In 2025, Brazil witnessed a significant rise in dismissals for just cause, reaching a record high of 638,700 cases, marking an almost 200% increase compared to 2019, before the COVID-19 pandemic. This data, sourced from the Cadastro Geral de Empregados e Desempregados (CAGED), highlights the growing trend of employers terminating contracts under strict just cause conditions. In January 2025 alone, there were 65,300 dismissals, representing a 22% increase compared to the same month the previous year.

The proportion of just cause dismissals out of total contract terminations also reached an all-time high at 2.6% in 2025, indicating a shift in labor market dynamics. According to economist Bruno Imaizumi from the consulting firm 4Intelligence, this rise is attributed to a 'perfect storm' within the labor market, characterized by high employee turnover rates, increased monitoring of employees by employers, a return to in-person work after the pandemic, and the influx of Generation Z into the workforce. This trend sheds light on the changing landscape of employment relationships in Brazil.

As the labor market evolves, both employers and employees will need to adapt to these changes, which may reshape employment contracts and workplace expectations. The rise in just cause dismissals raises important questions about worker rights and the conditions under which employees may be terminated, emphasizing the need for ongoing scrutiny of labor practices in Brazil as the nation recovers from the pandemic's impact on the economy.