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Extended Paternity Leave Worries Some Employers in Brazil

Posted on the 22 March 2016 by Angelicolaw @AngelicoLaw

Men and women are different in many ways. One of the ways they differ under Brazilian law is with respect to parental leave. After giving birth, women are entitled to six months of maternity leave; four months for companies in the private sector. Fathers, however, receive just five days of leave after the birth of a child. That is, until recently.

Congress has approved a law increasing paternity leave to 20 days, Bloomberg BNA reports. While worker advocates welcome the change, the law has its skeptics in the business world where companies fear that productivity will suffer.

The increase in paternity leave does not affect all employers. Only companies participating in a voluntary program that encourages an increase in maternity leave are eligible for the paternity leave increase, Bloomberg BNA explains. That program extended maternity leave to six months, up from four months. As an incentive to employers, those participating in the extended paternity and maternity leave programs can deduct the costs of the increased leave from their income taxes.

Approximately 18,700 companies are currently participating in the extended parental leave programs. Yet some argue that the increased leave adds to business costs. Even though companies can deduct the salaries of parents on leave from their income taxes, the companies must still pay employee benefits guaranteed under Brazilian labor law. The costs of these benefits can add a substantial financial burden on the company.

Worker advocates, on the other hand, welcome the extended leave. The concept of extended paternity leave also appears to have widespread support in society. Rodrigo Neves, mayor of the city of Niterói, sought to overturn the law for his city employees, explaining to Time magazine that the city would not be able to manage the shortage of teachers and other public workers. But he was rebuffed by a community campaign to keep the law in place.

Some studies make a case for extended paternity leave actually having beneficial economic effects. Time magazine cites research that suggests that the effect of increasing paid paternity leave is an increase in the participation of women in the workforce. At the end of the day, it will be up to private companies to determine whether that economic benefit, along with the tax deduction considerations, is enough to encourage participation in the extended parental leave programs.

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