Brazil Ministry of Labor issues new guidelines for worker credit discounts

The Ministry of Labor and Employment (MTE) released temporary procedures for employers to deduct installments of the Worker Credit (Crédito do Trabalhador) from severance payments during the transition to the program’s new guarantee feature. For dismissals between 26 June and 22 July 2026, companies should continue deducting the monthly loan portion within the legal 35% limit of the severance amount. From 23 July 2026 onward, the new rules in Portaria MTE No 1.115/2026 apply, regulating the use of FGTS balances and termination fines as guarantees for the credit.

The measure aims to expand credit availability, boost competition among banks and lower interest rates, which can be limited to 1.99% per month. Guarantees are optional and can cover up to 35% of severance, 100% of the FGTS termination fine, and up to 10% of the FGTS balance for workers who opted for the termination‑withdrawal model. Employers, HR professionals and accountants are urged to update the eSocial, FGTSDigital and Worker Credit platforms before processing terminations to avoid miscalculations and potential labor liabilities.