Arbitration in individual labor conflicts: a constitutional and logical-systematic interpretation of article 507-A of the Consolidated Labor Laws (CLT)

Abstract

Article 507-A, added to the Consolidated Labor Laws (CLT) by Statute 13,467/2017 (Labor Reform Act), allows for the possibility of inserting an arbitration clause into individual employment contracts, provided that the presence of this clause derived from the initiative of the employee itself or enjoyed its express agreement.  As is known, the resolution of a conflict via the arbitral route depends on the existence of an arbitration agreement, which can take two distinct forms: an arbitration clause or a compromissum to arbitration. In the light of the provisions contained in article 114, paragraphs 1 and 2 of the 1988 Brazilian Federal Constitution (CRFB/88), previously, in case law, the view prevailed that arbitration was allowed only to resolve collective labor conflicts. In introducing article 507-A to the text of the CLT, the Labor Reform put into effect by Statute 13,467/2017 reopened the debate regarding the applicability of arbitration as an extrajudicial means of resolving individual conflicts in the labor sphere.