Ruling annuls decision that ordered Petrobras to pay largest labor law fine in Brazil’s history

RIO DE JANEIRO, BRAZIL – On Wednesday, July 28, a Brazilian Supreme Court (STF) Justice overturned a 2018 decision by the Superior Labor Court (TST) that sentenced Brazilian oil company Petrobras to pay the largest labor fine in the country’s history, for failing to deposit additional wages agreed with some 51,000 employees.

The decision of Brazil’s highest labor court was overturned by STF Justice Alexandre de Moraes, in an individual decision that can still be appealed to the full Supreme Court.

According to specialists’ calculations, the repealed decision would have obliged Brazil’s largest company to pay additional salaries and other benefits of about R$46 (US$9.2) billion in updated values.

The value included back wages allegedly owed to thousands of active and retired employees and the readjustment of the current payroll by a percentage much higher than inflation.

The full TST narrowly determined, in June 2018, by 13 votes in favor and 12 against, to uphold the claim of the oil company’s employees in a court proceeding that had been filed in 2007.

The decision benefited some 51,000 Petrobras workers, who alleged that the company did not comply with the collective bargaining agreement between the state-owned company’s management and the unions, which had provided for additional payments that they never received.

The Federação Única dos Petroleiros (FUP), the main union of Petrobras employees, announced that it would file an appeal against De Moraes’ decision for it to be analyzed by the full STF and further said that the announcement of the decision in the middle of the recess of the Judiciary is strange.

The FUP statement says the decision only “served Petrobras and annulled the largest labor law fine imposed on the state-owned oil company” and that it “was surprised by the decision, adopted individually and during the recess of the Judiciary.”

“Surprisingly, a matter of such nature and complexity is decided individually by a magistrate and during the recess of the Supreme Court,” said the FUP general coordinator Deyvid Bacelar.