Busy Before the New Year: Three Recent NLRB Decisions That Will Impact Employers

Last week, the National Labor Relations Board (NLRB) continued its efforts to effectuate a strong national labor policy focused on advancing the organizational rights of workers and encouraging collective bargaining. Three recent decisions take aim at enhancing available remedies in unfair labor practice cases and facilitating organizing among smaller bargaining units.

First, on December 13, 2022, the NLRB held that consequential damages are available as part of a “make-whole” remedy. In Thryve, Inc., the NLRB found that employers can be liable for consequential damages and that consequential damages require employers to compensate workers for “all direct or foreseeable” harms that result from an unfair labor practice. The NLRB said these types of remedies could be used to compensate workers beyond back pay – the most common remedy for workers who suffer damages as a result of an employer’s unfair labor practice. Consequential damages can include reimbursement for various costs such as medical expenses that workers paid out of pocket after losing their health insurance coverage due to an unlawful termination. The NLRB majority explained that this additional remedy can be used in any case in which the NLRB would traditionally order a party to make an employee whole and will not be reserved only for unusual cases.

The NLRB explained that the additional remedies are a necessary extension of the NLRB’s authority to make workers whole and is consistent with prior NLRB precedent. Although the majority did not provide an exhaustive list of possible consequential damages, it did mention medical expenses and credit card debts as possible examples. According to the NLRB, employers will still be afforded the opportunity to challenge any such award and argue the harm was neither direct nor foreseeable or that the harm would have occurred regardless of the unlawful conduct.

The next day, on December 14, 2022, the NLRB issued a second significant decision, this time returning to the Obama-era test used to determine whether additional employees must be included in a petitioned-for unit. The NLRB’s decision in American Steel Construction makes it easier for unions to secure representation elections for bargaining units that are narrower than the facility’s entire workforce.

In American Steel Construction, the NLRB held that employers seeking to broaden bargaining units’ scope must show workers outside the union's proposed group share an overwhelming community of interest with the included employees. The burden is on the non-petitioning party, i.e. the employer, to meet the overwhelming community of interest standard. An overwhelming community of interest means the interests of the petitioned-for and excluded employees must overlap almost completely to mandate inclusion. In short, the impact of the American Steel Construction decision is to make it easier for unions to organize a smaller number of employees, which makes it easier for those same unions to win a representation election. 

Finally, on Friday, December 16, 2022, the NLRB issued a third decision aimed at facilitating organization. In Bexar County Performing Arts Center (Bexar County II), the NLRB held that workers protesting on a third-party employer’s property may not be ejected from the property unless those workers “significantly interfere” with the use of the property or where the owner has some other “legitimate business reason” to remove the protesters. This decision overrules a case decided in 2019 by a Republican-majority Board that held protesting one’s employer on a third-party employer’s property is only protected where the protesting workers “regularly and exclusively” work on the third-party employer’s property. Moreover, the property owner could also show that the protesting workers had alternative means of protest that did not require the use of its property. Under this standard, employers had increased control over presence of off-duty contractors on their property.

The return to the pre-2019 significant interference standard will make it more difficult for employers to freely regulate the use of their property by contractor employees protesting their respective employers. The dissenting members reasoned that this decision cuts against employer’s property rights in contravention of the Supreme Court’s decision in Lechmere v. NLRB which held that employers may lawfully eject non-employee union organizers from their property. Employers will now have to demonstrate that off-duty contractors engaging in some protected protest on their property – even when that protest is against a different employer – significantly interfered with the employer’s use of its property. This exacting standard will be difficult to show, and most peaceful protests may be protected. 

Union and non-union employers should take note of these decisions. The potential liability of make whole remedies will be significantly higher with the inclusion of consequential damages. Moreover, without clear guidance or defined case law, there are no clear parameters or limitations as to what expenses an aggrieved worker could attempt to recoup. Similarly, under the American Steel Construction decision, it is now easier for unions to organize parts of an employer’s workforce, creating new challenges for employers confronting an organizing effort. Finally, the NLRB increased the protections for contractor employees engaging in protected protests against their employers on a third-party employer’s property. If you have any questions about these decisions or how they may impact your business, please contact an attorney on the Faegre Drinker labor and employment team.

Faegre Drinker Law Clerk Samantha Kannmacher assisted with this article.