Robots and Automation: How They Affect Workers’ Retirement

This page is a translation of the original Portuguese text, provided for convenience. It deals with Brazilian law. If there is any discrepancy, the Portuguese version prevails. Read the original in Portuguese

Industrial automation and robots are already reshaping the Brazilian labor market, and the effects on workers’ retirement are deep and immediate.

The Rise of Automation in Brazil and the New Reality of Work

We are living through a period of rapid change in labor relations. Industrial robots, artificial intelligence systems, and automated platforms are being introduced in sectors such as automotive manufacturing, logistics, agribusiness, and financial services, and they are redrawing the profile of the Brazilian worker. Looked at from a social security perspective, the effects go far beyond the simple replacement of jobs. The way people pay into the Social Security system, accumulate service time, and plan for retirement is being restructured from the ground up.

Automation is not new. Machines have been taking over human tasks since the Industrial Revolution. What sets the present moment apart is the speed and breadth of the change. Collaborative robots (so-called “cobots”) now work side by side with people on assembly lines. Algorithms process legal documents, medical reports, and accounting analyses. Autonomous systems manage entire inventories without human intervention. In every one of these cases, workers are either moved into different roles or, in many cases, simply laid off.

For Social Security Law, this reality creates concrete challenges. A worker who loses a job to automation stops contributing to the INSS (Brazil’s National Social Security Institute). That gap can jeopardize the minimum contribution period (carência) required for many benefits, delay the date of retirement, and reduce the amount of the future benefit. Many of these workers are between 40 and 55 years old, which is precisely the most critical stage for retirement planning, so the seriousness of the problem is plain.

Direct Effects on Time Counting and Insured Status

One of the most immediate effects of automation on a worker’s social security record is the loss of insured status. Under current social security legislation, a worker who stops contributing to the INSS keeps insured status for a limited time (the so-called “grace period“), which ranges from 12 to 36 months depending on the situation. After that, without new contributions, the worker loses the right to benefits such as the temporary disability benefit, permanent disability retirement, and the survivor’s pension for their dependents.

We see that workers replaced by automated systems often face long periods of unemployment. Finding new work in sectors that still need human labor is not always possible, especially for professionals whose technical training is specific to activities that have been automated. An industrial machine operator with 20 years of experience, for example, may have enormous difficulty repositioning in the job market. During that transition, social security contributions stop.

Another point that deserves attention is the effect on how the benefit is calculated. Since the Social Security Reform, the general rule for calculating retirement uses the average of all contribution salaries since July 1994. Periods without contributions do not enter the calculation directly, but they can affect the coefficient applied to that average. A worker who needs 35 years of contributions to receive the full benefit may find that goal moving significantly further away after a long period outside the formal job market.

We also see situations in which automation changes the nature of the work performed. A worker who did special-conditions work (exposed to harmful agents such as noise, heat, or chemicals) and is reassigned to an administrative role loses the right to the differentiated counting of service time. That change can mean years of additional work before retirement.

Informal Work and New Forms of Employment

Automation does not only eliminate jobs. It also pushes a significant share of workers into informal work or into types of work with reduced social security protection. Many professionals displaced by automation move to digital platform work (ride-hailing apps, delivery, on-demand household services), to individual entrepreneurship, or to unregistered self-employment.

In these arrangements, social security contributions depend entirely on the worker’s own initiative. Unlike formal employment, where the employer collects the contribution automatically, self-employed and informal workers must register as an individual contributor or as an Individual Microentrepreneur (MEI) and make the payments themselves. In practice, we find that a large share of these workers do not contribute regularly, whether because they are unaware of the requirement or because of the financial instability that comes with this kind of work.

Automation does not just eliminate jobs. It changes the worker’s relationship with the entire social protection system, calling for new retirement planning strategies.

The MEI, although it offers a simplified entry point into the social security system, provides limited coverage. The reduced contribution (5% of the minimum wage) secures only retirement by age, and only in the amount of one minimum wage. For a worker who previously contributed on higher earnings under the CLT (Brazil’s Consolidated Labor Laws) regime, this shift means a sharp drop in the level of social security protection.

Special Activities, Unhealthy Conditions, and the Role of Robots

One aspect often overlooked in this discussion is the effect of automation on the recognition of special activities. When robots take over unhealthy or dangerous tasks, the human worker is no longer exposed to the harmful agents that justified classifying the work as special. This change has significant social security consequences.

Special retirement allows a worker to retire with 15, 20, or 25 years of contributions (depending on the harmful agent), without application of the social security factor under the rules in force before the Reform. Since the Social Security Reform, the rules have become more restrictive (requiring a minimum age combined with exposure time), but special retirement still offers a significant advantage over ordinary retirement.

When automation removes the worker from exposure to the harmful agent, the period that follows is counted as ordinary time. This can happen abruptly (when an entire production line is automated) or gradually (when the introduction of robots progressively reduces exposure). In either case, the worker needs to assess carefully how the change affects their retirement planning.

On the other hand, we recognize that automating unhealthy activities brings undeniable benefits to workers’ health. Less exposure to harmful agents reduces occupational illnesses and workplace accidents, which is a significant gain in quality of life. The challenge is to balance that benefit against the social security protection a worker loses when removed from special activity.

We also see situations in which automation creates new forms of exposure. Workers who operate, program, or maintain robotic systems may face specific risks (electromagnetic radiation, high-voltage electric fields, noise from industrial equipment) that, depending on exposure levels, may qualify as special activity. Each case calls for an individual technical analysis, supported by an appropriate expert report.

Strategies for Social Security Protection in the Age of Automation

Given this scenario, we believe retirement planning becomes even more essential for workers in sectors vulnerable to automation. There are concrete steps you can take to protect your right to retirement and secure the best possible coverage within the Social Security system.

The first step is to keep your contributions regular, even during a career transition. A worker who loses formal employment should immediately consider contributing as an optional insured person or as an individual contributor. Continuing to contribute prevents the loss of insured status and keeps your contribution time counting, both of which are essential for any type of retirement.

The second strategy is to carefully document your entire work history. You should gather and keep pay stubs, work booklets (both physical and digital), technical reports on workplace environmental conditions (LTCAT), social security occupational profiles (PPP), and any document that proves the nature of the work you performed. This documentation is especially important if you did special-conditions work before automation, because it allows special-activity time to be converted into ordinary time (with a 40% increase for men and 20% for women) for retirement purposes.

The third recommendation is to periodically review your full contribution history with the INSS, checking that every employment relationship is correctly recorded in the National Social Information Registry (CNIS). Discrepancies, omissions, and inconsistencies are fairly common and can be corrected through an administrative request or, if necessary, in court.

We also suggest that workers in career transition look closely at the transition rules established by the Social Security Reform. Depending on your age and the contribution time you have already accumulated, it may be more advantageous to follow a specific transition rule (the 50% toll, the 100% toll, the progressive age rule, or the points rule). Because this analysis involves complex calculations and individual variables, it should be carried out by a professional who specializes in Social Security Law.

Finally, it is worth following the legislative debates about taxing automation. Many countries are already discussing social security contributions on the use of robots and automated systems, as a way to offset the shrinking contribution base caused by the replacement of human workers. In Brazil, although this discussion is still at an early stage, it could lead to significant changes in the financing of Social Security in the coming years.

This topic is directly related to AI and labor law, which we cover in a dedicated article.

This topic is directly related to filing automation in the social security JEF (Special Federal Courts), which we cover in a dedicated article.

As informações deste artigo são de caráter informativo e não substituem consulta jurídica individualizada. Cada caso possui particularidades que exigem análise específica.