In a landmark NLRB decision, the Board broadly expanded the monetary award that may be given to prevailing workers in unfair labor practice disputes. Prior to the new Thryv, Inc. and International Brotherhood of Electrical Workers, Local 1269 – (20-CA-251105) December 2022 decision, monetary damages had been limited to “back pay.” This limit has been expanded by the NLRB to award monetary damages to include “make whole” relief.
To make the employee “whole,” examples of additional forms of relief may now include “consequential damages” such as increases in insurance premiums, co-pays, coinsurance, deductibles, and other out-of-pocket expenses, extra medical expenses, expenses incurred in connection with a search for other work, credit card debt interest and late fees on credit card debt, penalties suffered by employees who are forced to make early withdrawals from retirement accounts; and increased transportation or childcare costs.
In this case the California employer, Thryv, Inc., operates a marketing agency engaged in the business of selling Yellow Pages advertising, as well its eponymous product “Thryv,” an application for small businesses. While all parties agree that Yellow Pages advertising has increasingly declined since the advent of the Internet, Thryv still generates annual revenues in excess of $1.1 billion, with print and electronic advertising accounting for 88 percent of that amount.
The Union represents a unit of employees that includes the Thryv outside sales force, which in turn consists of three subsets of “premise” representatives, so named because they go to customer premises to solicit advertising sales.
Around mid-July of 2019, Thryv began implementing its proposal to lay off all of its New Business Advisors in the Northern California Region.
The Assistant Vice President of Labor Relations emailed the Union stating that Thryv “will administer a force adjustment” and lay off the six New Business Advisors in the Northern California Region effective September 20. The email stated, “[i]f the Union desires to exercise its right to meet and discuss the Company’s plan within the 30-day period, please contact [Labor Relations Manager] Ralph Vitales to arrange such discussions.”
The Union and Thryv met several times to discuss the layoff of the New Business Advisors, but failed to arrive at an agreement. And Thryv then unilaterally implemented its layoff decision just nine days after the first bargaining session. While the trial judge did not find this to be unlawful, the NLRB reversed, and found that Thryv “violated Section 8(a)(5) and (1) by unilaterally laying off six New Business Advisors” without responding to the union request for additional documentation it needed to evaluate the offers made by Thryv.
In concluding the appeal, the NLRB next turned to the issue of “the proper remedy.” It went on to conclude “that it is necessary for the Board to revisit and clarify our existing practice of ordering relief that ensures affected employees are made whole for the consequences of a respondent’s unlawful conduct.”
Previously, the Board had issued a Notice and Invitation to File Briefs, which sought briefing on whether the Board should include, as part of its make-whole remedy, “relief for consequential damages.”
In it’s amicus brief, the U.S. Chamber of Commerce pointed out that ” By its terms, Section 10(c) identifies “back pay” as the only monetary relief that the Board can award to employees who suffer harm from an unfair labor practice. On finding that a person has committed an unfair labor practice, the Board “shall issue . . . an order requiring such person to cease and desist from such unfair labor practice, and to take such affirmative action including reinstatement of employees with or without back pay, as will effectuate the policies of [the Act]” 29 U.S.C. § 160(c). That language has been present e unchanged since the Wagner Act’s adoption in 1935.”
Despite arguments by amicus to the contrary, the Board concluded that “in all cases in which our standard remedy would include an order for make- whole relief, the Board will expressly order that the respondent compensate affected employees for all direct or foreseeable pecuniary harms suffered as a result of the respondent’s unfair labor practice.”
In rejecting the argument of the Chamber of Commerce (and several other amicus briefs) the Board supported their ruling by noting “The Supreme Court has held that our authority to fashion such a remedy “is a broad discretionary one.” NLRB v. J. H. Rutter-Rex Manufacturing, 396 U.S. 258, 262-63 (1969), and several other case decisions.
“Make-whole relief” is more fully realized when it consistently compensates affected employees for all direct or foreseeable pecuniary harms that result from a respondent’s unfair labor practice.
Where, as here, employees have been laid off in violation of the Act or been the targets of other unfair labor practices, they may be forced to incur significant financial costs, such as out-of-pocket medical expenses, credit card debt, or other costs simply in order to make ends meet. We cannot fairly say that employees have been made whole until they are fully compensated for these kinds of pecuniary harms if the harms were direct or foreseeable consequences of the respondent’s unfair labor practice. The Board has a “statutory obligation to provide meaningful, make-whole relief for losses incurred by discriminatees . . . . “
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