Last week was a busy one for the National Labor Relations Board (NLRB). The agency came out with four significant decisions that either expanded or protected employee rights on issues such as monetary remedies, the right to organize, and the right to protest. Below, we briefly summarize the decisions and discuss their significance.

“Make Whole Relief” for Workers Expanded to Include Consequential Damages

In Thryv, Inc., 372 NLRB No. 22, the NLRB redefined “make whole relief,” its traditional remedy for employer unfair labor practices (ULPs) under the National Labor Relations Act (NLRA). This type of relief––which makes the adversely affected employee whole for losses caused by the employer’s violation––usually consists of back pay (lost wages) for an employee who was unlawfully discharged or denied a job or a promotion. Under the NLRB’s new ruling, “make whole relief” will now include all direct or foreseeable pecuniary harms that result from an employer’s ULP. Direct or foreseeable harms––also referred to as “consequential damages”––can include far more than just back pay. Examples cited by the NLRB include out-of-pocket medical expenses incurred by a former employee who lost health insurance and credit card debt resulting from the loss of a paycheck. As a result of this decision, employers now face much greater exposure to damages for violating the NLRA. Employers may need to adjust their risk calculi with respect to possible NLRA violations, as the consequences of such violations are now unpredictable and potentially severe.

Obama-Era Test for Representing “Micro Units” Revived

In American Steel Construction, 372 NLRB 23 (2022), the NLRB revived an Obama-era standard, previously struck down during the Trump presidency, that makes it easier for unions to represent tailored segments of workers within a workforce. The revived standard—originally articulated in Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB 934 (2011)––impacts disagreements between unions and employers over whether a proposed bargaining unit represents broad enough swaths of workers. Under the Trump-era standard, called PCC Structurals, a bargaining unit was deemed appropriate only if the Union was able to establish that the excluded workers had interests that were “sufficiently distinct” from those in the proposed unit the Union was seeking to represent. That standard made it more difficult for unions to represent small units––for example, those comprised of a single department––often referred to as “micro-units.” Last week’s decision overturned PCC Structurals and revived the 2011 standard from Specialty Healthcare, which provides that bargaining units are only too narrow if they exclude workers who share an “overwhelming” common interest with the proposed unit. This decision flips the burden from unions to employers and makes it easier for smaller segments of workers to unionize based on a specific set of interests.

Limits on Questioning of Employees About Alleged Unfair Labor Practices Affirmed

In Sunbelt Rentals, Inc., 372 NLRB No. 24, the NLRB rejected a challenge to a decades-old standard concerning employers’ ability to question workers about alleged unfair labor practices. In a 1964 decision, Johnnie’s Poultry Co.¸ the NLRB addressed employers’ legitimate need to question employees in order to investigate facts and prepare defenses to ULP charges levied against them. Balancing that need against workers’ rights to engage in protected activity, the NLRB held that employers must provide certain assurances and disclosures to employees before questioning them. Among other things, employers must convey the purpose of the interview, assure the worker that no reprisal will occur based on the answers given, and conduct the interview without hostility or coercion. In Sunbelt Rentals, Inc., the NLRB was urged to abandon the strict Johnnie’s Poultry standard in favor of a “totality-of-the-circumstances” test. The agency declined the invitation, holding that Johnnie’s Poultry provided needed stability and clarity and struck the appropriate balance between employers’ and workers’ interests.

Trump-Era Protections for Third-Party Property Owners Reversed

In Bexar County Performing Arts Center Foundation, 372 NLRB No. 28, the NLRB discarded the Trump-era standard for deciding when property owners can lawfully exclude employees of contractors from holding labor protests on their property. In a 2019 decision in this case, the NLRB held that property owners could exclude contract workers unless they worked “regularly and exclusively” on the property and lacked a “reasonable nontrespassory alternative” for transmitting their message. This ruling was subsequently rejected on appeal and sent back to the NLRB, resulting in last week’s decision. As in other recent cases, the NLRB reverted back to an Obama-era standard—New York, New York Hotel & Casino, 356 NLRB 907 (2011). Under the revived standard, property owners can only bar off-duty contract workers from holding labor protests if they can demonstrate that the protest would significantly interfere with the use of their property or when justified by another legitimate business reason. As a result, the burden is now flipped to the property owners, who will face a tougher battle in ridding their properties of protesting workers.

Conclusion

Over the past week, the NLRB has both peeled back Trump-era rulings in favor of employers and expanded worker remedies in new ways. Although the holidays may provide a short reprieve, we expect a continuation of this trend in 2023. Employers with questions about these and other NLRB decisions should contact their regular Saul Ewing attorney for guidance.