São Paulo labour court overturns TST ruling following order by justice Gilmar Mendes

In a report published by Folha de S.Paulo, Luiz Eduardo Amaral, partner in the Employment and Pensions practice at FAS Advogados, analyses a ruling by the Regional Labour Court for the 2nd Region which, following an order from Brazil’s Federal Supreme Court, set aside the Superior Labour Court’s position on holding a former partner liable for the employment debts of a bankrupt company.

The case highlights the divergence between the Federal Supreme Court and the Superior Labour Court regarding jurisdiction to enforce employment claims in judicial reorganisation and bankruptcy proceedings. For companies, partners and investors, the discussion reinforces the importance of monitoring developments in case law and properly assessing employment and asset-related risks in corporate transactions, business restructurings and partner exits.