Dec 15, 2022 Labor Relations

NLRB Expands ULP Remedies to Include Damages for “Direct or Foreseeable” Financial Harms

UPDATE: On December 13, 2022, the National Labor Relations Board broadened its arsenal of remedies to include certain pecuniary harms that “were direct or foreseeable consequences of” an unfair labor practice.

In a decision issued Tuesday in Thryv, Inc., 372 NLRB No. 22 (Dec. 13, 2022), the Board ruled 3-2 to expand its traditional make-whole remedies such as back pay and reinstatement, to include additional compensation for pecuniary harms that “were direct or foreseeable consequences of” an unfair labor practice. The decision follows the Board’s Notice and Invitation to File Briefs inviting the parties and interested amici to weigh in on whether the Board should modify its make whole remedy.  

The Board notes in its decision, that in addition to the loss of earnings and benefits, impacted workers may incur significant financial costs, such as out-of-pocket medical expenses, credit card debt, or other costs that are a direct or foreseeable result of unfair labor practices. The Board determined that compensation for those losses should be part of the standard, make-whole remedy for labor law violations.

To obtain this type of remedy, the General Counsel, which prosecutes unfair labor practice cases, will be required to present evidence during compliance proceedings proving the amount of the financial harm, that it was direct or foreseeable, and that it was due to the unfair labor practice. Employers will have the opportunity to challenge the amount, argue that the harm was not direct or foreseeable, or contend that the harm would have occurred regardless of the unlawful conduct. 

Consequences of the Ruling

Under the new precedent, the Board will consider the economic consequences of unfair labor practices in any case that calls for standard make-whole relief, not just the most egregious cases. The Board will apply this remedy retroactively to all cases currently pending.

On its face, this standard leaves employers open to liability for any losses indirectly caused by an unfair labor practice whenever the loss is found to be “foreseeable.” Employer’s may find themselves on the hook for myriad economic expenses such as lapsed credit card, mortgage, or loan payments if found guilty of an unfair labor practice.

Please do not hesitate to contact any of our attorneys if you have questions regarding this new ruling or compliance with the National Labor Relations Act.