News

On August 7, Brazil’s Federal Supreme Court (STF) reached a majority decision to reject the automatic inclusion, in the judgment execution of labor claims, of companies belonging to the same economic group of the defendant that were never party to the case during the cognizance procedure.

This understanding, led by Justice Dias Toffoli and adjusted by a proposal from Justice Cristiano Zanin, was supported by Justices Flávio Dino, André Mendonça, Nunes Marques, and Luiz Fux. According to this view, a company called to answer for another group company’s labor debts must be granted the right to defend itself from the outset of the proceedings. Inclusion during the judgment execution phase would only be allowed in cases where abuse or fraud is proven, such as improper closing with the sole goal of evading liabilities.

During the same session, Justice Alexandre de Moraes aligned with the dissent opened by Justice Edson Fachin, emphasizing the possibility of including companies from the same economic group during the judgment execution phase, provided that their right to defense is ensured.

Given the divergences, the judgment was suspended by the Chief Justice of the STF, Luís Roberto Barroso, so that the justices may compromise to reconcile their differing views. The case will resume on a date yet to be determined.

If confirmed, this position may reduce the risk of liability for companies that were not directly involved in labor claims from the outset, reinforcing the importance of well-structured corporate organizations, robust document management to demonstrate autonomy across group companies, and proper management of labor litigation.

Our specialized Labor Law team remains available for any questions you may have and to assist with getting your company fully compliant with current labor legislation.