Law

THE CHARACTERIZATION OF THE ECONOMIC GROUP IN THE LABOR REFORM IN BRAZIL

By Vitória Bernardi, Maciel Group – Brazil

Labor law historically prevailed for the factual reality, escaping specific formalities, as demanded by Business Law, for instance, aiming through minimum evidences to guarantee the broadest protection to the part considered hyposufficient of the relation formed, the worker.

However, the extensive protection given to the worker and his ductility in the application by the Courts ended up curbing presumed entrepreneurs, who feared to risk their few possessions in the face of the uncertainties of judicial decisions.

Yet, since November 11, 2017, labor relations in Brazil have undergone a major change through the Labor Reform, imposed by Federal Law 1.3467/2017, which changed the hitherto consolidated Brazilian Labor Code by providing a new feature to employee/employer relations.

In particular, this article will deal with the characterization of the figure of the business economic group and its consideration in the decisive moment of the labor process (i.e. work process).

This provision was treated only in the provision in paragraph 2 of article 2 of the CLT - Consolidation of Labor Laws, which had the following content:

Paragraph 2. Whenever one or more companies, each of which has its own legal personality, is under the direction, control or administration of another, constituting an industrial group or of any other economic activity, shall, for the purposes of the relationship of the principal company and each subordinate company.

Nowadays, however, following the legislative amendment made in November, paragraph 2 has ended as follows:

Paragraph 2. Whenever one or more companies, although each of them has its own legal personality, are under the direction, control or administration of another, or even when, even though each one is autonomous, they belong to an economic group, they shall be jointly and severally liable for the obligations of the employment relationship.

The greatest change, yet, was the inclusion of the unprecedented prediction in paragraph 3, which says:

Paragraph 3. The group identity is not characterized by the mere identity of members, and the demonstration of integrated interest, the effective communion of interests and the joint action of its members are necessary.

As we can see, the amendment made in the second paragraph does not stand out in the face of so many more drastic. However, the innovation in the third paragraph can be a crucial point for the entrepreneur who owns or plans to own more than one company in their name.

Through this paragraph, from now on, one has to consider the impossibility to change the understanding of the configuration of the economic group when the subject is the conviction of a company under labor law. Previously, this paragraph was used indiscriminately to guarantee credit solvency through the solidarity of several companies with common partners. Although they had no other correlation.

Essentially, as in other innovations, the desired change will only be settled through a wide range of jurisprudence that will seek to homogenize the understandings of this new precept.

We see the decision made in a Labor lawsuit by Judge Marcos Dias de Castro, of the 18th Labor Court of the city of Rio de Janeiro, by innovating in the decision-making and opening new possibilities for the employer, he says:

"The mere identity of members does not characterize the economic group, since it is necessary for the configuration of the group three requirements, namely: the demonstration of integrated interest, the effective communion of interests and the joint action of its member companies (article 2, paragraph 3, of the CLT, added by Federal Law 13.467/2017)".

The requirements to be observed for the characterization of the economic group are concretely here. Which are:

  1. Integrated interest;
  2. The effective communion of interests;
  3. The joint action of its member companies.

Nevertheless, in this decision, even after the affirmation that in the concrete case the economic group is not formed, the Judge manifests himself demonstrating the possibility of circumventing this understanding by means of a reverse inconsideration maneuver, in these terms: "to predict the possibility of opening incident of inverse inconsideration ".

As already mentioned, the definition of the applicability of the third paragraph to the second article of the new Labor Law will only be settled after repeated judicial decisions of concrete cases.

Furthermore, through the implementation of less restrictive rules, such a definition will be indispensable, and it will bring a relief for the continuation of many enterprises and even the birth of several new companies of those who dream of undertaking and feel insecure about the protectionism of the employee.


Vitória Bernardi

Vitória Bernardi

Maciel Auditores, Porto Alegre, Brazil
T: + 55 51 40071219
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Published: May 2018 l Photo: Dominic - Fotolia.com

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