Pejotização: when a PJ contractor is entitled to an employment relationship in Brazil

**Pejotização is the practice of hiring a person as a "legal entity" (pessoa jurídica, PJ) to do what is, in practice, an employee's job. When personal service, regularity, subordination and pay are present, the Labor Court can recognize an employment relationship — but the issue is under review by the Federal Supreme Court (STF, Theme 1389) in 2026.**

Quick summary

• An employment relationship depends on the requirements of arts. 2 and 3 of the CLT (Brazil's Consolidated Labor Laws), not on the name given to the contract.
• The STF is reviewing the validity of these contracts in Theme 1389, with Justice Gilmar Mendes as rapporteur.
• In April 2025, cases on the issue were suspended nationwide.
• On June 18, 2026, the suspension was lifted for cases up to the 2nd instance (TRTs, the Regional Labor Courts); those at the TST (Superior Labor Court) are still waiting for the STF's ruling.
• The merits have not yet been decided; follow the updates.

Requirements for an employment relationship

• Personal service — only you can do the work; you cannot send someone else in your place.
• Non-occasional work (regularity) — continuous work, tied to the company's routine.
• Subordination — you receive orders, have controlled hours, imposed targets, a direct boss.
• Pay — there is payment for the work.

If these elements are present, the PJ contract may be considered a way of disguising employment (CLT, art. 9).

Common signs of pejotização

• Being required to open a CNPJ (company tax ID) or MEI (individual micro-entrepreneur registration) as a condition for the job.
• Fixed hours, time tracking and a direct boss.
• Using a company email, badge and uniform like employees.
• A fixed monthly payment, with informal "vacation" and "13th salary".
• Being unable to provide services to other companies.

How to gather evidence

1. Keep messages and emails with orders, demands about hours and targets.
2. Save monthly invoices and proof of payment.
3. Record schedules, badge and access to internal systems.
4. Identify witnesses who worked with you.

See more in Evidence in a labor case.

What is claimed in court

Recognition of the employment relationship and the amounts for the period: registration in the work card, vacation + 1/3, 13th salary, FGTS (the Severance Indemnity Fund) + penalty, overtime and severance pay. The deadline is 2 years after the end of the relationship, covering the last 5 years.

Frequently asked questions

Are PJ contractors entitled to vacation and the 13th salary?

If an employment relationship is recognized, yes, with all CLT rights.

Has the STF already ruled on pejotização?

As of October 2026, the merits of Theme 1389 had not been decided. The nationwide suspension was lifted in June 2026 for cases up to the TRTs.

Can I sue the company while I am still a PJ contractor?

Yes, but consider the impact on the relationship. The 2-year deadline only starts running after the services end.

Read more in this series

• CLT worker rights: complete guide
• Evidence in a labor case: how to gather and organize it
• Labor Court: how it works and how to file a claim
• How to find a labor lawyer: free, contingency, court-appointed or private
• Index: complete guide to labor rights