Impacts of Covid-19 on Labor Courts – 1 year into the pandemic and the increase in labor lawsuits

Ariadne Fabiane Velosa
Lawyer at Marcos Martins Advogados

The Covid-19 pandemic has led to changes in the labor justice system, as well as in labor relations both in Brazil and around the world.

The number of labor complaints registered by the Regional Labor Court of the 15th Region (TRT-15), located in Campinas/SP, has increased by 13% in the last two years, according to data from the agency’s Research and Statistics Coordination. Of these, at least 50% are related to non-payment of severance pay by employers. According to the president of the institution, the crisis is the main reason for the growth and it is possible that there will still be repercussions in the coming years.

The latest statistics show that from January 1 to December 2020, 1,161,417 (one million, one hundred and sixty-one thousand, four hundred and seventeen) cases were distributed in the Labor Court. Of this number, the term “covid-19” is mentioned in the Labor Complaints of 86,058 (eighty-six thousand and fifty-eight) lawsuits.

Thus, the survey carried out by the Superior Labor Court showed that employee lawsuits claiming severance pay, such as prior notice and a 40% FGTS fine, are related to the disease caused by the coronavirus.

The statistics show that in January 2020 there were already 55 lawsuits in the Labor Courts related to the pandemic. However, the increase occurred in April, with 1,117 cases. It should be noted that the Judicial Regions with the highest number of lawsuits in total were Minas Gerais, Rio de Janeiro and Campinas (SP).

Thus, according to data from the Superior Labor Court (TST), although the total number of lawsuits in the first instance decreased by 26% in April 2020 compared to March, claims related to the disease increased by 527% in the same period of comparison.

Provisional measure 927/2020 issued by the President of the Republic established in its article 29 that Covid-19 was not an occupational disease, except upon proof of a causal link. In addition, article 31 suspended the work of labor inspectors for 180 days.

However, representative organizations and parties filed direct actions of unconstitutionality (ADIs) against the Provisional Measure in the Federal Supreme Court, which declared the rules unconstitutional.

Thus, it was established that in order to consider covid-19 as an occupational disease, proof of contagion within the work environment is a requirement, which has generated enormous concern in companies and is expected to generate even more lawsuits.

It should be noted that the greatest demand in the Labor Courts comes after termination of employment, i.e. when employment contracts are inactive. Thus, with the large number of layoffs, added to the financial difficulties and defaults of businesses that close their doors, it is likely that labor disputes will increase during the course of 2021.

In an attempt to mitigate these impacts, the federal government is about to issue a new Provisional Measure that will recreate the program to reduce working hours and wages and the Bem (Emergency Benefit).

Therefore, in order to reduce the impact of the pandemic on labor relations, which will be reflected in the Labor Courts, employers will need to be aware of all the legislation and recommendations issued, as well as -create general measures related to good hygiene and conduct practices, as well as spread unity and solidarity with the team as a whole, understanding the exceptions, looking for the best way to sustain their business, respecting the peculiarities of each one to, together, face the crisis triggered by the coronavirus.

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