May 11, 2023

NLRB Opens the Floodgates for Extraordinary Remedies Available for Egregious or Habitual Violations

The National Labor Relations Board (“NLRB”) recently issued a broad cease-and-desist order against an employer that allegedly engaged in unfair labor practices and also ordered it to reimburse the Union for its bargaining expenses since November 2019 “through the date in the future when good faith negotiations begin” and to read the remedial notice to its employees.  Noah’s Ark Processors, LLC d/b/a WR Reserve, 372 NLRB No. 80 (2023). The NLRB also used the decision to expand the remedies available for allegedly unlawful bargaining behavior.

Noah’s Ark Processors, LLC (“Noah’s Ark”) and UFCW, Local No. 293 (“UFCW”) engaged in negotiations for several years. UFCW filed numerous unfair labor charges against Noah’s Ark including bad faith bargaining and retaliation against bargaining unit employees who exercised their Section 7 rights. A trial was held on the merits, and the Administrative Law Judge (“ALJ”) held that Noah’s Ark bargained in bad faith by: (1) making regressive proposals; (2) being unwilling to consider minor changes by the union and most of the union’s proposals; (3) being unwilling to modify its own initial proposals and to wait for the union to make all of its proposals; (4) making an unreasonable wage proposal, and (5) implementing a last, best and final offer before an impasse. Based the findings, the ALJ ordered Noah’s Ark to (1) resume bargaining with the union; (2) hold meetings for a notice to be read in Spanish and English to employees by the CEO or an NLRB agent with the CEO present, and (3) compensate the union for all bargaining expenses since November 2019 “through the date in the future when good faith negotiations begin.”

Noah’s Ark appealed and the NLRB upheld the ALJ’s remedies and expanded them. The NLRB amended the ALJ’s order to require Noah’s Ark to compensate employees for “any other direct or foreseeable pecuniary harms incurred” based on its “last, best and final offer in the absence of an impasse.” The majority of the NLRB explained that its decision rested on the “nature, severity, and extent” of the violations by Noah’s Ark.

To paraphrase a line from Bull Durham, in an effort to “announce [the] presence with authority” of the NLRB’s General Counsel’s recent memoranda regarding remedies, the majority in the NLRB’s decision went on to explain that “when a broad order is appropriate, the Board will consider at least the following established remedies”:

  1. Adding an explanation of rights to remedial orders;
  2. reading the Notice at a meeting that high-ranking manager or corporate official attend (even though the Courts of Appeal for the D.C., Fifth, and Sixth Circuits have expressed extreme skepticism about the appropriateness of the NLRB’s public notice reading remedy);
  3. mailing the Notice and Explanation of Rights to current and former employees;
  4. requiring the company official who “committed the unfair labor practice found or is viewed by employees as the face of the conduct underlying the violations” to sign the Notice;
  5. publishing the Notice in “local publications of broad circulation and local appeal;”
  6. extending the posting of the Notice and Explanation of Rights beyond the standard 60 days, and
  7. permitting the visitation of NLRB agents to ensure that the Notice is posted, “inspect the records” of the company, and “to take statements from its officers and employees (and others) for the purpose of determining or securing compliance with [Board] orders.”

This decision clearly demonstrates that the NLRB and its General Counsel and Regional Directors will seek increasingly broad remedies for violations of the National Labor Relations Act. Any employer that wishes to challenge such remedies must do so at the pleading stage and continue to do so throughout litigating an unfair labor practice charge. As noted by the Board in Noah’s Ark, if the employer “failed to raise a particularized exception to any of the remedies recommended by the [ALJ],” the NLRB may issue a bargaining order without a justification.

If you have any questions regarding the issues raised in this client alert, please contact your Labor and Employment counsel at Smith, Gambrell & Russell, LLP.

Share via
Copy link
Powered by Social Snap