This Wednesday (18), President Luiz Inácio Lula da Silva (Workers’ Party) signed an ordinance creating a working group involving many ministries to study a policy to value the minimum wage. The group will work for 45 days. Activities may be extended for the same period.
The ordinance was signed during a ceremony at the Planalto Palace with representatives of Brazil’s trade unions. That was the first time, after six years, trade unionists were received at the palace.
The resumption of a policy to value the minimum wage, which was ended by former President Jair Bolsonaro (Liberal Party), is one of Lula’s campaign promises. In his previous presidential mandates, Lula created a rule to calculate the readjustment of the national wage floor to grant increases always above accumulated inflation – that is, real salary increases.
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The creation of a policy to value the minimum wage was the result of pressure from trade unions on the government. It guaranteed that the wage floor was readjusted based on inflation plus the Gross Domestic Product (GDP) growth percentage of the previous year.
Trade unions expect that a similar formula be adopted.
Lula said the new proposal will be discussed with trade unionists and emphasized that the intention to guarantee a real increase in the minimum wage is “the best way to distribute income in the country.”
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The president recalled that, during the military dictatorship, Brazil’s economy grew by 14 percent. Even though, workers became poorer. This happened because the growth was not distributed as a real salary increase.
According to Labor Minister Luiz Marinho (Workers' Party), the minimum wage amount will remain the same, 1,302 reais (250 US dollars), until the working group has completed its study. This contradicts claims by the trade unions, which advocated for 1,342 reais (259 US dollars). It also opposes the promise of the government, which asked for the approval of the so-called Proposal on Transition Constitution Amendment (PEC da Transição, in Portuguese) to raise the floor to R$ 1,320.
Trade unions and apps
Marinho also announced that, within 30 days, two other new working groups would be created. One of them will discuss the appreciation of trade unions’ role in collective negotiations. The other will focus on the regularization of work mediated by digital platforms and apps.
“We understand the angst of people who work 16 hours a day to make ends meet. It is almost slave labor,” said Marinho, referring to delivery workers. “Who protects these workers? That’s an issue we need to solve.”
Lula said that the government intends to build a new union policy tailored to the current reality of the world of work. “It will be different from the policy seen in the 80s because the world of work has changed a lot.”
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The president highlighted that trade unions are important in all democracies and that it is necessary to seek alternatives for the financial sustainability of entities. Furthermore, he criticized aspects of labor reform that compromised this.
“Taking away from workers the right to decide on the contribution [to unions] was a crime,” stated Lula.
President of Força Sindical (Union Strength, in a rough translation to English) Miguel Torres, had complained about this issue in a speech before Lula's. However, Torres highlighted that trade unionists do not want the return of the Trade Union Tax, which was eliminated by the labor reform.
Acham que o mundo moderno não precisa de sindicatos. Mas a democracia, quanto mais forte, mais precisa de sindicatos. Para representar os desejos dos trabalhadores.
— Lula (@LulaOficial) January 18, 2023
Twet: “[People] Think the modern world does not need trade unions. But the stronger a democracy is, the more it needs unions to represent workers' wishes.”
Tax reform
Lula also stated that he will work, this semester, to approve the Tax Reform that is currently being discussed in Congress. He also promised that he will work to change some aspects of the Income Tax.
“Workers who earn 3,000 reais (580 US dollars) per month pay more [income tax]. We need to change this logic,” said Lula.
Lula’s speech was applauded by trade unionists, who filled the palace’s hall. Before the president, all the presidents of trade unions spoke. Oswaldo Augusto de Barros, from the Brazilian trade union Nova Central Sindical de Trabalhadores (NCST, in Portuguese), stated that Lula's return to the Presidency represents the “return of dialogue” with workers.
