In a decision issued on December 13, 2022, the National Labor Relations Board (“NLRB”) clarified its make-whole remedy and effectively expanded compensation for victims of labor law violations to include all “direct and foreseeable pecuniary harm” that resulted from the alleged unfair labor practices. Such damages are similar to “consequential damages” in civil litigation.
In Thryv, Inc. and International Brotherhood of Electrical Workers, Local 1269, 372 NLRB No. 22 (2022), the NLRB held that victims of unfair labor practices experience a financial impact beyond mere lost income and benefits. The NLRB recognized that workers may foreseeably incur financial costs such as medical expenses (not covered by a health plan) and credit card debt, stating, “We have previously recognized that employees cannot be fully made whole without consideration for these types of losses.” Id.
Prior to Thryv, Inc., the damages available to individuals affected by an unfair labor practice were limited to direct remedial damages, which generally included back pay and reinstatement. Now, the range of damage types sought by the NLRB is extremely broad, potentially without limit.
In its holding, the NLRB in Thryv, Inc. made compensation for these financial losses a part of the make-whole remedy for unfair labor practices, stating, “we find that standardizing our make-whole relief to expressly include the direct or foreseeable pecuniary harms suffered by affected employees is necessary to more fully effectuate the make-whole purposes of the Act… ”
In order to establish the extent of the financial harm experienced by the worker, the General Counsel will have the burden of introducing evidence in a compliance proceeding proving not only the extent of financial harm, but that the harm was direct or foreseeable and the result of an unfair labor practice. The respondent in the case, generally the employer or labor organization, would then be given the opportunity to present rebuttal evidence.
The NLRB’s decision will apply to all pending and future cases where the standard remedy would include make-whole relief for the worker. The decision is consistent with the NLRB General Counsel’s recent declaration of her intent to seek such broader damages in unfair labor practice cases. (General Counsel Memo 21-06)
McMahon Berger will monitor further developments in this area, particularly anticipated challenges to the decision. Questions concerning its potential impact can be directed to any McMahon Berger attorney.
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.