NLRB Adds Enhanced Penalties for Repeat Offenders

On April 20, 2023, the National Labor Relations Board (NLRB or the Board) added a new set of penalties to its remedial arsenal for employers who repeatedly or egregiously violate federal labor law. The new remedies supplement the expanded make-whole remedies and consequential damages established by the Board in its December 13, 2022, decision, Thryve, Inc. For more information about the consequential damages please see our December 2022 alert.

In last week’s decision, Noah’s Ark Processors, the NLRB emphasized the need to have consistent standards for penalizing employers for egregious misconduct. There, the employer engaged in unlawful bad faith bargaining, discriminatory terminations, and unilateral changes to the terms and conditions of employment.

The strongest new remedy allows the Board to order the employer to reimburse the union for bargaining expenses. This includes a make whole remedy for any employee who lost wages for attending a bargaining session when he or she would otherwise be working. Other enhanced remedies authorized by the Board include:

• Instructing offending employers to provide a comprehensive explanation to employees of their rights under federal labor law
• Mandating a reading of the traditional notice posting regarding the employer’s violation and requiring supervisors be present at the reading
• Mailing of the notice posting to employees’ homes in addition to the standard electronic distribution
• Publishing the notice posting to the media
• Increasing the time that the notice posting must be posted
• Permitting compliance officers to physically visit facilities and assess compliance

Traditionally, egregious or widespread misconduct by an employer was remedied with a “broad” cease-and-desist order instructing the employer to refrain from unlawful conduct. Offending employers were also required to post a notice posting in conspicuous places that notified employees of the violation and their rights under federal law. In addition to the cease-and-desist order, the Board may consider imposing any combination of the enhanced remedies. Moreover, the enhanced remedies increase an offending employer’s notice posting obligations to include a wide variety of communications and imposes an additional obligation on employers to permit compliance officers to enter the employers’ premises to monitor compliance. The Board noted the enumerated enhanced remedies was a non-exhaustive list and other remedies could still be crafted.

This decision potentially creates significantly more liability for employers that are found to violate federal labor law. The reimbursement of bargaining expenses and the consequential damages available to aggrieved employees are not yet well defined and could present large costs for employers. Likewise, the availability of future remedies not yet crafted by the Board creates tremendous uncertainty. However, these remedies will only be invoked for egregious and repeat offenders. If you have any questions about the potential implications of these new remedies on your business, please contact an attorney on the Faegre Drinker labor and employment team.