Will a retrospective review of the FGTS lead to increased payments to workers? understands!

Right now, the FGTS correction hurts workers more than it helps them. Therefore, the correction rule may change.

The issue of correcting the FGTS has been a subject of debate in recent years, especially with regard to the application of inflation indicators that guarantee the purchasing power of workers.

In June of this year, the Federal Supreme Court issued a decision that directly affected the correction calculation, but its impact was limited to the future only. In other words, the benefits should only accrue over time.

Through appeal, the Solidariedade party seeks to expand this decision, ensuring that the correction of the Fund for Termination Benefits (FGTS) also includes retrospective values, which will benefit many workers who have suffered losses due to the lag in the indicators used.

How does the FGTS account work nowadays?

Currently, the FGTS is corrected through a formula that combines the reference rate (TR) with an annual interest of 3%, in addition to the distribution of a portion of the profits earned by the fund.

the TRCreated in the 1990s, it initially served to control inflation, but its value remained well below real inflation rates. This led to a delay in the purchasing power of the amounts accumulated in FGTS accounts, as the profit percentage does not follow the rise in prices.

In the face of this distortion, many workers have questioned the use of TR as a correction indicator, arguing that it does not reflect inflation and that the FGTS balance will lose value.

This situation prompted the Solidarity Party to file a lawsuit with the federation in 2014, demanding that the FGTS be corrected by an index more consistent with inflation, such as the IPCA, which more accurately reflects differences in the costs of living in Brazil.

The STF, in deciding the case, determined that the correction of the FGTS accounts should be made by the IPCA from now on, ensuring that future balances do not lose their purchasing power.

However, the decision did not take into account previous losses, which angered workers. This is because many felt that they were harmed by the application of technology in previous years.

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The proposal aims to guarantee retroactive payments from the guarantee fund

Faced with this situation, the Solidariedade party appealed the decision, asking the STF to extend the effects of the IPCA correction to a retroactive period of at least five years before the ruling.

The justification is that the FGTS, being a constitutional right of workers, cannot incur economic losses due to the application of an outdated index. For the party, retroactive correction is important to ensure that workers’ rights are preserved.

Furthermore, Solidariedade seeks to ensure that if retroactive correction for all workers is not possible, then at least those who have already filed legal claims against TR have the right to recover their balances.

This point is important, as many workers who objected to the application of the TR in court hope that the STF decision will ensure the recovery of their accumulated losses.

The party also raises the need for the FGTS Board of Trustees to clarify how future balances will be compensated, if the TR and interest correction do not reach the inflation value.

What about the decision on FGTS?

However, the Council does not have the authority to make adjustments based on inflation rates, which makes the issue more complex. The proposal seeks to ensure that workers do not continue to be harmed by decisions that prioritize housing credit at the expense of the true value of FGTS.

At the end of the trial, the STF sought to balance the preservation of workers’ rights with the social function of the FGTS, which finances, among other things, housing policies.

The decision, which limits correction to the future, did not fully satisfy any of the parties involved, and the Solidaridad Appeal seeks to reverse this scenario to ensure financial justice for the affected workers.

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