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The NLRB Significantly Increases Potential Damages in ULP Cases

In July of 2021, Jennifer Abruzzo stepped into the role of General Counsel for the NLRB after being appointed by President Biden. Since that time, Ms. Abruzzo has been vocal regarding her intent to increase the scope of the National Labor Relations Act (NLRA) and overturn decades of prior Board law. This is the most recent example. In a 3-2 decision, the National Labor Relations Board (NLRB) recently greatly increased potential damages in all cases where “make-whole” relief is appropriate. Thryv, Inc., 372 NLRB No. 22 (Dec. 13, 2022).

An unfair labor practice (ULP) charge is a claim brought against an employer for violating the NLRA. This could include situations in which discipline, termination, improper assignments, harassment, etc., are alleged to have occurred in retaliation for engaging in “protected concerted activity,” such as being in a union or simply collaborating with other employees to address terms and conditions of employment. It is important to note – a ULP charge may be filed against an employer even in a non-union setting.

Historically, employees who brought ULP charges against their employer were limited to “make-whole” remedies, such as reinstatement, backpay, and loss recovery benefits. For example, an employee found to be wrongfully suspended for three days would be entitled to back-pay for those three days. An employee found to be wrongfully terminated would be entitled to reinstatement, back-pay, and recovery for lost benefits during the period.

However, under the NLRB’s recent expansion of the scope of these remedies, aggrieved workers will now be able to recover compensation for “any other direct or foreseeable pecuniary harm” they allege to have suffered as a result of an employer’s actions, upon a satisfactory evidentiary showing. (emphasis added).

This action is in line with Ms. Abruzzo’s intention to redefine “make-whole” relief available under the NLRA, as announced in Memorandum GC 21-06, by increasing monetary damages as a remedy for unfair labor practices.

The Decision

The holding in Thryv is clear:

“We conclude that in all cases in which our standard remedy would include an order for make- whole relief, the Board will expressly order that the respondent compensate affected employees for all direct or foreseeable pecuniary harms suffered as a result of the respondent’s unfair labor practice.” (emphasis added).

It is important to note this broad remedy applies in all cases – not just egregious ones. Additionally, the remedy will apply retroactively to any pending cases.

The Decision listed some examples of “direct or foreseeable pecuniary harm,” including but not limited to the following:

  • Legal expenses and fees incurred
  • Cost of clothing (and other personal property) damaged due to discriminatory assignment
  • Medical expenses resulting from an unlawful reassignment
  • Expenses incurred while searching for work after an unlawful termination
  • Amount of investment growth if employee is unlawfully withheld from an employer benefit program
  • Interest and late fees on credit cards
  • Increased transportation or childcare costs

It is likely the Board will continue to flesh out what constitutes “direct and foreseeable pecuniary harms” in later decisions. Expect this list to increase.

Implications

The Board’s expansion of the make-whole remedy will likely lead to increased costs and liabilities for employers facing unfair labor practice claims, as well as litigation. While an appeal on this Decision remains to be seen, it would not be surprising given its significance and widespread impact.

If you have any questions or concerns regarding the NLRB’s expanded remedy, please contact Joel Aziere at jaziere@buelowvetter.com or (262) 364-0250, Rob Buikema at rbuikema@buelowvetter.com or (262) 364-0252, Kirstin Mathers at kmathers@buelowvetter.com or (262) 364-0251, or your Buelow Vetter Attorney.

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