The 2nd Panel of the Superior Labor Court (TST) ruled that, when compensation is denominated in a foreign currency, the amount must be converted to reais using the dollar exchange rate on the date of hire and, from that point forward, be subject to the statutory or category-specific adjustments. In the panel’s view, it is not appropriate to base the calculation of the differences on the exchange rate during the period worked.
A Colombian ship captain, hired to work in Brazil, claimed that his compensation was set in dollars and that, due to exchange rate fluctuations throughout the contract period, the amount converted to Brazilian reais had decreased. Based on this, he sought back pay and related benefits.
The Regional Labor Court of the 1st Region (TRT1) granted the worker’s request and, for the calculation, ruled that the pay stubs, the highest salary indicated in the case file, and the official dollar selling rate linked to the period worked should be considered, with corresponding adjustments to the other payment components. The companies appealed to the Superior Labor Court (TST).
The reporting judge for the appeal, Justice Liana Chaib, noted that the TRT based its calculation of the differences on the highest salary and the dollar exchange rate linked to the period worked—a criterion that diverges from the TST’s understanding regarding the conversion of payments into the national currency.
According to the reporting judge, the Court’s case law considers the setting of wages in foreign currency to be invalid and establishes that, for calculation purposes, the amount set in dollars must be converted to reais at the exchange rate on the date of hiring. From that point on, the salary adjustments provided for in labor legislation or in the industry’s regulations apply, with the higher amounts being applied in the event of future exchange rate fluctuations. This guidance stems from Article 463 of the CLT, which requires payment in the national currency.
The decision was unanimous.
Source: https://bit.ly/4d30i4Z
