The FGTS (Fundo de Garantia por Tempo de Serviço) is an important tool for the protection of Brazilian workers with formal employment relationships. Managed by the federal government, the FGTS consists of monthly deposits made by employers on behalf of their employees.
The main advantage of this fund is the formation of a financial resource that can be used by the worker in various situations throughout their career and personal life.
What is the FGTS and how does it work?
Created in the 1960s, the FGTS aims to protect workers who are dismissed without just cause, through an account linked to the employment contract. The employer deposits, monthly, the equivalent of 8% of the employee’s salary into this account, which is managed by Caixa Econômica Federal.
FGTS resources can be used in cases of unjustified dismissal, acquisition of home ownership, retirement, and other situations that we will see below.
Main situations for using the FGTS
The FGTS is not just insurance for dismissal. There are several other situations in which the worker can make use of this resource. Some of the main uses include:
– Purchase or payment of own property;
– Amortization or liquidation of debt associated with home financing;
– Aid in retirement;
– Withdrawal in case of serious illnesses, such as cancer or AIDS, or in terminal condition;
– Withdrawal for payment of higher education or essential surgeries.
How to withdraw the FGTS?
To withdraw the FGTS, the worker must meet some specific conditions, such as being outside the FGTS system for a minimum of three uninterrupted years when retiring, or having a serious illness. For other cases, there are the following withdrawal modalities:
– Rescission Withdrawal: occurs when the worker is dismissed without just cause;
– Anniversary Withdrawal: allows the worker to withdraw part of the FGTS balance annually in the month of their birthday.
Get to know the Anniversary Withdrawal Modality
The Anniversary Withdrawal modality was introduced in 2019, allowing workers to make annual withdrawals of part of the balance in their accounts, with values depending on the balance ranges they have.
However, it is important to note that by opting for this modality, the worker loses the right to full severance pay in case of unjustified dismissal, receiving only the 40% fine on the deposits.
In conclusion, the FGTS is a very important right for Brazilian workers, providing financial security in critical moments. It is essential to be informed about the rules and modifications of the fund to maximize the benefits it can offer.
