Pejotização at Brazil's Supreme Court: what Tema 1389 means for HR

Brazil's Supreme Federal Court (STF) has not yet decided whether companies may lawfully hire workers through their own legal entity (a PJ, or pessoa jurídica) or as self-employed contractors when the relationship looks like employment, a practice known in Brazil as pejotização. The issue is before the court as Tema 1389, a case with repercussão geral (general repercussion, meaning the ruling will bind all courts) and Justice Gilmar Mendes as rapporteur, and there was still no trial date as of September 19, 2026. Meanwhile, since June, lawsuits on the subject have been moving again in first-instance labor courts and the TRTs (Regional Labor Courts), after more than a year of nationwide suspension.

This article reflects the status of the case on its publication date.

What the STF will decide

The leading case is ARE 1.532.603, in which the TST (Brazil's Superior Labor Court) rejected an employment relationship between an insurance broker and an insurer linked by a franchise agreement. The STF recognized general repercussion on April 12, 2025, and the thesis it sets will apply to all similar cases. According to Agência Brasil, the public news agency, the full court will answer three questions:

1. Jurisdiction: whether labor courts alone may hear claims of fraud in civil service contracts.
2. Lawfulness: whether hiring a self-employed worker or a legal entity to provide services is legal, in light of the STF's ruling on outsourcing of core activities.
3. Burden of proof: whether the worker or the company must prove that the contract was signed to defraud an employment relationship.

According to the rapporteur, the case covers all forms of civil and commercial contracting, not just franchises. Relationships intermediated by apps, such as those of drivers and couriers, were left out and are handled under Tema 1291.

In February 2026, according to InfoMoney, the PGR (Brazil's Office of the Prosecutor General) argued that alternative forms of hiring outside the employment relationship are constitutional and that ordinary civil courts should rule first on the validity of these contracts. The opinion is not binding on the STF.

What changed in June 2026

In a decision released on June 18, 2026, Justice Gilmar Mendes lifted the nationwide suspension ordered on April 14, 2025, for the first and second levels of the labor courts. According to the TST, the rapporteur found that the freeze had caused a significant backlog of cases. In practice:

• First-instance courts and TRTs have resumed hearing witnesses, gathering evidence and issuing rulings.
• After the TRT's decision, the case is suspended at that court, with no deadline opened for a recurso de revista (the appeal to the TST), under a June 19 order detailed by TRT-15.
• At the TST, cases on the subject remain on hold until the final ruling on the thesis.

In other words, the evidence a company has, or lacks, counts now.

Lawful outsourcing is not pejotização

Since Lei 13.429/2017 and Lei 13.467/2017, Lei 6.019/1974 has allowed companies to transfer the performance of any activity, including their core business, to a service provider with compatible financial capacity. In 2018, the STF confirmed that outsourcing core activities is lawful (ADPF 324 and Tema 725), with the client keeping subsidiary liability and the duty to check the provider's reliability and financial capacity.

Aspect	Lawful outsourcing	Irregular pejotização
Who is hired	A company with its own structure and staff	The worker personally, through a CNPJ (company tax ID)
Who directs the work	The provider, which hires, pays and directs its employees	The client, as if it were the employer
Workers	Registered by the provider under the CLT (Brazil's Consolidated Labor Laws)	Unregistered, with an employee's routine
Client's risk	Subsidiary liability	Direct recognition of employment

Lei 6.019 also sets an 18-month quarantine: a company whose owners provided services to the client during that period cannot be hired, unless they are retirees (art. 5-C), and a dismissed employee cannot return to the same company as an outsourced worker before that period ends (art. 5-D).

Signs of an employment relationship

Under the CLT, an employee is an individual who provides services on a non-occasional basis, under the employer's direction and for a salary (art. 3), and acts intended to defraud labor law are null and void (art. 9). Since 2017, art. 442-B has provided that hiring a self-employed worker who meets all legal formalities, with or without exclusivity, rules out employee status. In labor courts, however, what weighs most is how the work actually happens. The most common warning signs:

• Subordination: fixed and monitored hours, direct orders, targets and penalties like an employee's.
• Personal service: the PJ cannot send someone else in their place.
• Habituality: continuous work, built into the team's routine.
• Salary-like pay: a fixed monthly amount unrelated to deliverables, with informal “vacation” or “13th salary” payments.
• Integration: the same badge, email, uniform and schedule as employees, or a former employee rehired as a PJ.

Risks for the company

If an employment relationship is recognized, the company owes the rights for the whole period, with registration, charges and contributions, and may be fined R$3,000.00 per unregistered employee (R$800.00 for micro and small businesses) under art. 47 of the CLT. Workers can claim the last five years, in a lawsuit filed up to two years after the contract ends (Federal Constitution, art. 7, XXIX).

A simplified example: a PJ paid R$8,000.00 a month for three years has the employment relationship recognized. Just three items add up to R$79,040.00:

Item	Calculation	Amount
13th salary (year-end bonus)	R$8,000.00 × 3	R$24,000.00
Vacation + 1/3 bonus	(R$8,000.00 + 1/3) × 3	R$32,000.00
FGTS (severance fund, 8%)	R$640.00 × 36	R$23,040.00
Total		R$79,040.00

The calculation leaves out the 40% FGTS fine, double vacation pay, overtime, termination pay, social security contributions, interest and inflation adjustment.

How HR should review contracts

1. Compare paper and practice: for each PJ, MEI (individual microentrepreneur) or self-employed contractor, check with managers whether there are monitored hours, direct orders or no possibility of substitution.
2. Separate processes: PJ contractors should not be on employees' schedules, time clock or internal rules.
3. Align contract and practice: scope defined by deliverables, autonomy over methods, the possibility of substitution and freedom to serve other clients.
4. Regularize when the routine is an employee's, with legal support, instead of waiting for the thesis.
5. In outsourcing, monitor the provider: reliability, financial capacity and registration of the assigned employees.

In lawful outsourcing, the provider is the one that records its team's hours, schedules and documents. In TIRVU+, for example, payslips, documents and announcements are available in the employee portal, with electronic signatures valid under ICP-Brasil (Brazil's public key infrastructure), which helps show the client who employs the assigned team, the subject of our article on the client portal in outsourcing.

What PJ workers need to know

• The STF has not decided yet; until it does, the CLT and case-by-case analysis apply.
• A PJ contract is not prohibited, but a CNPJ does not remove rights if, in practice, there is subordination, personal service, habituality and salary-like pay.
• As a PJ, you pay your own taxes and are not entitled by law to FGTS, a 13th salary or paid vacation. Factor this into the price you negotiate.
• Keep records of how the work happens, such as messages, schedules and payment receipts. The deadline to file a labor claim is up to two years after the relationship ends.

What to do now

• List contracts with PJs, MEIs and self-employed workers and rank them by risk
• Remove PJ contractors from employees' schedules and time clock
• Check the 18-month quarantine before hiring former employees
• Review clauses on scope, deliverables, autonomy and substitution
• Document oversight of outsourcing providers
• Review provisions for pending lawsuits, which are being heard again
• Follow the Tema 1389 ruling

Frequently asked questions

Is hiring PJs prohibited?

No. The law allows hiring self-employed workers and companies, and the STF has already upheld outsourcing of any activity. The risk lies in using a PJ contract to disguise an employment relationship.

What happens when the STF rules on Tema 1389?

The thesis will apply to all similar cases, including those waiting at the TRTs and the TST, and should define who hears these cases, when such hiring is lawful and who must prove fraud.

Is outsourcing core activities still allowed?

Yes. Lei 6.019/1974 and the STF allow outsourcing of any activity, with a provider that has financial capacity and directs its own employees. Tema 1389 deals with hiring the worker personally as a PJ.

Conclusion

Tema 1389 is likely to redefine the rules for PJ contracts, but it still has no trial date, and lawsuits are being heard again. For HR and payroll, the best stance is not to bet on the outcome: review contracts, separate outsourcing from pejotização and fix routines that look like employment. The same logic of organized records applies to PPE control in outsourcing.

Want to organize documents, announcements and signatures for your registered team, with ICP-Brasil validity? Talk to the Tirvu team and see TIRVU+ working in your own operation.

Sources

• TST: STF lifts suspension of pejotização cases (Jun 18, 2026)
• TRT-15: Notice GP-VPJ-CR nº 001/2026 (Jul 7, 2026)
• Agência Brasil: STF suspends pejotização lawsuits nationwide (Apr 14, 2025)
• InfoMoney: PGR opinion in Tema 1389 (Feb 6, 2026)
• ConJur: Gilmar Mendes lets pejotização cases resume (Jun 18, 2026)

This content is for informational purposes only and does not replace specialized legal advice.