The 22-year-old former West Brom man is manager Alan Knill's first signing since arriving at Plainmoor.
''Joss is a big, powerful player who can also pass the ball," Knill told the club's official website. ''I first came across him when he was at West Brom and I've watched him grow up from there.
''He has always been someone that I thought I'd like to sign and never really had the opportunity. Whenever my teams have played against Joss, I've always thought he was a good player.
"When I became aware he was available, it was an easy decision for me."
Labadie, who has made 25 appearances this season, will be involved when the Gulls welcome Oxford this Saturday.
Torquay are two points above the relegation zone having not won since January 28.