CLT or PJ Which is the Best Option for Your Career?

If you are looking for a new job opportunity or have received a proposal to change your hiring regime, you have probably already come across the following question: CLT or PJ?

This is one of the most common questions in today's job market, especially given the growth in hiring through legal entities. But which of the two options is more advantageous?

The answer depends on several factors, such as professional profile, personal goals and type of service provided.

In this article, we will explore everything you need to know about CLT and PJ, including the pros, cons, legal differences, impact on retirement, benefits and what to consider when choosing the best path for your career.

What does CLT mean?

CLT is the acronym for Consolidation of Labor Laws, created in 1943. A worker under the CLT regime is considered a formal employee, with signed card and protected by a series of rights guaranteed by law, such as paid vacations, 13th salary, FGTS, INSS, night shift bonus, among others.

Working under CLT offers legal security and stability, being an advantageous option for those seeking predictability and guaranteed benefits.

What does it mean to work as an individual contractor?

PJ is the acronym for Legal Entity. In this model, the professional acts as a service provider, usually issuing an invoice through a CNPJ. He does not have an employment relationship with the contracting company, which means that there are no legal obligations such as FGTS, vacations or 13th salary on the part of the company.

Despite that, working as an individual contractor can be quite advantageous, especially because of the flexibility, possibility of earning more and freedom in negotiating values.

CLT or PJ: The Main Differences

Below, we highlight the main differences between the two regimes so that you understand the impact of each choice:

Aspect	CLT	PJ
Employment relationship	Yes, with a registered employment record	There is no employment relationship
Mandatory benefits	Vacation, 13th salary, FGTS, INSS, transportation voucher, etc.	No mandatory benefits
Taxation	Paycheck discounts (INSS, IR)	Taxes paid via company regime (Simples, etc.)
Stability	High, with rules for dismissal	Low, with the possibility of ending the contract at any time
Professional freedom	Limited, with fixed hours, subordination	High, with autonomy in terms of schedules and working methods

Advantages of the CLT Regime

For many workers, the security and the labor benefits are major differences in the CLT. See the main positive points:

• Financial stability: the salary is fixed and predictable.
• Benefits guaranteed by law: vacations, 13th salary, FGTS, licenses, among others.
• Retirement: automatic contribution to INSS.
• Coverage in case of illness or accident: access to sickness benefit and disability retirement.

Disadvantages of CLT

Despite the benefits, the CLT regime also has some negative points:

• High tax burden: both for the employee and for the company.
• Less flexibility in schedules.
• Less freedom to negotiate salaries.
• Bureaucracy in admission and dismissal processes.

Advantages of Working as an Individual Contractor

Now, let's analyze the main attractions for those who consider working as Legal Entity:

• Higher pay: since there are no labor charges, the company can pay more.
• Flexibility: freedom of schedules, locations and form of action.
• Possibility of undertaking: more autonomy to manage your own career.
• Tax deductions: it is possible to deduct operating expenses, depending on the tax regime.

Disadvantages of the PJ Regime

Even with so many benefits, the PJ regime also brings risks and responsibilities:

• No mandatory benefits: there are no paid holidays, 13th salary, FGTS, etc.
• Greater financial risk: instability of contracts and payments.
• Legal responsibilities: it is necessary to issue an invoice, pay taxes and keep accounting up to date.
• No legal protection in case of illness or accident, unless the professional contributes to the INSS on his own.

CLT or PJ: Which Pays More?

This is one of the most frequently asked questions among professionals. On average, a PJ can earn up to 30% to 40% more than a CLT, but it is necessary to consider that the costs of social security, taxes, vacations, health and possible periods without work also fall on the professional himself.

To compare more accurately, see this example:

• CLT: salary of R$ 6,000, with all benefits included.
• PJ: remuneration of R$ 9,000, without benefits.

It seems advantageous, but the PJ must pay taxes (ISS, IRPJ, INSS), health insurance, accountant, autonomous vacations and still guarantee a reserve for downtime.

That's why, the amount received as an individual contractor needs to be much higher to compensate for the lack of benefits and instability.

Impact on Retirement: CLT or PJ?

An important point that few consider when deciding between CLT or PJ is the impact on retirement. CLT workers have mandatory contributions to the INSS, with the possibility of retirement based on length of service, age, or disability, in addition to benefits such as sick pay and maternity pay.

The PJ professional You need to make your own contribution to the INSS, as an individual taxpayer. Many forget this, and may be left unprotected in the future.

Undercover PJ: Beware of Labor Fraud

An important point: there are companies that hire professionals as PJ, but impose typical rules of a CLT contract, such as fixed hours, subordination and exclusivity. This is considered labor fraud, known as “pejotization”. The company can be sued and the worker can claim CLT rights in court.

If you work as an individual contractor, it is essential to maintain autonomy, flexibility and freedom of action so that the contract is legal.

How to Choose Between CLT or PJ?

The decision between CLT or PJ depends on several factors:

1. Personal profile: Do you prefer stability or freedom?
2. Career goals: Do you want to start a business or pursue a career in large companies?
3. Moment of life: Are you looking for security to finance a property or do you prefer to take risks to grow faster?
4. Financial organization capacity: As an individual entrepreneur, you need to manage your income well.
5. Type of activity: some sectors, such as technology, consulting and design, place a high value on the PJ model.

Tips for those who want to migrate from CLT to PJ

If you are thinking about changing your work regime, here are some important recommendations:

• Open your company in a regularized manner: can be MEI, EI, EIRELI or LTDA, depending on the revenue.
• Hire a trusted accountant to manage taxes and declarations.
• Plan your emergency fund, especially in the first few months.
• Contribute to the INSS voluntarily to ensure protection and retirement.
• Get a good health and insurance plan for unforeseen situations.
• Organize your schedule and finances like a company.

The choice between CLT or PJ It is a strategic decision that must be made with awareness and planning. The CLT regime offers more security, benefits and predictability, being ideal for those seeking stability and wanting to worry less about bureaucracy.

On the other hand, the PJ regime is a gateway to autonomy, flexibility and greater financial gains, as long as the professional is organized and knows how to deal with legal and tax obligations.

There is no right or wrong answer. Evaluate your profile, your goals and what makes sense at the current moment in your career. If possible, consult an accountant or career specialist to make the safest decision.