The Supreme Federal Court (STF) has decided, by majority vote, that employers do not need to provide a formal justification for dismissing employees without cause or justification. This decision validates a presidential decree from 1996, with a final tally of 6 votes in favor and 5 votes against.
The case questioned the constitutionality of the decree issued by then-President Fernando Henrique Cardoso, which excluded the effects of International Labor Organization (ILO) Convention 158 in the country. This convention established the obligation to justify dismissals in both the private sector and the public service. According to this rule, unjustified dismissals would be prohibited, requiring the employer to retain the employee, even if they did not fit the profile of the position they held.
With the STF’s decision, the validity of the 1996 decree was confirmed, allowing employers to dismiss employees without the need for a formal justification. This means that the requirement for just cause in dismissals in the private sector will no longer be mandatory, following the majority opinion of the Court.
The tie-breaking vote was cast by Justice Nunes Marques, stating that the revocation of international treaties by a single act of the president requires congressional authorization. However, he proposed that this understanding should apply only to future cases, not affecting the decision made by former President Fernando Henrique Cardoso or other revocations established by presidential decrees.
The justice emphasized the importance of considering the potential adverse and harmful effects on society of the application of Article 158 of the International Labor Organization (ILO), highlighting concerns about strengthening the job market and the need for national and international investment for Brazil’s development.
In addition to Nunes Marques, Gilmar Mendes and André Mendonça supported the middle-ground thesis. The votes in favor of FHC’s decree regarding just cause were completed by the votes of Nelson Jobim and Dias Toffoli, who found it appropriate to allow the president of the Republic to revoke adherence to international treaties.
Ministers Mauricio Corrêa (rapporteur), Carlos Ayres Britto, Joaquim Barbosa, Rosa Weber, and Ricardo Lewandowski opposed the decision, albeit with different nuances and interpretations of the issue.
Some argued for maintaining the obligation to justify dismissals, asserting that this would protect workers’ rights and promote a more balanced relationship between employer and employee. Others believed that the revocation of the ILO convention and the lack of a requirement for just cause could have negative implications for workers, leaving them more vulnerable to arbitrary dismissal.
The final proclamation of the result by the STF is awaited to establish the definitive understanding of the president’s and Congress’s roles in revoking international treaties and adhering to international conventions. Meanwhile, the majority decision of the Court validates the presidential decree of 1996, allowing employers to dismiss employees without providing a formal justification. The ramifications and potential repercussions of this decision in the realm of labor relations in Brazil will now be observed.