TST Resumes Activities and Agenda for Definition Regarding Jurisdiction for FGTS Withdrawals

The court reopened the semester of judgments this week. The highlight is Theme 32 of repetitive appeals, scheduled for the Full Court this Friday (7), which will define whether it is up to the Labor Court or the Federal Court to judge requests for the release of FGTS denied by Caixa Econômica Federal.

The Superior Labor Court began its second semester judgment sessions this week. The reopening took place on Monday (3), with a session of the Special Body, and the routine of the Panels was resumed on Tuesday (4). The highlight of the opening agenda, however, is scheduled for this Friday (7), at 10 am, when the Full Court will judge the Repetitive Appeal Incident registered as Theme 32.

What is at stake in Topic 32?

The controversy is well-known to those who work in labor litigation: when a worker needs judicial authorization to withdraw funds from their FGTS (Brazilian employee severance fund) account and Caixa Econômica Federal, the fund's operating agent, denies the release, which court should hear the case?

On one hand, there is the understanding that jurisdiction lies with the Labor Courts, since FGTS (Brazilian severance pay fund) deposits arise directly from the employment relationship, which would attract the rule of Article 114, I, of the Constitution. Several decisions by the TST (Superior Labor Court) itself have followed this line in recent years, especially in requests for court orders filed within labor claims or due to situations such as dismissal, serious illness, and the impasses created by the anniversary withdrawal option.

On the other hand, some case law holds the view that the dispute is against Caixa Econômica Federal, a federal public company, and not against the employer. According to this interpretation, jurisdiction would lie with the Federal Court, pursuant to Article 109, I, of the Constitution, an understanding that aligns with Precedent 82 of the Superior Court of Justice, according to which cases related to the movement of FGTS (Brazilian severance pay fund) fall under the jurisdiction of the Federal Court, except for labor claims.

Impacts of the Decision and Formation of Precedents in the TST (Superior Labor Court)

The divergence generated conflicting decisions between Regional Courts and even internal incidents in opposing directions. Therefore, the TST (Superior Labor Court) referred the matter to the repetitive appeals procedure and, since 2025, has ordered the nationwide suspension of appeals dealing with the subject, which await the final pronouncement of the Full Court.

The legal precedent established in this ruling will be binding on all Labor Courts and Regional Labor Courts in identical cases. In practice, the decision will unblock thousands of currently suspended cases and provide a clear direction for new lawsuits: either the Labor Courts consolidate their jurisdiction over these claims, including those against Caixa Econômica Federal (a Brazilian bank), or the lawsuits will be transferred to the Federal Courts, with the ongoing cases being sent to them. Topic 32 opens a period in which the Superior Labor Court (TST) intends to accelerate the formation of precedents. In the first half of the year, the Court settled eight issues in repetitive appeals, but 98 incidents remain pending judgment on the merits. To address this backlog, the Court's president, Minister Luiz Philippe Vieira de Mello Filho, announced extraordinary plenary sessions on Wednesdays during weeks without in-person sessions of the Chambers, in addition to the analysis of more than one incident per session.

Among the issues already ready for judgment is IRR 149, which will discuss the validity of a collective agreement that extends the workday, a matter of direct interest to companies.