LABOUR-BRAZIL: Housing Stipend for Judges Highlights Wage Gap

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, Feb 29 2000 (IPS) - A new housing allowance for judges, who had threatened to go on strike, accentuated the enormous income gap in Brazil and put the government in an even more difficult position regarding widespread demands for wage hikes.

A preliminary Supreme Court ruling issued Sunday allows more than 3,000 federal and labour court judges to claim an additional 1,100 to 1,670 dollars a month for rent and home maintenance costs.

The housing allowance was the formula hit upon to abort the illegal strike announced for Monday by a public sector in which the constitution does not allow stoppages.

The decision, handed down by Judge Nelson Jobim, sparked an outcry and accusations that it was unconstitutional – even from within the judiciary itself.

The beneficiaries will not have to account for the use given the housing allowance, which will even be available to those who live in their own homes.

Key lawmakers like the president of the Senate and Congress Antonio Carlos Magalhaes, as well as leading judges slammed the new stipend as illegal.

It is unfair that the benefit was granted to those who already have comfortable incomes, rather than those who earn the minimum monthly salary of 76 dollars, said Magalhaes.

The administration of President Fernando Henrique Cardoso is seeking to block an initiative to raise the minimum wage, which has lost much of its buying power, especially since the January 1999 crash of the Brazilian real.

The government holds that the deficit in the social security system makes such an increase impossible, because two-thirds of Brazil’s 19 million pensioners are paid the minimum monthly salary.

Jobim’s decision opened the floodgate to a new wave of demands for raises by public and private sector employees.

Deputy Paulo Paim of the leftist Workers Party announced that he would demand that a housing allowance be extended to all workers who do not own their own homes.

Unions of public employees began to discuss more radical measures to demand wage raises. “The judges pointed out the way,” demonstrating that the mere threat of a strike could wrest from the government an adjustment of salaries frozen for the past five years, said public sector trade unionists.

The legal ruling has brought arguments against raising the minimum wage to the equivalent of 100 dollars on May 1 crashing down, said secretary-general of the trade union confederation Central Unica de Travalhadores, Joao Antonio Felicio, who announced a new offensive to demand the increase.

The 1,299 prosecutors of the Public Ministry (public prosecutors office) demanded that they had the same right as the judges to a housing allowance, while state judges prepared to push for a similar stipend.

Several Supreme Court magistrates admitted that the court had jumped into a trap. But they also pointed out that they could overturn the decision in a final ruling to be handed down shortly by all 11 members of the court.

Nearly all of the magistrates sitting on the Supreme Court, including Jobim himself, renounced the benefit in order to avoid accusations that they were acting in their own interest.

A final solution to the problem would be the setting of a cap on public sector salaries as stipulated by the constitution. But such a measure has been held up for two years by discrepancies between the Executive, the Judiciary and the Legislature.

The justice system wants the cap set at 7,070 dollars – the salary now earned by three members of the Supreme Court of Justice who also hold positions on the Supreme Electoral Court.

Increasing the salaries of all 11 Supreme Court magistrates to that level would lead to an automatic raise for judges below them, whose salaries are proportionate to what their superiors earn.

At the start of their career, federal or labour court judges earn a net salary equivalent to 2,100 dollars a month. But their wages would automatically rise by 67 percent if the cap on public sector salaries was set at 7,070 dollars.

That is what federal and labour court judges, whose threat to go on strike triggered the current ruckus, are seeking. But the resultant chain of raises for public employees would aggravate the fiscal deficit and threaten the targets agreed with the International Monetary Fund.