Employment Law, Johnson & Bell

NLRB Adds Compensation to Remedies for Labor Violations

December 14, 2022

In early December 2022, the National Labor Relations Board added another remedy for unfair labor practices -- requiring employers to compensate workers for "all direct or foreseeable" harms that resulted from a labor law violation.

In a 3-2 decision, the board said it will order remedies that compensate workers beyond providing back pay when employers violate the National Labor Relations Act, shifting the agency's remedial standards in a decision that resets precedent. The majority said the additional remedy will not be restricted to extraordinary cases, but rather can be used in any case in which the board would traditionally order an employer to make a worker whole.

"Employees are not made whole until they are fully compensated for financial harms that they suffered as a result of unlawful conduct," NLRB Chair Lauren McFerran said in a statement. "The board clearly has the authority to comprehensively address the effects of unfair labor practices. By standardizing the board's make-whole relief to fully include the direct or foreseeable financial harms suffered by affected employees, we will better serve the important goals of the National Labor Relations Act."

Members John Ring and Marvin Kaplan dissented from the majority's ruling, saying the remedy goes too far and could run into constitutional issues.

U.S. Supreme Court case law bars the NLRB from imposing penalties on labor law violators, limiting the agency to remedies that make workers "whole" for violations. The board typically seeks financial remedies to correct NLRA violations such as discriminatory firings, most frequently making employers cough up the back pay workers would have earned had they not been fired.

The board issued its ruling in the case, Thryv Inc. and International Brotherhood of Electrical Workers, Local 1269, case number 20-CA-250250, upholding a ruling that the company illegally withheld information about a round of layoffs.

If you have questions about how this development may affect your organization, please contact Johnson & Bell Employment attorneys Christopher J. Carlos, Caroline K. Vickrey or Michael R. Sherer.

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