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Banking Blockages, Suspension of Driver’s Licenses and Passports Generate Legal Debate and Reignite the Discussion About the Limits of Labor Justice
The Labor Justice has been criticized since 2024 for applying measures considered excessive against business owners. The decisions include banking blockages, suspension of driver’s licenses, and confiscation of passports, which has generated significant repercussions.
These actions, according to experts, resemble the Magnitsky Law, U.S. legislation created in 2012 to punish human rights violations and corruption. However, in Brazil, they have started to affect labor and civil debts, which has prompted the nickname “Brazilian Magnitsky Law”.
According to the National Justice Council (CNJ), the application of these measures increased after the pandemic. More than 716,000 micro and small businesses closed between 2020 and 2023, according to data from the IBGE, which worsened the problem.
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Labor Sanctions Affect Small Businesses and Create Domino Effect
The penalties, which were meant to ensure compliance with court decisions, ended up causing severe collateral effects. Small business owners report automatic blockages, loss of credit, and restrictions that prevent the continuity of their activities.
The legal expert Sérgio Cavalieri Filho, a professor at UERJ, explains that “the suspension of driver’s licenses and passports due to debts violates Article 5 of the Constitution and the right to freedom of movement.”
On the other hand, the National Association of Labor Magistrates (Anamatra) argues that such measures are necessary to deter property fraud and ensure payment of judgments. Nevertheless, the legal discussion about the limits of these actions remains open.
In October 2025, Jornal do Brasil published reports showing the human impact of these decisions. Business owners claimed to have been “financially destroyed” by sanctions imposed without negotiation alternatives.
Cases Reveal Drama and Paralyze Activities
A manufacturer from the interior of Rio Grande do Sul, owner of a small pallet factory, stated that he previously employed 50 people before the pandemic. After the crisis, he had to lay off half of his staff and faced 20 simultaneous labor lawsuits, totaling R$ 500,000.
He shared that, with blocked accounts and a suspended driver’s license, he lost the right to drive and now relies on others even to take his children to school.
Another case comes from Rio de Janeiro. A former partner of a metalworking company, 70 years old, found out at the airport that his passport had been seized by a court decision from 2024, related to a lawsuit filed in 1975, when he was still a student. The amount owed exceeds R$ 2 million, and his only property is at risk of seizure.
In Tijuca, a merchant who owns a stationery store with over 60 years of history is also facing daily blockages. The court ordered the partial seizure of his retirement, and he claims that “the Labor Justice turned a small trader into a pariah.”
Experts Warn of Abuses and Call for Urgent Review
The severe sanctions applied by Labor Justice are dividing jurists and economists. Many argue that the judiciary has exceeded its function by imposing personal restrictions in cases of financial nature.
The Supreme Federal Court (STF) has not yet consolidated its understanding on the issue. However, ministers like Luís Roberto Barroso and Gilmar Mendes warn against the disproportionate use of these measures, which affect individual freedom and the economy.
The Ministry of Justice created, in September 2025, a technical group to standardize decisions and prevent abuses, while the Superior Labor Court (TST) analyzes new guidelines for magistrates.
Still, business entities claim that legal insecurity has increased significantly and already affects thousands of entrepreneurs across the country.
Business Entities Press for Urgent Changes
The pressure on the Legislative has grown. In October 2025, the National Confederation of Industry (CNI) and the Federation of Micro and Small Businesses (Comicro) presented to the National Congress a proposal that seeks to limit personal sanctions and protect the right to do business.
According to the Ministry of Justice, the text should be reviewed in March 2026 by the committees of the Chamber of Deputies. The goal is to prevent labor enforcement from exceeding civil collection limits and ultimately restricting individual freedoms.
While the debate does not progress, thousands of business owners continue with blocked accounts, suspended driver’s licenses, and seized passports, which disrupt their routines and impede economic growth.
What Does the Future Hold for Labor Justice?
Legal experts argue that Brazil needs to reassess the balance between labor protection and business freedom. If coercive measures persist, the country may lose competitiveness, jobs, and productive investments.
On the other hand, a balanced reform could restore confidence and strengthen the business environment. This would ensure that the Justice continues to protect workers without stifling those who create jobs.
As changes do not come, thousands of entrepreneurs live under the burden of the so-called “Brazilian Magnitsky Law”, which, even without officially existing, acts silently in the courts and redefines the relationship between Justice and the economy.
What do you think should be a priority for the country: to toughen labor punishments or to ensure the right to do business with freedom and legal security?
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