NLRB’s Changing View on Penalties and ETS Implementation on a Union Workforce

By Anthony Kaylin, courtesy of SBAM Approved Partner ASE

The General Counsel to the National Labor Relations Board (NLRB), Jennifer Abruzzo, continues her strict interpretation on protecting employees from employers who may be violating their rights.  For example, although the NLRB does not have the authority to impose fines, penalties, or punitive damages on an employer, it does have significant remedial authority to provide “whole relief” to the charging party.  Abruzzo wants to extend the definition of “whole relief” to incorporate what are, in effect, penalties, which could target union employers implementing OSHA’s Emergency Temporary Standards (ETS).

Abruzzo wants to impose penalties on employers who violate employee rights, arguing the NLRB may have that right by law.  On September 15, 2021, she issued two memoranda directing regional offices to pursue an expanded array of remedies against employers in unfair labor practice cases, including the imposition of damages in discharge cases.   Abruzzo justified this new approach because these damages seek to compensate employees for other economic losses suffered as a direct and foreseeable result of their termination, such as interest or late fees incurred on credit cards they used to cover living expenses, penalties incurred by the employee for prematurely withdrawing money from an investment or retirement account to cover living expenses, and loss of a home or car due to the employee’s inability to keep up with loan payments.

The Democrats agree and included language for these fines and penalties in the Build Back Better reconciliation bill, but the bill is still pending.  The Build Back Better would allow the NLRB to impose civil penalties of up to $100,000 for violations of the NLRA if an employee is discharged or faces “other serious economic harm” and includes individual liability for corporate officers and directors for these civil penalties.   

However, this inclusion of language in the bill should belie Abruzzo’s position that the NLRB has the right to impose such penalties.

On November 10^th, Abruzzo issued a memo on OSHA’s ETS and union bargaining obligations.  Generally, an employer under the NLRB has two approaches to bargaining.  First, decisional bargaining refers to an employer’s obligation to bargain with the union before implementing a change to the terms and conditions of employment. Second, “effects bargaining” refers to an employer’s obligation to bargain about the effects of the decision.  Under the memo issued by Abruzzo, she states that employers have both obligations with respect to a union workforce.

The memorandum stated that “covered employers would have decisional bargaining obligations regarding aspects of the ETS that affect terms and conditions of employment.”  It also states that employers have an obligation to bargain about the effects of the ETS policy on employees, including, for example, whether to provide leave to employees who test positive for COVID-19 or how to treat employees that refuse to become vaccinated or submit to regular testing.

The Memorandum also notes that “[t]o the extent elements of the ETS do not give covered employers discretion,” covered employers with unionized workforces still would be “obligated to bargain about the effects of the decision.”  It also implies that even if there was no ETS, or the ETS was struck down by the courts, employers still have no right to impose any vaccine mandates like what is found in the ETS without bargaining with the unions.

The long and short of it is that union employers, according to Abruzzo, do not have unfettered right to impose and implement the terms and conditions imposed by the ETS, whether the ETS is legal or not, without bargaining with the unions.  But the courts have not definitively ruled one way or another, with one federal court in Tennessee questioning, but not ruling for, whether any COVID-19 requirements would have to be negotiated with a union, while federal courts have upheld vaccine mandates on airlines, public employees, and healthcare workers, regardless of their union affiliation.

Regardless of the outcome of the ETS, the memo shows the aggressive nature of the “new” NLRB and the chilling effect of trying to impose penalties on employers.  Union employers need to work with legal counsel proactively to determine strategies to take if such a situation arises.  It is unlikely without the Build Better Back law, a court would uphold NLRB penalties or “damages” at this time.