On August 7, 2025, the Plenary of the Supreme Federal Court of Brazil (STF) reached a majority of six votes against allowing companies from the same corporate group to be included directly in the enforcement phase of a labor judgment if they did not participate in the trial phase of the case.
The decision came in Extraordinary Appeal (RE) 1,387,795, recognized under Theme 1,232 of general repercussion. According to the majority, companies from the group may only be included in exceptional circumstances — such as fraud or the irregular dissolution of a legal entity — and only with full respect to the rights of defense, adversarial proceedings, and due process of law.
Some justices disagreed, arguing that Brazil’s Consolidation of Labor Laws (CLT) does allow group companies to be brought into the enforcement phase, provided the right to defense is preserved. Facing this division, the President of the STF suspended the trial in search of an intermediate solution that balances the protection of workers’ claims with legal certainty for businesses.
If the rapporteur’s position prevails, employees will be required to identify all companies within the group at the start of the lawsuit, which may increase procedural complexity and stimulate further litigation.
For businesses, the ruling is seen as a major step forward for legal certainty. It prevents companies from being held liable for labor debts without having participated in the underlying proceedings. This predictability supports better financial, corporate, and governance planning, while also protecting company assets from sudden freezes. The decision will also be particularly relevant in cases of corporate restructuring, ensuring that dissenting shareholders or entities can fully exercise their right to defense.
The case highlights the importance of companies organized within corporate groups taking a preventive and strategic approach to labor risk management. Key measures include implementing robust labor compliance programs, conducting regular reviews of contracts and corporate structures, actively monitoring labor liabilities across related entities, maintaining strong legal documentation to demonstrate the autonomy of each company.
Such practices not only reduce litigation exposure, but also strengthen corporate governance, institutional reputation, and operational resilience in the Brazilian market.
