Composition of Gross Termination Benefits
Gross vs. Net Comparison
Detailed Breakdown of Benefits and Deductions
| Benefit/Deduction Description | Credit Amount (+) | Deduction Amount (-) | Incidence Type |
|---|
Calculate the estimated termination benefits of your employment contract under CLT. Simulate the balance of salary, prior notice, accrued and proportional vacation/paid leave with constitutional third, as well as the severance fund (FGTS) penalty and official social security (INSS) and withholding income tax (IRRF) deductions.
| Benefit/Deduction Description | Credit Amount (+) | Deduction Amount (-) | Incidence Type |
|---|
The termination of an employment contract under CLT generates the right to receive a series of termination benefits, called termination benefits. The exact rights depend directly on who initiated the termination and the reasons involved.
The termination benefits vary widely depending on the reason for the termination:
| Labor Law | Without Just Cause | Resignation | With Just Cause | Mutual Agreement |
|---|---|---|---|---|
| Salary Balance | ✅ Yes | ✅ Yes | ✅ Yes | ✅ Yes |
| Proportional 13th Salary | ✅ Yes | ✅ Yes | ❌ No | ✅ Yes (50% of notice if compensated) |
| Proportional Vacation/Paid Leave + 1/3 | ✅ Yes | ✅ Yes | ❌ No | ✅ Yes |
| Accrued Vacation/Paid Leave + 1/3 | ✅ Yes | ✅ Yes | ✅ Yes | ✅ Yes |
| Prior Notice | ✅ Paid by standard | ⚠️ Deducted if not worked | ❌ No | ✅ Half if compensated (50%) |
| Severance Fund (FGTS) Penalty | ✅ 40% | ❌ No | ❌ No | ✅ 20% |
| Severance Fund (FGTS) Withdrawal / Unemployment Insurance | ✅ Yes | ❌ No | ❌ No | ⚠️ Only 80% of balance / No Unemployment Insurance |
Not all termination benefits are taxable. The Withholding Income Tax (IRRF) and social security contribution (INSS) only apply to benefits of a salary nature (such as Salary Balance and Proportional 13th Salary). All indemnity benefits (Compensated Prior Notice, Indemnified Accrued and Proportional Vacation/Paid Leave, Vacation Third, and the Severance Fund (FGTS) Penalty) are exempt from social security and tax withholding.
According to the Labor Reform (Law 13,467/2017), the deadline for the company to make the termination payment and homologate the termination is up to 10 consecutive days, counted from the date of termination of the employment contract, regardless of the type of prior notice (worked or compensated). Non-compliance generates a fine equal to one month's salary in favor of the employee (Article 477 of CLT).
The proportional prior notice (Law 12,506/2011) guarantees that the worker has the right to 30 days of prior notice for contracts of up to 1 year of service in the company. From the first year completed, 3 more days of notice are added for each year of service completed, up to a maximum limit of 60 additional days (totaling 90 days of notice for those with 20 or more years of service in the company).
If the worker initiates the resignation and decides not to fulfill the required prior notice days, the company has the legal right to deduct the amount corresponding to one month's salary directly from the calculation of the termination benefits, unless there is an express waiver by the employer.