In brief
Following the ruling issued on 8 June 2022, which determined that collective terminations require union involvement, Brazil’s Supreme Court has published on 25 April 2023 a new decision clarifying that such requirement applies to collective terminations implemented after 14 June 2022.
The Supreme Court decision states that “prior union intervention is an essential procedural requirement for the collective termination of workers, which is not to be confused with prior authorization by the union or the signing of a collective agreement”.
According to the first merit decision issued last June 2022, there is no requirement for the union to approve the employees’ dismissal. Accordingly, it is not mandatory to execute a collective bargaining agreement to regulate the terminations. However, according to Brazil’s constitutional court, companies are required to establish an open dialogue with the union in order for the collective terminations (implemented after 14 June 2022) to be valid.
Author
Clarissa Lehmen
Clarissa Lehmen joined the Firm in 2014. She integrates the employment & compensation practice group, with focus on employment advisory, assisting companies in strategic matters. Clarissa has a wide breadth of experience in strategic matters, including defining and implementing strategies for labor matters relating to C-level executives, benefits harmonization, expatriation, outsourcing, due diligence audits related to Mergers & Acquisitions, retention schemes, Stock Options and negotiations with labor unions.
Author
Leticia Ribeiro C Figueiredo
Leticia Ribeiro C. de Figueiredo joined the Firm in 1998, as a corporate trainee, and became partner in 2013. Until July 2003, she was primarily involved in M&A and Corporate Law, with experience in national and international M&A projects and corporate restructurings. From July 2003 on, she has been working exclusively in the Labor Law practice group.
She has a wide breadth of experience with strategic litigation cases and relevant consultancy in individual and collective matters (i.e. restructuring, equity pay, PDVs – voluntary resignation program, PLRs – participation in profits or results, alteration of compensation plans and benefits), including national and international projects. Additionally, she works with collective bargaining agreements.
*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.
