NLRB Issues Quartet of New Cases on Labor Rights

The National Labor Relations Board (NLRB or the Board)—the independent federal agency responsible for enforcing U.S. private-sector labor law—had a busy week. The Board issued four new rulings with significant impacts on labor relations between employers and their employees.

The arguably most significant of the four decisions came on Tuesday, December 13, in a case called Thryv, Inc. (372 NLRB No. 22). In this case, the Board answered the General Counsel’s call to expand the remedies available to employees who are affected by unfair labor practices and violations of their Section 7 rights. Previously, the Board was mostly constrained to awarding employees back pay and reinstatement in situations where they are unjustly terminated in violation of the National Labor Relations Act (NLRA). The Thryv decision held that the Board’s “make-whole remedy” should now be interpreted to allow for employees to be compensated for all “direct and foreseeable pecuniary harm” suffered as a result of any unfair labor practices. The decision explains that, in addition to the loss of earnings and benefits, employees may incur other significant financial costs, such as out-of-pocket medical expenses, credit card debt or other costs that are a direct or foreseeable result of the unfair labor practices, and that these losses should be part of the standard remedy for labor law violations.

The next day, the Board issued another decision in American Steel Construction, Inc. (372 NLRB No. 23). In this case, the Board modified the test used to determine whether additional employees must be included in a petitioned-for unit to render it an appropriate bargaining unit for collective bargaining purposes. The American Steel Construction decision reaffirms the Board’s long-standing principle that employees in the petitioned-for-unit must be “readily identifiable as a group” and share a “community of interest.” However, now when a party argues that a proposed unit must include additional employees, the Board held that the burden is on that party to show that the excluded employees share an “overwhelming community of interest” to mandate their inclusion in the bargaining unit. This new standard allows labor unions to organize smaller groups made up of less than all the employees of a particular employer, which requires fewer votes and typically makes it easier to become certified as the exclusive bargaining representative.

The Board’s third decision came on December 15 in the Sunbelt Rentals, Inc. case (372 NLRB No. 24). Sunbelt reaffirms the relatively long-standing Johnnie’s Poultry requirements that an employer must follow whenever it wants to interview employees in relation to unfair labor practice proceedings before the Board. The standard provides that: “The employer must communicate to the employee the purpose of the questioning, assure him that no reprisal will take place and obtain his participation on a voluntary basis; the questioning must occur in a context free from employer hostility to union organization and must not be itself coercive in nature; and the questions must not exceed the necessities of the legitimate purpose by prying into other union matters, eliciting information concerning an employee’s subjective state of mind, or otherwise interfering with the statutory rights of employees.”

Finally, the Board closed out the week with a case called Bexar County Performing Arts Center Foundation (Bexar County II) (372 NLRB No. 28). This case overturns a 2019 case (Bexar County I) and modifies the standard governing off duty workplace access for employees of contractors. In short, the decision makes clear that a property owner may only exclude the employees of its contractors from engaging in protected concerted activity on the worksite if such activity would significantly interfere with the use of the property, or where exclusion is justified by another legitimate business reason.

All four decisions were split 3-2, with the three Democratic-appointed Board members voting in the majority and the two Republican-appointed members dissenting. The decisions continue to swing the labor law pendulum back in favor of employees and labor organizations under the new administration. If you have questions about these decisions or your rights under the NLRA, contact a member of our Labor Management Relations group at your convenience.