Put Israel Cruz and Rafael Mello  – 21/04/2020

On April 6, Minister Ricardo Lewandowski, in the proceedings of Direct Action of Unconstitutionality No. 6,363, filed by the Rede Sustentabilidade party, in a preliminary decision, determined the interpretation in accordance with the Federal Constitution of Provisional Measure 936/2020 (MP 936/2020), in the following terms:

That said, based on the reasons set out above, I partially grant the precautionary measure, ad referendum of the Plenary of the Supreme Federal Court, to give an interpretation in accordance with the Constitution to § 4 of art. 11 of Provisional Measure 936/2020, in order to establish that “[t]he individual agreements to reduce working hours and wages or temporarily suspend an employment contract […] must be communicated by the employers to the respective labor union, within a period of up to ten calendar days, counted from the date of their execution”, so that the latter, if it wishes, may initiate collective bargaining, its inaction implying consent to what was agreed by the parties.

In other words, Minister Ricardo Lewandowski, in practical terms, had conditioned the individual agreement for reduction of working hours and/or suspension of the employment contract on prior communication to the union and its refusal to negotiate or lack of response.

There was much speculation about the constitutionality of MP 936/2020 and also about the possibility of changing the single-judge decision of Minister Ricardo Leandowski, which created a scenario of legal uncertainty in the application of MP 936/2020.

Last Friday (04/17/2020), the Plenary of the Federal Supreme Court (STF) analyzed again, now in a collegial manner, the preliminary measure requested in ADI No. 6,363. By majority vote, an understanding was reached for the reform of the preliminary injunction previously granted by Minister Ricardo Lewandowski, rapporteur of the action.

In their votes, Ministers Alexandre de Moraes, Luís Roberto Barroso, Luiz Fux, Carmen Lúcia, Gilmar Mendes, Marco Aurélio and Dias Tofoli understood to revoke the preliminary injunction of the provisional measure determining the applicability of MP 93/2020 in its literal form until the final judgment of ADI 6,636 or until its conversion into law when it will once again undergo analysis of its constitutionality before the National Congress.

Justices Edson Fachin and Rosa Weber would have expanded the terms of the injunction granted in their votes to declare MP 936/2020 fully unconstitutional, but this understanding was defeated. Finally, Justice Ricardo Levandowski understood that the injunction should be maintained.

Thus, MP 936/2020 was reestablished in its literal form and the individual agreement between employee and employer for reduction of working hours and salary and for suspension of the contract was authorized, in accordance with articles 7 and 8 of the aforementioned MP 93/2020, without the need for participation of the category union or even conditioned on its refusal to negotiate.

Although the STF has, in a certain way, preliminarily validated MP 936/2020, our recommendation to our clients remains the same: caution in its application. If there is a need to implement a reduction in working hours and wages or layoffs, the possibility of pursuing collective bargaining should be assessed. The analysis of the unconstitutionality of MP 936/2020 or the acts carried out under its basis has not yet been exhausted and this means that in the future many procedures adopted by companies may be questioned in court.