Article
4 min read
Employer Costs for an Employee in Brazil (2026 Guide)
Employer of record
Global hiring
Author
Jemima Owen-Jones
Last Update
February 04, 2026
Quick answer: What is the total employer cost for a $100,000 salary in Brazil?
For an employee earning $100,000 USD annually in Brazil, employers can expect mandatory employer costs of approximately $174,856 USD per year, bringing total compensation costs to $274,856 USD.
Estimated total employer cost (Brazil): ~174.9% on top of gross salary (example estimate).
Hiring in Brazil can be a great way to access talent in Latin America—whether you’re expanding into the region, building a remote team, or hiring your ideal candidate locally.
But even when two employees earn the same salary, the total employer cost varies by country due to different statutory contributions, payroll rules, and mandatory benefits.
This guide provides a ballpark estimate of the mandatory employer cost of hiring an employee in Brazil, using an example salary of $100,000 USD per year.
What’s included in this estimate?
This estimate includes mandatory employer-side statutory costs that may apply when hiring an employee in Brazil, such as:
- FGTS contribution (Guarantee Fund for Time of Service)
- Company social security contribution
- Mandatory salary-related benefits (e.g., 13th salary)
- Vacation bonus (where applicable)
- Meal voucher allowance (commonly required/expected in practice)
- Life insurance (where applicable)
- CBA/union-related bonus or profit sharing (where applicable)
What’s not included in this estimate?
This estimate generally does not include additional costs such as:
- Additional employer-provided benefits beyond those listed
- Bonuses, equity, or commissions (outside statutory/CBA requirements)
- Equipment and onboarding expenses
- Private health insurance (if offered as an additional benefit)
- Costs that vary by employee role, location, or collective bargaining rules
- Currency conversion fluctuations beyond the example salary
Why employer costs vary in Brazil (and globally)
Employer costs can differ depending on:
- Whether benefits are mandatory by law vs required by collective agreements
- Employee classification and contract type
- Industry-specific rules and union agreements
- Salary thresholds and contribution rates
- Changes in regulation year to year
- Currency exchange rate fluctuations (if you pay in a different base currency)
Estimated employer cost breakdown for Brazil
Below is an estimated breakdown of mandatory employer costs for hiring an employee in Brazil earning $100,000 USD/year.
Example salary used in this estimate
- Annual gross salary: $100,000 USD
- Annual gross salary (approx.): R$ 617,300 BRL
Employer mandatory costs (estimated)
| Employer Cost Category | Estimated Annual Cost (BRL) | Estimated Annual Cost (USD) | Notes |
|---|---|---|---|
| FGTS Contribution | R$ 49,384 | $8,000 | Mandatory employee protection fund |
| Company Social Security Contribution | R$ 177,782 | $28,800 | Social security programs (retirement, welfare, etc.) |
| Meal Voucher | R$ 10,560 | $1,711 | Allowance to cover meals during working hours |
| Life Insurance | R$ 67 | $11 | Insurance coverage (where applicable) |
| 13th salary | R$ 100,000 | $100,000 | Mandatory additional salary payment |
| CBA/Union Bonus (Profit Sharing) | R$ 3,786 | $3,786 | May apply based on union/CBA requirements |
| Vacation Bonus | R$ 32,548 | $32,548 | Additional vacation-related payment |
| Total Estimated Employer Costs | R$ 374,127 | $174,856 | Total mandatory employer cost estimate |
Total compensation cost (salary + mandatory employer costs)
| Total | BRL | USD |
|---|---|---|
| Gross Salary | R$ 617,300 | $100,000 |
| Mandatory Employer Costs | R$ 374,127 | $174,856 |
| Total Compensation Cost | R$ 991,427 | $274,856 |
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FAQs
How much do employees receive in Brazil compared to base salaries?
What employees receive in Brazil can differ from base salaries because compensation often includes mandatory additions like the 13th salary, plus other benefits required under Brazilian labor laws. This means employers typically budget beyond the employee’s base pay.
What are employer contributions in Brazil?
Employer contributions in Brazil often include mandatory payments such as social security contributions and deposits into the FGTS severance fund. These costs are paid by the employer in addition to the employee’s salary and can significantly increase total employment cost.
What is the FGTS severance fund in Brazil?
The FGTS severance fund (Fundo de Garantia do Tempo de Serviço) is a mandatory employer-funded savings account for the employee. It provides financial protection in cases like termination, retirement, or other qualifying situations and is a key statutory employer cost in Brazil.
Is the 13th salary mandatory in Brazil?
Yes. Under Brazilian labor laws, the 13th salary is a mandatory additional salary payment. It is typically paid annually (often split across the year), and employers should account for it when calculating total compensation.
How does monthly salary work in Brazil?
In Brazil, employees are usually paid a monthly salary, but total annual cost to the employer can include additional mandatory payments beyond the monthly base amount—such as the 13th salary and vacation-related payments.
How many days of paid vacation do employees get in Brazil?
Employees are generally entitled to 30 days of paid vacation per year under Brazilian labor laws. Employers should factor these days of paid vacation into total compensation planning.
When do employees qualify for vacation in Brazil?
In many cases, employees earn vacation after 12 months of work. This means vacation entitlement typically accrues over the first year of employment, and employers may need to plan for paid leave and related costs once eligibility is reached.
What is paid annual leave in Brazil and how does it affect employer costs?
Paid annual leave in Brazil includes the employee’s paid vacation period and may also include additional vacation-related payments required by law or collective agreements. This increases the true cost of employment beyond base salary.
Is paid sick leave required in Brazil?
Yes, paid sick leave can apply in Brazil depending on the length of absence and applicable rules. Employers may have wage obligations during illness, and longer absences can involve additional processes and statutory requirements.
Do employers pay income tax for employees in Brazil?
Typically, income tax is paid by the employee, but employers are responsible for withholding and remitting the correct amounts through payroll. This makes tax compliance and payroll accuracy essential even if the employer isn’t directly paying the employee’s income tax.
What taxes and benefits affect employer costs in Brazil?
Employer costs in Brazil are shaped by mandatory payroll taxes benefits requirements, including statutory contributions and legally required benefits (like FGTS and the 13th salary). The exact total depends on salary level, employee classification, and applicable agreements.
What should an employment contract include in Brazil?
A compliant employment contract in Brazil should clearly define base salary, monthly salary terms, working hours, benefits, leave entitlements, and termination rules. Strong contracts help support compliance with Brazilian labor laws and reduce legal risk.
Jemima is a nomadic writer, journalist, and digital marketer with a decade of experience crafting compelling B2B content for a global audience. She is a strong advocate for equal opportunities and is dedicated to shaping the future of work. At Deel, she specializes in thought-leadership content covering global mobility, cross-border compliance, and workplace culture topics.
