On September 8, 2021, the General Counsel of the National Labor Relations Board (NLRB), Jennifer Abruzzo, issued GC Memorandum 21-06. In this document, the General Counsel announced a startling new direction the NLRB intends to take with respect to seeking “full remedies” against employers who are found to have violated the National Labor Relations Act (NLRA). GC Memo 21-06 is one of four such guidance memoranda recently issued by the General Counsel – with more anticipated – that should cause significant concern for employers.
Relying on the premise that the NLRB has “broad discretionary authority . . . to fashion just remedies,” the General Counsel in GC Memo 21-06 directs each Regional Director to request “the full panoply of remedies available to ensure that victims of unlawful conduct are made whole for losses suffered as a result of unfair labor practices.”
Beyond the traditional notice posting, order to bargain, reinstatement and back pay remedies, the General Counsel identified other options each Region should consider, such as “consequential damages to make employees whole.” Such damages could include, for example, compensation for health care expenses incurred as a result of unlawful cessation of coverage, or credit card late fees, or loss of a home or car, resulting from an unlawful discharge. In making specific reference to unlawful terminations, the General Counsel directed Regional Directors to seek not only the consequential damages previously mentioned, but also front pay (in lieu of reinstatement), and liquidated backpay.
In matters involving unlawful conduct committed by an employer during an organizing campaign, the General Counsel stated it often proved difficult to reinstate “laboratory conditions” free of the effects of the unlawful conduct in order to hold a new election. Accordingly, the General Counsel suggested the following remedies be considered: providing the union with equal access to the employees where the employer engages in captive audience meetings, as well as to employer bulletin boards; requiring the employer to reimburse the union for its organizing costs if a new election is ordered; reading of the actual Notice to Employees by a company official or NLRB representative, with the union present; publishing the Notice to Employees in social media or other forums to ensure all current, former and future employees are aware of its terms; mandatory training of managers and supervisors of employees’ rights under the NLRA; and, among others, replacing an employee who was unlawfully discharged with a new employee selected by the union.
Another important aspect of the General Counsel’s Memorandum is its directive concerning bargaining orders when an employer has been found to have engaged in unlawful conduct during an organizing campaign. In situations where a union presents the employer with evidence that it represents a majority of the employees in the bargaining unit, such as through signed union authorization cards, and the employer cannot establish a good faith doubt as to the union’s majority status, an order to bargain with the union may be deemed appropriate. In such instances, the employees would be denied the opportunity to participate in a secret ballot election to determine whether all of the employees in the unit wish to be represented by a union.
The General Counsel also directed Regional Directors to consider the following remedies in refusal to bargain cases: issuance of bargaining schedules, where the employer is required to bargain at specific dates and times (e.g., two sessions per week, six hours each); periodic reporting to the NLRB of progress at the bargaining table; reinstatement of unlawfully withdrawn bargaining proposals; reimbursement of bargaining expenses during the period when the employer is deemed to have bargained in bad faith; and others.
In GC Memo 21-07, issued September 15, 2021, the General Counsel extended the discussion of remedies to settlement agreements between the employer and the charging party. In addition to those remedies discussed above, the General Counsel encouraged each Region to expand the scope of possible remedies to be included in settlement agreements, such as, for example, compensation for loss of an employee’s credit rating, financial losses for being forced to liquidate a savings account, moving expenses, and legal expenses. In addition, the General Counsel mandated the inclusion of default language in the agreement as well as requiring employers to issue a letter of apology to the aggrieved employee.
Approximately one month earlier, on August 19, 2021, the General Counsel issued a separate Memorandum encouraging the increased use of injunctive relief to enforce the NLRA. (GC 21-05). Although the use (and threat of use) of injunctions is nothing new, the current General Counsel expressly stated she intends to “aggressively seek” injunctive relief “where necessary to preserve the status quo.” In other words, where the NLRB believes an employer has violated the NLRA, and the remedies available are insufficient to protect the rights of the employees affected by the unlawful conduct, the NLRB will ask a court to issue an injunction requiring the employer immediately to cease the alleged conduct until such time as the administrative processes of the NLRB can conclude. Particular cases where such injunctive relief may be pursued include discharges during organizing campaign, violations of Section 7 rights during organizing campaigns that lead to bargaining order, withdrawal of recognition from incumbent unions, and others.
The General Counsel’s intent to be more aggressive in seeking injunctive relief is significant because, as stated in the Memorandum, the NLRB’s success rate in obtaining injunctions is extremely high. In 2021, the NLRB was successful in 91.7% of cases, and in 2020, it succeeded in 100% of cases.
Finally, on August 12, 2021, the General Counsel issued Memorandum GC 21-04, wherein she required Regional Directors across the country to submit certain cases to the Division of Advice for review. The first category of cases is those where the NLRB has overruled precedent in recent years. These include employer policies and work rules, confidentiality and non-disparagement provisions in separation agreements and workplace investigations, employee access to employer email systems and property, union dues, employee/independent contractor classification, and an employer’s duty to recognize and/or bargain with a union. The second category of cases includes other types of employee status determinations, whether a non-union employee has the right to representation during an investigatory interview, other categories of employer refusal to bargain cases, and others. The third category involves various other areas of interest to the General Counsel that do not fall into one of the first two categories.
As is clear from the foregoing summary, the General Counsel’s recent Memoranda are extremely broad and potentially catastrophic to employers who have been deemed to have violated the NLRA. Now more than ever it is important that employers make sure their managers and supervisors are trained on the requirements of the NLRA to minimize the potential for liability. The current administration clearly is making every effort to shift the pendulum in favor of the unions who were extremely supportive during the last election. In addition, employers should be reviewing their employee handbooks and work rules for potential violations of the NLRA in light of the General Counsel’s clear intent to find fault with how such policies are drafted and applied. We will continue to monitor further developments as the General Counsel has indicated further memoranda are forthcoming.
The St. Louis employment attorneys at McMahon Berger have been representing employers across the country in labor and employment matters for over sixty years and are available to discuss these issues and others. As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation as every situation must be evaluated on its own facts. The choice of a lawyer is an important decision and should not be based solely on advertisements.