Brazil Labor Debt Update Under ADC 58 and Law 14,905: The Three Timeline Segments
Correcting a Brazilian labor debt is not multiplying the amount by a single index: between the credit due date and the calculation target date, at least two legal milestones swap the applicable index partway through, and ignoring that stitching is the most common mistake in liquidation math.
The three regimes, in chronological order
From the credit original due date until the lawsuit is filed, the index is IPCA-E plus TRD (Daily Reference Rate, article 39 of Law 8,177/1991), the phase called pre-judicial; it is the segment many calculations skip straight past to SELIC, forgetting the credit was already being corrected before it became a lawsuit.
From the filing date until August 29, 2024, the index is SELIC exclusively, with no separate interest charge, under the Brazilian Supreme Court decision in ADC 58 and ADC 59; SELIC here already bundles correction and interest into the same rate, so adding a separate correction index in this segment would double-count it.
From August 30, 2024 onward (the milestone set by the TST transition ruling in SDI-1 E-ED-RR-713, published October 25, 2024), the regime becomes IPCA (Civil Code art. 389, sole paragraph) plus the Legal Rate (Civil Code art. 406, CMN Resolution 5,171/2024) added together, since Law 14,905/2024 split correction and interest back into two separate components.
A 2022 credit crossing all three regimes
Segment 1: due date to filing
Input
Vencimento 2022-01-05, ajuizamento 2023-06-01
Expected output
IPCA-E + TRD, fator de correção de aproximadamente 1,092
This is the only segment grounded in article 39 of Law 8,177/1991; if the credit arose after the lawsuit was already filed, this segment simply does not exist.
Segment 2: filing to Aug 29, 2024
Input
De 2023-06-01 até 2024-08-30
Expected output
SELIC exclusiva, sem juros apartados, fator de correção de aproximadamente 1,149
No interest is added separately here: the SELIC index for the period is itself the full rate applied to the balance, which is the core of what the ADC 58 ruling decided.
Segment 3: from Aug 30, 2024 onward
Input
De 2024-08-30 até a data-alvo
Expected output
IPCA mais Taxa Legal somados separadamente, juros de aproximadamente 15% no trecho
Some TST rulings write this index as "IPCA-E" instead of "IPCA" due to a wording divergence; that is why the post-cutoff index parameter is adjustable, and it is worth checking which wording the specific ruling used.
Full tool FAQ
IPCA-E for monetary correction and TRD for interest (art. 39 of Law 8.177/1991), per the STF's ADC 58. This is the pre-lawsuit phase, from the claim period to the filing.
Frequently asked questions
Why can a single index not be used from start to finish?
Because the Brazilian Supreme Court (ADC 58/59) and later Congress (Law 14,905/2024) changed the labor debt correction regime on specific dates; applying today one regime index to a period governed by another produces a value with no valid legal basis for that segment.
What exactly changes on August 30, 2024?
Exclusive SELIC gives way to IPCA (correction) plus the Legal Rate (interest) combined, two components added separately instead of a single rate; this is the date Law 14,905/2024 and the TST transition ruling take effect.
Does the pre-lawsuit segment always exist in the calculation?
No; it only shows up when the credit due date predates the lawsuit filing date. If the debt arose after the lawsuit was already underway, the calculation starts directly in the SELIC regime or the post-Aug-30-2024 regime, depending on the date.
Are IPCA and IPCA-E the same thing in the post-Aug-30-2024 period?
They are different IBGE indices (IPCA-E is the special version traditionally used for court-ordered payments and judicial correction); Law 14,905/2024 wording refers to IPCA, but part of TST case law still writes IPCA-E out of drafting habit, so it is worth checking which one the specific ruling names.