Do bonuses count as salary in Brazil? What the CLT says

It depends on the nature of the payment. Since the 2017 reform, bonuses (prêmios), understood as discretionary payments for performance above what is ordinarily expected, are not part of pay, even when regular (CLT, art. 457, §§ 2 and 4). Fixed amounts paid every month with no link to performance, even when called a "bonus", may be treated as salary and count toward vacation, 13th salary and FGTS.

Quick summary

• Genuine performance bonus: paid for above-expected performance, with clear rules; not salary.
• Legal or function bonus (gratificação): part of salary.
• Commissions: part of salary.
• Fixed monthly "bonus": may be disguised salary.
• Profit sharing (PLR): its own rules (Law 10,101/2000), not salary.

How to tell them apart

| Payment | Nature | | --- | --- | | Bonus for beating targets above normal, with written rules | Not salary | | Fixed monthly amount called a "bonus" | May be salary | | Function bonus | Salary | | Sales commissions | Salary | | Profit sharing (PLR) | Not salary, own rules |

Why it matters

If a payment is salary, it must count toward vacation plus 1/3, 13th salary, FGTS, overtime and, on termination, the final amounts. When an employer labels salary as a bonus, the differences can be claimed in the Labor Courts.

Frequently asked questions

Does a bonus paid every month become salary?

If it is truly a bonus for above-expected performance, the law says no, even if regular. If it is a fixed amount unrelated to performance, it may be salary.

Does an annual bonus count toward the 13th salary?

A performance bonus does not. An agreed, regular gratificação may, depending on the case.

Is INSS deducted from bonuses?

A bonus meeting art. 457, § 2 is not part of the social security contribution base.

Read more in this series

• Profit sharing (PLR)
• Commissioned salespeople
• Benefits in kind
• Index: complete guide to labor rights

Topic: this guide is part of Pay and benefits, with all the guides on the subject.