In 2025, Brazilian companies faced monumental costs of R$ 50.7 billion in labor lawsuits, a figure that far exceeds the R$ 30 billion budget allocated for Labor Justice, signaling a significant shift in the labor landscape post-2017 reforms. This alarming statistic highlights not only the sheer amount but also the growing impact this financial burden has on productive activity, as real costs have escalated past pre-reform peaks.

Despite intentions to reduce judicial confrontations through the labor reform of 2017, the number of legal disputes has seen a resurgence, with 2.321 million new cases registered in 2025, reflecting an 8.5% increase from the previous year. Interestingly, the total of pending lawsuits exceeded levels recorded prior to the reform, suggesting that merely reducing the number of claims did not sufficiently address the root causes of labor litigation in Brazil.

The legislative changes sought to create more flexible employment contracts and deter predatory litigation by imposing costs on losing parties. However, the data indicates that these reforms have not produced the expected outcomes. Instead, the reality is that labor-related disputes continue to burgeon, indicating a need for re-evaluation of policies aimed at reducing litigation in the labor sector, as the discrepancies in judicial costs pose serious threats to business and economic stability in Brazil.