Matters Before the TST in 2025: Decisions May Redefine Business Strategies

In 2025, the Brazilian Superior Labor Court (TST) will analyze three important Incidents of Repetitive Appeals (IRRs) in Specialized Individual Disputes Subsection 1, the body responsible for reviewing decisions of the Panels and unifies jurisprudence.   These decisions may set precedents with profound impacts on labor risk management and the formulation of business strategies. Terms such as judicial jurisdiction, union legitimacy, and compensation of labor benefits will be debated, with the potential to redefine business practices and directly influence the legal and financial planning strategies of companies.

The court’s decision on Topic 26—which refers to the Jurisdiction of the Labor Court in cases of disregard of the legal personality of companies under judicial recovery—will determine whether labor enforcement can be directed against the partners of companies under judicial recovery, considering the changes brought by Law No. 14,112/2020. The relevance of the decision for companies lies in the definition of the “competent court,” as this will: (i) clarify the limits of the Labor Court's role in enforcement actions involving companies undergoing judicial recovery; (ii) help mitigate financial risks by offering greater predictability to partners and investors, impacting strategic decisions in crisis scenarios; and (iii) favor legal planning, as companies are better able to adjust internal policies and recovery strategies, taking possible liabilities into account.

The decision on Topic 27, which deals with the Legitimacy of Unions in Class Actions and Public Civil Actions, will address the extent of the power of unions to file public civil actions in defense of collective rights, based on Law No. 7,347/85. Companies should follow this decision, as it may increase the legitimacy of unions, requiring companies to pay greater attention to collective negotiations and lawsuits. A scenario of greater union empowerment may increase the number of class actions and complicate labor agreements, increasing costs and potential risks. To this end, companies should review collective management practices, aiming to anticipate and mitigate conflicts with unions.

Topic 28 addresses the possibility of offsetting amounts paid as a function bonus against overtime recognized in court, examining the validity of this practice and applicable time limits. This issue is highly relevant, as it defines parameters that can directly impact the relationship between companies and workers in various sectors of the economy.

An unfavorable decision can have significant financial repercussions, especially in sectors that widely use positions of trust, such as banking. The resulting labor liabilities could be substantial, increasing operating costs and companies' exposure to litigation. In addition, the understanding adopted may set precedents for other professional categories by affecting remuneration and workday management policies, which broadens the scope of the legal impact.

In this scenario, strategic planning will be essential for companies. Adjustments to management practices will be necessary to ensure compliance with the new case law, and to mitigate financial and legal risks. The adoption of preventive measures can minimize the impact of any changes in judicial understanding, ensuring the stability of labor relations.

Court decisions related to labor issues transcend the legal sphere, directly impacting the financial health, corporate governance, and relationships of companies with their stakeholders. In this context, careful monitoring of these judgments is essential to mitigate risks and identify strategic opportunities in the business environment.

Among the main aspects to be considered is the anticipation of risks and opportunities. The decisions handed down by the TST can affect commercial contracts, collective bargaining, and labor liabilities, requiring thorough preventive analysis by companies. This analysis is essential to adjust expectations and plan short- and long-term actions.

In addition, companies will need to review and adjust their internal policies regarding court decisions. Compensation strategies, corporate management, and even judicial recovery plans may need to be reformulated to align with the understanding of prevailing case law, ensuring greater predictability and operational efficiency.

Finally, ensuring legal certainty must be a priority. The ability to position oneself appropriately in the face of changes in case law is crucial to avoid surprises and protect the interests of the business. Given the weight and relevance of these issues, managers and legal teams must remain alert to the decisions that will shape the labor scenario in 2025 and in subsequent years, ensuring the sustainability and compliance of business operations.