NLRB Clarifies That Workers Are Entitled to Comprehensive Make-Whole Remedy for Financial Consequences of Unfair Labor Practices

By Jordan Konell & Joseph D. Richardson

In Thryv, Inc., a decision announced on December 13, 2022, the National Labor Relations Board (NLRB) stated clearly for the first time that its make-whole remedy includes “direct or foreseeable pecuniary harms resulting from” violations of federal labor law. The Board’s announcement indicates a renewed interest in full enforcement of federal labor law and promises to fix what has been an ad hoc and at times inconsistent approach to remedying the complex economic harms faced by employees as a result of labor-law violations.

This case involved an unfair labor practice charge that was filed after Thryv, Inc., an advertising company, laid off six employees without first bargaining with their Union—a clear violation of federal labor law that the Board unanimously found to be unlawful. It was in addressing the remedy for that violation, however, that the Board announced a significant restatement of policy: a majority of the NLRB’s five members joined a decision clarifying that the Board’s standard remedy now includes making employees whole for “direct or foreseeable pecuniary harms” of unfair labor practices to “ensure that employees are more fully restored to the situation they would have inhabited but for a respondent’s unfair labor practice.”

In considering what types of “compensation for direct or foreseeable pecuniary harms” may be appropriate, the Board cited several instances in which it remedied some form of foreseeable pecuniary harm, including its 2021 decision in Voorhees Care & Rehabilitation Center. In that case, the Board ordered an employer that eliminated employee health insurance and later replaced it with inferior coverage to reimburse those workers for the costs they incurred as a result, including substantial out-of-pocket medical expenses incurred for treatment while their coverage had lapsed, and to pay any related outstanding unpaid medical bills.

The Board also quoted from Chair McFerran’s comment in that case, in which she described several foreseeable harms that could befall an unlawfully discharged employee, including interest and late fees on credit cards, penalties for early withdrawals from a retirement account to cover her living expenses, the loss of a car or home, or increased transportation or childcare costs. And, although the Board did not decide what types of harms would be covered under the “direct and foreseeable” standard, it noted that employees “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,” presumably signaling that those types of costs might be included in a make-whole remedy.

This decision is effective retroactively to all pending NLRB cases. The experienced labor attorneys at Willig, Williams & Davidson are available to offer guidance to clients on the impacts of this decision, especially in light of matters that are currently pending before the NLRB.