Gilmar's Decisions May Stop up to US$ 186 million per Month in Labor Claim Payments

Injunctions on the correction index confused in the legal environment and in the Labor Justice node

Willian Castanho

Supreme Court Justice Gilmar Mendes's recent decision may stop payment of up to R$ 1 billion (US$ 186 million) per month in cases won by workers. The injunctions deal with monetary correction.

The measures were taken amid the pandemic. Even with the minister's claim that the second decision clarifies the pause, the controversy over which index to use remains in the legal environment.

On Saturday (27), the justice ordered the suspension of all labor lawsuits. The measure, since then, has tied a knot in the Labor Court.

Supreme Court Justice Gilmar Mendes (Foto: Pedro Ladeira/Folhapress, PODER) - Folhapress

In an order on Wednesday (1st), Gilmar affirmed that the actions continue, but only those that use the TR, now zeroed. He vetoed the application of the IPCA-E-a more advantageous index for the employee.

As it denied the request to reform the decision, as requested by the Attorney General's Office, the confusion continues. According to him, the previous injunction remains valid in its entirety.

In practice, almost all actions require correction. It covers overtime, vacation, FGTS deposits, or 13th salary.

The employee is also entitled to 1% interest per month. In 12 months, interest rates reach 12% plus TR, at 0%, or IPCA-E, at 1.92%. The TR, as determined by labor reform, has been ignored.

Superior Labor Court data collected by Folha show that today there are 970 thousand lawsuits awaiting sentence in the lower court.

Added to that number are 2.5 million cases already in the execution phase - when the worker receives what he is entitled to. The amount has remained stable since January 2018.

From January of that year to May 2020, R$ 29.1 billion was paid through executions - the monthly average of R$ 1 billion (US$ 186 million).

Translated by Kiratiana Freelon

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