President Jair Bolsonaro vetoed an article in a piece of legislation aimed at bailing out airlines. The provision in question would have granted laid off workers the right to access money from their FGTS funds — a workers’ severance fund made up of mandatory contributions from all formal employees in Brazil.
Congress intended to allow workers to access their funds in order to mitigate the economic effects of layoffs and contract suspensions. However, the government uses FGTS money to finance infrastructure, housing, and basic sanitation projects, and the administration fears that allowing too many workers to access their accounts will hamper the fund’s liquidity.
The decree was drafted in order to avoid a full-scale collapse of the aviation industry, one of the worst-affected by the pandemic. Earlier this week, Latam — the biggest carrier in Latin America — confirmed it will fire over 2,700 employees, including pilots and flight attendants. Moreover, major airlines across the region have filed for Chapter 11 bankruptcy protection in the U.S.
Still, one obscure airline — owned by a Brazilian group based in tax haven Panama — has decided to open for business, saying that a time of crisis “is also a time of opportunity.”
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