How do I calculate a termination fee? See this step-by-step guide!

Every employee who works under the CLT regime is entitled to FGTS upon termination, but do you know how to calculate the termination fine?

Therefore, we have prepared comprehensive content where you will find the answer to this question and also learn all the details about the termination fee.

Although it is a very common topic within HR departments in companies, it still raises some questions among employees.

For example, the payment term, percentages and how to correctly know the amount to be received.

So, keep reading and find out everything you need to know about how to calculate the termination fee.

What is a termination fine?

When talking about termination fines, we cannot fail to mention the FGTS (Service Time Guarantee Fund).

Therefore, as the name suggests, the FGTS is a fund where the employer deposits the amount corresponding to 8% of the employee's salary monthly.

The FGTS aims to serve as financial support in the event that an employee is dismissed without just cause or in a labor agreement.

However, the FGTS fine is an amount that the company must pay to an employee who is dismissed without just cause.

The value of this fine is 40% on the value of the balance of the worker's FGTS account, this percentage will be calculated on the total amount deposited throughout the period of work.

In short, the FGTS is the total amount corresponding to the amounts deposited by the company during the time worked.

And the termination fine is 40% of the total FGTS amount, which must be paid by the company.

Simple, isn't it?

Something interesting to note is that this fine was instituted in 1960, however it only came into effect in the 1990s, with the intention of reducing layoffs in companies.

Therefore, before explaining how to calculate the termination fine, let's talk about when the employee should receive the termination fine.

When should the worker receive the termination fine?

The worker will be entitled to receive the termination fine in two specific cases: when he is dismissed without just cause or when the dismissal is by mutual agreement.

• Dismissal without just cause: It happens when an employee is dismissed from the company without any reason outside of the contract, that is, without there being any problem with the company.
• Dismissal by mutual agreement: This type of dismissal occurs when the employer and employee reach an agreement regarding the termination of employment. However, in this type of dismissal, the termination fine will be 20% and only 80% will be withdrawn from the FGTS.

It is worth remembering that dismissal by mutual agreement was carried out without legal support until 2017, but after the labor reform, this termination model is now legally in force.

Therefore, be aware of the differences when calculating the termination fine, as this will depend on the termination model applied.

Who can receive the termination fee?

It is important for you to know that there are some categories of workers who are entitled to receive the termination fine.

Therefore, all employees who work under the CLT regime have the right to receive the termination fine, in accordance with the laws provided for in labor legislation.

But workers such as domestic workers, temporary workers, rural workers, intermittent workers, professional athletes, among others, also fall into this category.

How to calculate termination fine?

As mentioned above, to calculate the termination fine, you will need to take into account the total amount of your FGTS deposited by your employer throughout your employment.

And don't forget that to make the correct calculation you will need to know exactly what type of dismissal you fall into.

Since in the case of dismissal without just cause the amount will be 40% and in the case of a consensual agreement 20%.

It is worth remembering that throughout their professional life, a CLT worker may have more than one FGTS account, since a new account is opened for each new company you work for.

However, when calculating the termination fine, you must do so based on the amount linked to the company you are leaving.

Therefore, we will take a step-by-step guide so that you can better understand how to calculate the termination fee.

Step by step guide on how to calculate termination fines

• Have access to the total FGTS amount related to the current account in the contract.

You can access your FGTS statement from the company or through FGTS application;

• Next, you will need to know what type of dismissal you are subject to, whether without just cause or by mutual agreement (consensual).
• Once you have this data in hand, simply calculate 40% for dismissal without just cause or 20% for dismissal by labor agreement.

Let's look at a practical example:

• Dismissal without just cause

Let's assume that your FGTS balance is R$ 5,000.00. This way the calculation will be 5,000.00 x 40% (0.4) = R$ 2,000.00.

Therefore, the value of the termination fine will be R$ 2,000.00.

• Dismissal by labor agreement

Let's assume that your FGTS balance is R$ 5,000.00. This way the calculation will be 5,000.00 x 20% (0.2) = R$ 1,000.00.

 Therefore, the value of the termination fine will be R$ 1,000.00

And that's it! Now you know how to calculate the termination fee. Simple, right?

However, there are some occasions in which the employee loses the right to receive the termination fee, and we will tell you what they are.

When does the worker lose the right to receive the termination fine?

There are some cases of dismissal that can cause the employee to lose the right to receive the severance pay, which are:

• Dismissal for just cause, which is nothing more than dismissal due to a breach of contract or extreme situation on the part of the employee.
• Resignation, in this case it is the employee who requests to leave the company without there being an agreement between the parties.

But another very important question is about the anniversary withdrawal, many people still have doubts about whether they lose the right to the termination fee if they choose this modality.

Do I lose the right to a termination fee if I opt for the anniversary withdrawal?

THE birthday withdrawal is a modality which employees can request in the FGTS app, website or Caixa branches.

This option allows the worker to withdraw part of the available amount of their FGTS annually in the month of their birthday.

However, this option does not deprive the worker of the right to receive the termination fine, but it will influence when withdrawing the total amount of the FGTS.

In how many days must the company pay?

When it comes to severance pay rules, the rule is the same for all amounts that must be paid to the employee.

Therefore, by law, the company must comply with the deadline of up to 10 days from the end of the contract to honor the payment of the termination fine.

How to withdraw the termination fine?

The calculated value of the termination fine will be deposited into the FGTS account linked to the employment contract that is being canceled.

Therefore, if there is no specific account already registered, you can transfer the amount to any bank through the FGTS app itself.

Withdrawals can still be made through ATMs and Caixa branches using the Citizen Card.

It's worth remembering that the funds will be available within 10 days, so it's important that you maintain financial control so you don't get into trouble during this time.

That's why we'll give you some tips on personal finances so you can handle terminations a little better.

How to maintain financial control?

We know that being fired is not usually a very pleasant experience, and it can often catch the worker off guard.

Therefore, be aware of some factors that can help you, especially during termination.

Depending on your length of service, the amounts related to severance pay and FGTS can be high, but don't be fooled.

It is worth remembering that these values are to insure the worker during the time he or she is unemployed.

• Save or invest part of the amount of the termination fine or FGTS;
• Create a financial reserve, if not all of it, then part of the severance pay;
• Pay off accumulated debts;
• Invest in courses and professional development for new opportunities;
• Make a venture.

It's important that when using your termination fee and other amounts related to termination, you think carefully, do your research, and plan.

This way, you'll be able to keep your finances organized until you can earn another income. So take advantage of the opportunities!

Conclusion

When you are fired without just cause or due to a labor agreement, be aware of your rights, and now that you know how to calculate the termination fee, it will be even easier.

Knowing your rights is never a bad idea and also helps you better organize your finances.

Therefore, be sure to calculate your termination fee and then put our tips on organizing your personal finances into practice to be prepared to deal with the termination of your contract.

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