privileges would only be restored after 24 months.
The current executive order, announced by President Luiz Inacio Lula da Silva’s administration, allows workers dismissed between January 2020 and the present to withdraw their remaining FGTS balance, regardless of previous withdrawals. The government has indicated that these payments are scheduled to commence in March.
In summary, Brazil’s recent measures to relax FGTS withdrawal rules will provide significant financial relief to millions of workers impacted by earlier restrictions. This change aims to enhance worker support amid economic challenges, allowing greater access to severance funds while maintaining a focus on worker rights. The rollout of these payments is set to begin in March.
Original Source: money.usnews.com
