Brazil's Supreme Federal Court (STF) is on course to delay rulings with direct effects on workers, companies and public accounts because of its institutional crisis. According to Folha de S.Paulo, cases on PJ contracting, app-based work, the 2019 pension reform and tax law are stalled while the court deals with the Banco Master affair. Specialists consulted by the newspaper expect the labor and social security cases to remain undecided until after this year's elections, possibly slipping to 2027.
How the crisis began
The deadlock traces back to investigations into Banco Master, now defunct. The case's rapporteur, Justice André Mendonça, lifted the seal on Federal Police reports, and one of the documents, according to G1, pointed to 52 messages between the bank's founder, Daniel Vorcaro, and Justice Alexandre de Moraes, along with in-person meetings and a 130 million reais contract between the bank and the law firm of Moraes's wife. No justice has been charged or convicted. What the full bench was debating is whether to open a formal inquiry into Moraes, a first against a sitting member of the court.
At an extraordinary session on Tuesday (15), the justices voted 4 to 3 to keep separate the reviews of Moraes's conduct, regarding his ties to Vorcaro, and of Mendonça's handling of the rapporteurship, according to G1. Fachin, Mendonça, Fux and Cármen Lúcia backed the split; Gilmar Mendes, Zanin and Moraes wanted a joint review. Before the end, Justice Flávio Dino asked for time to study the case, a "pedido de vista" that suspends the trial for up to 90 days, a window that runs into December.
"I have to interrupt this situation because we have a point of order. We are in no condition to deliberate. The climate is going from bad to worse, and society is watching something different from the procedure the law mandates," Dino said.
In the dispute, Moraes has accused Mendonça of bias and of pressing the Federal Police to include him in a plea deal. "Who is afraid of the Federal Police?", he asked. Mendonça replied: "That is a lie." The rapporteur also denies releasing files selectively and says he kept under seal only what was needed to protect ongoing investigations and third-party data. Justice Kassio Nunes Marques recused himself from voting because he chairs the Superior Electoral Court (TSE) in an election year, and Justice Dias Toffoli declared himself conflicted out.
What is left waiting
With the bench tied up in the Master case, decisions with broad economic reach have no date set: the validity of PJ contracts, the employment status of ride-hailing and delivery drivers, and disputes over the 2019 pension reform, which shapes the deficit of the INSS, Brazil's social security institute. "PJ contracting is an even more central issue because it can reach different sectors of society and produce effects not only on workers' rights, but also on social security and other structures of social protection," Olívia Pasqualeto, a professor at the Getulio Vargas Foundation law school in São Paulo, told Folha. In her view, the ruling will affect companies that rely on such contracts and workers hired as PJs, and the ideal moment to decide is one of calmer tempers, though she considers the debate already sufficient for a ruling.
The next move belongs to court president Edson Fachin: keep the September 23 session on Moraes's accusations against Mendonça or postpone it, as justices aligned with the rapporteur want. If Dino does not return the case within the 90 days, it automatically goes back on the docket.