Sixth Panel of the Superior Labor Court establishes understanding on the obligation of labor debts in sales of isolated units in Judicial Reorganization Proceedings

Marília Silva de Melo
Lawyer at Marcos Martins Advogados

The Sixth Panel of the Superior Labor Court, in the judgment of an Appeal for Review, established the understanding that the sale of an isolated production unit within the files of Judicial Recovery proceedings does not characterize the succession of companies in relation to the labor obligations provided for in articles 10 and 448 of the CLT.

The Court, in a unanimous decision, decided to dismiss the liability of the defendant company for the payment of debts prior to the acquisition of the production unit. According to the Appeal’s rapporteur, Justice Kátia Arruda, this understanding follows that already handed down by the Federal Supreme Court, which in the judgment of Direct Action of Unconstitutionality (ADI) 3934 had already established that

“the winning bidder is not liable for the debtor’s obligations in the event of the sale of branches or isolated production units during the course of judicial reorganization”.

At first instance, the 2nd Labor Court of Estrela/RS had ruled that the plaintiff’s employment contract had been transferred, and that the company selling the Isolated Production Units was therefore a successor and responsible for the entire conviction, a decision upheld by the 4th Region Labor Court and reformed by the Superior Labor Court in a very recent decision.

In judging the company’s appeal, the 6th Panel overturned the decision, holding that the recognition of succession directly contravenes articles 60, sole paragraph, and 141, item II, of Law 10.101/05, ruling out the characterization of corporate succession and liability for the debts of the labor claim prior to the acquisition.

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