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Top NLRB Lawyer Calls for New Remedy for Unlawful Terminations (1)

Sept. 8, 2021, 6:19 PMUpdated: Sept. 8, 2021, 10:01 PM

Employers could face liability for the economic consequences of unlawfully terminating workers in addition to traditional remedies like back pay and reinstatement, according to the National Labor Relations Board’s top lawyer.

NLRB General Counsel Jennifer Abruzzo advised regional officials to seek consequential damages—a remedy that two board members recently expressed support of potentially adopting—in a memo issued Wednesday. Such damages could cover things like medical expenses that workers had to pay out of pocket because they lost health insurance as a result of being fired in violation of federal labor law.

Abruzzo’s memo, which discusses a variety of remedies for different cases, further signals that the NLRB’s legal arm will take an aggressive approach to enforcing the National Labor Relations Act. Since taking office in July, she’s set forth an ambitious agenda to overturn Trump-era precedents, impose a type of bargaining order on lawbreakers that hasn’t been used in 50 years, and adopt a hawkish approach to seeking court orders.

Even as Abruzzo detailed her approach to the NLRB’s remedial authority, Democratic lawmakers confirmed that they’ll try to give the agency the authority to levy monetary fines as part of their $3.5 trillion budget reconciliation bill.

Abruzzo’s memo focused on what the general counsel’s office can seek to address labor law violations under existing NLRB power.

“The Board possesses broad discretionary authority to fashion remedies to fit the circumstances of each case that comes before it,” Abruzzo said in a statement. “It is so important that we utilize every possible tool we have to ensure that those wronged by unlawful conduct obtain true justice.”

Pay for Consequences

The NLRB general counsel’s office during the Obama administration came up short on a bid for consequential damages. The board in 2016—when it was controlled by a Democratic majority, as it is now—rebuffed the request in its decision in Guy Brewer 43, which involved unlawful terminations.

Imposing that new remedy would require a change in law, but the parties didn’t have a chance to fully brief the issue in advance, the NLRB said. “Accordingly, we decline to order this relief at this time,” the board said in the ruling.

NLRB Chair Lauren McFerran raised the issue last month in the board’s ruling in The Voorhees Care and Rehabilitation Center, which held that a nursing home violated federal labor law by unilaterally changing its health insurance plan without telling employees or their union. That unlawful conduct led to employees not realizing they were uninsured for about six months, with one worker racking up more than $500,000 in medical bills, McFerran said in a footnote.

The case shows it’s time for the board to consider consequential damages, said McFerran, a Democrat who the Biden administration chose to lead the board. John Ring, a Republican who served as NLRB chair during the Trump administration, agreed that the case demonstrates the board may need to impose consequential damages to ensure workers are made whole for labor law violations.

‘New and Alternative Remedies’

The memo shows that Abruzzo isn’t rushing into an attempt to revive Joy Silk bargaining orders, a type of remedy once used when an employer refuses to bargain with a union despite having no good faith reason for doubting the union’s support from a majority of workers as shown through signed cards.

Abruzzo said that while she’s looking for cases that might be appropriate to revive the use of Joy Silk orders, she directed regions to seek Gissel bargaining orders, which effectively replaced Joy Silk orders 50 years ago.

Abruzzo also outlined 10 other types of remedies that can be appropriate to address unfair labor practices committed during union organizing campaigns. She pointed out eight types of remedies that can be used for failure-to-bargain violations.

After reminding regional officials of the tools in their remedies toolbox, she closed with a call for creative thinking.

“I encourage Regions to continue exploring new and alternative remedies to ensure that we are providing the most effective relief possible to those who have been harmed by unlawful conduct,” Abruzzo said in the memo.

(Updated with additional details from memo, NLRB rulings.)

To contact the reporter on this story: Robert Iafolla in Washington at riafolla@bloomberglaw.com

To contact the editors responsible for this story: Andrew Harris at aharris@bloomberglaw.com; Martha Mueller Neff at mmuellerneff@bloomberglaw.com

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