The year 2024 was marked by important decisions by the Federal Supreme Court (STF), the Superior Court of Justice (STJ), and the Superior Labor Court (TST), which promise to influence the ways in which companies hire, their decisions and practices in 2025, as well as access to the Labor Courts in the coming years.
Below are the main topics discussed throughout 2024.
Topic 1,291, STF: employment relationship between driver and platform
On March 1, 2024, the STF recognized the existence of general repercussion of the matter dealt with in Extraordinary Appeal 1.446.336 (RE 1.446.336), presented by the Uber platform. The appeal discusses "recognition of an employment relationship between a driver of a transportation services app and the company that manages the digital platform" (Topic 1,291).
Since then, several unions, associations, and companies have joined as amicus curiae in the lawsuit, which is currently before the reporting judge, Justice Edson Fachin, awaiting review and scheduling of judgment.
The majority of the Supreme Court has ruled that there is no employment relationship between the drivers and the digital platform. For this reason, the STF is expected to maintain the same understanding when it definitively decides Topic 1,291.
The issue is expected to reach a resolution this year. Once the STF has handed down its decision, it will apply to various cases that discuss the same issue. In addition, the understanding given by the Supreme Court should be applied by all Brazilian courts.
Topic 1,072, STF: maternity leave for pregnant mothers in same-sex unions
On March 13, 2024, the Supreme Court ruled on Topic 1,072 to decide that non-pregnant mothers in same-sex unions are entitled to maternity leave. It also ruled that if the partner has already used the benefit, the non-pregnant mother will be entitled to leave for the same period as paternity leave.
Given this new scenario, it is incumbent on companies to adjust their internal policies and practices to grant maternity leave to pregnant mothers in same-sex unions, observing the limitations and conditions defined by the Supreme Court, to adequately guarantee the benefit to eligible employees.
Topic 1,226, STJ: legal nature of stock options
On September 11, 2024, the STJ ruled on Topic 1,226 and defined that gains arising from stock option plans (SOPs) do not have the legal nature of remuneration for Individual Income Tax (IIT) purposes, but rather capital gains, when the shares acquired by the participant are sold.
The STJ's decision provides great legal certainty for companies that choose to implement stock option plans. This is because, in addition to aligning the tax understanding with labor case law, consolidating the understanding that the gains obtained do not have compensation nature, the panels will declare other appeals dealing with identical matters to be dismissed or will decide applying the theory established, since the STJ's decision is binding on the Administrative Council of Tax Appeals (Carf), which will not be able to issue divergent decisions on the subject in similar cases.
Considering this decision, a new favorable environment has emerged for the discussion regarding implementation of stock option plans by companies in Brazil, provided that the SOPs are aligned with the requirements established by the Labor Courts, the Federal Courts, and the STJ itself.
RR 713-03.2010.5.04.0029, SDI-1 of the TST: adjustment of labor debts
In 2020, in the judgment of ADC 58, the STF ruled that the use of the reference rate (TR) as an index for adjusting labor debts was unconstitutional and ordered application of the Special Broad National Consumer Price Index (IPCA-E) in the pre-claim phase and the rate of the Special Custody Settlement System (Selic) after service of process, until there was a specific law on the subject. In 2024, Law 14,905/24 established the IPCA as the monetary adjustment index and Selic as the interest rate in the event of default on the obligations.
Based on these two premises, Sub-section 1 Specialized in Individual Disputes (SDI-1) of the TST decided, on October 25, 2024, within the scope of case RR 713-03.2010.5.04.0029, that, for the purposes of adjusting labor debts, the IPCA should be applied from the date of service of process and interest on arrears should be calculated by the difference between the Selic Rate and the IPCA. This changes the way labor debts are currently adjusted.
Please note that if the Selic rate is lower than inflation for the period, the rate will be considered zero, under the terms of article 406, paragraph three, of the Brazilian Civil Code.
From a judicial point of view, the decision is extremely important for ongoing proceedings. This is because, since it was handed down by the TST's SDI-1, it indicates the possibility that the labor courts will standardize their understanding of the issue, settling case law and establishing premises that must be observed and applied to current labor claims and future lawsuits.
For companies, the decision also serves as a parameter for calculating labor liabilities, especially for adjusting the provisioning of labor debts. It is therefore important for them to review the amounts provisioned to avoid significant differences in values in the event of adverse judgment.
Topic 23, TST: application of the Labor Reform
On November 25, 2024, the TST decided, by a majority vote, that the Labor Reform (Law 13,467/17) has immediate application to ongoing employment agreements, but only to events that occurred as of its entry into force - November 11, 2017. The theory is applicable to the entire Labor Justice.
It should be noted that the decision may still be appealed and is therefore not final. However, if the TST's understanding is upheld, the decision is extremely important for application of the rights arising from the Labor Reform and impacts on the time limit for claims made in labor lawsuits, whether or not related to the changes brought about by the Labor Reform.
ADI 5,826, ADI 5,829, and ADI 6,154, STF: constitutionality of intermittent employment agreements
On December 13, 2024, the STF en banc validated, by a majority vote, articles 443, 452, and 611-A, subsection VIII, of the Brazilian Labor Law, introduced by the Labor Reform, which established the intermittent employment agreement.
According to the reporting judge, Justice Nunes Marques, intermittent employment agreements do not abolish labor rights or weaken employment relationships. According to him, this type of engagement offers protection especially to workers who are informal, as well as helps to reduce unemployment.
As a result, companies that have already adopted this type of contract now have greater legal certainty to continue hiring intermittent workers.
The STF's validation also encourages companies that do not yet use this modality, for fear of the practice being invalidated, to adopt it.
We highlight that intermittent employment agreements are valid for all activities, except for pilots, who are governed by their own legislation, as provided for in article 443, paragraph 3, of the Brazilian Labor Law.
Topic 21, TST: granting of free legal aid
On December 16, 2024, the TST established that the judge must automatically grant the benefit of free legal aid to a plaintiff who proves, in the lawsuit, a salary equal to or less than 40% of the Social Security ceiling. The aim of this decision is to facilitate access to justice for those who cannot afford the costs of a labor claim.
The request for free legal aid may be contested by the company or another party oof the lawsuit, who must provide proof that the worker can afford it. In such cases, the judge must give the worker the opportunity to respond before deciding whether or not to maintain the benefit.
In our opinion, this TST decision promises to return to the scenario prior to the Labor Reform, in which free legal aid was granted in the majority of labor claims and, as a result, the number of new lawsuits was much higher than it is today.
We can draw a parallel with the STF's 2021 decision in ADI 5,766, which invalidated the rules of the Labor Reform that mandated payment of expert and legal fees by beneficiaries of free legal aid if they lost their lawsuit.
After this decision, the number of new labor claims grew significantly the following year - in 2020 407,373 were filed, while in 2022 439,551 were filed.[1]
With the expansion of access to justice by means of a simple declaration by the worker of his/her lack of funds and the certainty that the judge will grant the benefit of free legal aid, workers will certainly feel encouraged to turn to the courts in 2025 to resolve labor issues. As a result, a further increase in labor claims is expected.
We will continue to follow legal and practical developments on all the above topics.
[1] Data obtained from the TST’s projections
