NLRB Opens Door to Additional Remedies for Repeated Labor Violations

On April 20, 2023, the National Labor Relations Board (NLRB) imposed a host of expanded remedies against an employer that allegedly committed a number of repeated labor law violations in the context of collective bargaining. The decision signals the Board’s willingness to impose harsh remedies against employers more frequently, in the full spectrum of unfair labor practice litigation. Employers everywhere now face the prospect of defending against requests for harsh remedies when litigating a wide range of unfair labor practice charges.

In Noah’s Ark Processors, LLC d/b/a WR Reserve, Chairman Lauren McFerran and member David Prouty concluded that where an employer has “shown a proclivity to violate” the National Labor Relations Act (NLRA) or has “engaged in egregious or widespread misconduct,” the Board will consider the “full range of established, potential remedies” in order to “encourage compliance with the [NLRA] and offer better protection of employees’ Section 7 rights.” The decision encourages Regional Directors issuing complaints to include requests for extraordinary remedies to purportedly allow the Board to “bring greater consistency” to the imposition of expanded remedial measures.

‘Full Range’ of Remedies Detailed

In Noah’s Ark Processors, the Board detailed a non-exhaustive list of additional potential remedies employers may face in situations where prior unfair labor practices have been committed and an employer is deemed to have “a proclivity to violate” the NLRA:

• Providing employees with an explanation” of their labor law rights;
• Reading the “Notice/Explanation of Rights” to employees, potentially by the supervisors or management officials involved in the violations;
• Making supervisors or managers involved be present at the Notice/Explanation of Rights reading;
• Mailing the Notice/Explanation of Rights to each employee’s home;
• Signing the Notice/Explanation of Rights;
• Publishing the Notice/Explanation of Rights in local media;
• Posting the Notice/Explanation of Rights for an extended period of time
• Allowing “visitation” by Board agents to inspect bulletin boards and records to ensure compliance with the posting order.

The Board noted that these extraordinary remedies are in addition to the expanded make-whole remedies and consequential damages already made available in a December 2022 Board decision.

Background

To justify its decision-making, the Board utilized a somewhat unique fact pattern arising out of labor negotiations dating back to 2018 between Noah’s Ark Processors, a meat processing operation, and a union representing its employees. The employer had previously been subjected to a federal court injunction, contempt findings, sanctions, and unfair labor practice charges and had also been found to have bargained in bad faith and unlawfully declared an impasse. A third round of negotiations ended in January 2020 when the employer once again declared an impasse and implemented its final proposal

An administrative law judge (ALJ) concluded that the employer had again bargained in bad faith and implemented its final contract offer without reaching a “valid, good-faith impasse” in violation of Section 8(a)(5) and (1) of the NLRA. The judge ordered the employer to bargain over the terms and conditions of employment and hold a meeting where the chief executive officer would read a notice to the employees in both English and Spanish.

Board Imposes “Amended Remedy”

The Board agreed that the employer had bargained in bad faith, including by declaring an invalid impasse but found that additional remedies were appropriate. The Board modified the ALJ’s order to include a “broad cease-and-desist provision,” a requirement to make employees “whole for any loss of earning and other benefits” suffered as a result of the unilateral changes to terms and conditions, and to reimburse the union for its bargaining expenses including wages paid by the union to its employee bargaining committee.

The Board also ordered additional remedies, requiring the employer to issue “an explanation-of-rights document” with “clear general examples of unfair labor practices that are specifically relevant to the unfair practices” found in the case and for the CEO to read the notice and explanation of rights at a meeting. The CEO was further ordered to sign that notice, mail it to each employee, and post it for an extended period of one year. Finally, the Board ordered that Board agents be allowed to visit the employer’s facility “to ensure compliance with the extended posting period.”

However, the decision to order the additional remedies was not unanimous. While NLRB member Marvin Kaplan agreed with the Board that the employer had violated the NLRA and agreed with some of the remedies, he dissented from aspects of the decision, which he characterized as an “advisory opinion.” Specifically, he criticized the Board for using the “case not only to order numerous additional extraordinary remedies but also to engage in an extended discussion of extraordinary remedies in general.” In Member Kaplan’s view, the decision is an attempt by the Board to advise the NLRB general counsel “regarding extraordinary remedies she might seek in future cases and (implicitly but unmistakably) even encouraging her to seek them.”

Key Takeaways

The decision in Noah’s Ark Processors provides NLRB Regional Directors with enhanced motivation for seeking the ever-growing and wide-ranging list of Board remedies against employers found to have committed prior unfair labor practices. While “extraordinary remedies” have typically been reserved by the Board for only the most egregious, repeat violators, employers may be faced with a wide array of potential remedies in an increasing number of cases.

Employers that desire to challenge such remedies should consider doing so immediately at the pleading stage and throughout the litigation of unfair labor practice (ULP) charges. Employers that delay challenging remedies contained in a complaint may be barred from doing so at a later time under the Board rules and extant case law. Indeed, the Board in Noah’s Ark Processors reiterated that employers that do not raise “particularized exceptions” to any remedy recommended by an ALJ may lose the right to do so. To the extent Regional Directors use this case to leverage more draconian remedies during settlement negotiations, employers may also find it more difficult to resolve ULP charges on reasonable terms.

Ogletree Deakins’ Traditional Labor Relations Practice Group will continue to monitor NLRB developments and will provide updates on the Traditional Labor Relations blog as additional information becomes available. Important information for employers is also available via the firm’s webinar and podcast programs.