Brazil's Supreme Court (STF) establishes a precedent and rules against the automatic inclusion of companies from the same economic group in labor law enforcement proceedings.

The Brazilian Supreme Federal Court concluded the judgment of General Repercussion Theme 1,232, establishing, by majority vote, the thesis that prohibits the automatic inclusion, in the labor execution phase, of a company belonging to the same economic group that did not participate in the knowledge phase of the process.

The established thesis is:

1. Enforcement of a labor court judgment cannot be pursued against a company that did not participate in the cognizance phase of the proceedings. The plaintiff must indicate in the initial petition the jointly and severally liable legal entities against which they intend to direct the enforcement of any eventual judicial title, including in cases of economic groups (Article 2, §§ 2 and 3, of the CLT), demonstrating concretely, in this case, the presence of the legal requirements.

2. Exceptionally, the redirection of labor enforcement proceedings to a third party who did not participate in the initial proceedings is permitted in cases of business succession (Article 448-A of the CLT) and abuse of legal personality (Article 50 of the CC), observing the procedure provided for in Article 855-A of the CLT and Articles 133 to 137 of the CPC.

3. This procedure applies even to redirections carried out before the 2017 Labor Reform, except for the indisputable exceptions regarding cases that have already been judged, credits that have already been satisfied, and executions that have been concluded or definitively archived.

The majority opinion — formed by Ministers Dias Toffoli (rapporteur), Cristiano Zanin, Flávio Dino, André Mendonça, Nunes Marques, and Luiz Fux — concluded that the automatic inclusion of companies from the same economic group in the execution process violates the principles of adversarial proceedings, full defense, and due process of law.

Thus, holding a company liable that was not involved in the discovery phase will only be possible in cases expressly provided for by law, through the application of the broader theory of piercing the corporate veil, which has been rejected by the Labor Courts, which require proof of fraud, misuse of purpose, or commingling of assets.

Because it is a thesis established with general repercussion, the understanding of the STF (Supreme Federal Court) becomes binding, imposing itself on all courts in the country.

This impacts thousands of ongoing labor lawsuits, imposing stricter requirements for including companies from the same economic group as defendants and increasing predictability and legal certainty in business relations.