Tag Archive: National Labor Relations Board

Nov 16

NLRB Adjusts Reimbursement Calculation for Unlawfully Discharged Employees

By Natalie Russell.

In a recent decision issued by the National Labor Relations Board (the “Board”), King Soopers, Inc. and Wendy Geaslin, persons who were wrongfully terminated may receive full reimbursement of search-for-work and interim employment expenses. Case 27-CA-129598 (2016). For over 80 years, the Board has awarded search-for-work damages. However, the Board’s traditional calculation of these damages failed to make a dischargee whole because the search-for-work damages were considered offsets to a dischargee’s interim earnings. This meant that if a dischargee spent more money searching and relocating for an interim job than they actually earned at that job, they would only be repaid up to the amount of the interim wages they earned. Id. at 5. In King Soopers, Inc., the Board found that the traditional approach, which limited the damages, not only “fail[ed] to make victims of unlawful discrimination whole . . . [but also] discourage[d] discriminatees in their job search efforts.” Id. at 5.

Faced with the challenge of balancing fairness to the wrongfully terminated with the authority granted to the Board through Section 10(c) of the National Labor Relations Act (the “Act”), the Board concluded that it has “ ‘broad discretionary’ authority to order remedies that will ‘effectuate policies’ of the Act.” Id. at 3 (quoting NLRB v. J.H. RutterRex Mfg., 396 U.S. 258, 262–63 (1963)). The Board not only has a duty to the wrongfully terminated, but also must create deterrents so that employers are discouraged from engaging in unlawful and discriminatory conduct. Id. at 3. By granting make-whole relief in the form of full reimbursement of search-for-work and interim-employment damages, the Board has fulfilled its duty.

The story of Juana Perez is a primary example of the positive impact make-whole relief will have on the wrongfully terminated. Ms. Perez worked at a location, earning $1,000 per month prior to her unlawful discharge. In seeking interim employment, Ms. Perez spent $6,000 on relocation costs, training, and job searching. She ultimately found employment, earning $750 per month for two months. Under the Board’s traditional reimbursement approach, Ms. Perez would receive only $1,500 because the search-for-work expenses would only be offset against the interim earnings. Id. at 5. However, under the new make-whole formula, Ms. Perez would be reimbursed for the full $6,000 of search-for-work expenses, regardless of how much she earned from her interim employment.

By providing full reimbursement of search-for-work and interim employment benefits, the Board assures that the wrongfully terminated employees are made whole.

Oct 12

Columbia University: Board Overrules Brown University and Classifies Student Assistants as Employees

By Divya Acharya.

Section 2(3) of the National Labor Relations Act (the “Act”) broadly defines an employee as “any employee,” subject to specified exceptions. Additionally, the Supreme Court has noted that the definition encompasses “any person who works for another in return for financial or other compensation.” Tasked with interpreting the wide-ranging breadth of this definition, the National Labor Relations Board (the “Board”) has rendered pendular decisions in cases such as New York University (2000), Brown University (2004), and, most recently, Columbia University (2016).

The Board issued a 3-1 decision in Columbia University, holding that student assistants working at private and nonprofit universities classify as employees pursuant to § 2(3) of the Act. In Columbia University, the Board revisited its earlier decisions in Brown University and New York University, which led to overturning the former and reinstating the latter.

In Columbia University, the majority reversed Brown University, which held that student assistants were primarily students and, therefore, had an educational, rather than an economic, relationship with the school. The Board found that it “deprived an entire category of workers of the protections of the Act without a convincing justification.” In Columbia University, we observe the Board embracing the rationale it applied in New York University, where it found that graduate assistants were employees pursuant to both § 2(3) of the Act and the common law agency doctrine.

Here, the Board did not find a compelling reason to exclude student assistants from the protections afforded by the Act. It is within the Board’s authority to treat student assistants as statutory employees when they are directed by the university to perform work for which they are compensated. In this case, the common law agency doctrine reflects a master-servant relationship between the student assistants and Columbia University: the university-employer has the right to control the student assistant-employee’s work, and the work is performed in exchange for compensation. Thus, since the standards for an employer-employee relationship are met under the common law test, it is sufficient to establish that the student assistant is a § 2(3) employee for all statutory purposes.

The Board reasoned that extending student assistants the right to engage in collective bargaining would not only preserve, but also advance the policies of the Act: to encourage collective bargaining and to protect a worker’s rights to freedom of association, self-organization, and designation of representatives of their own choosing.

It is important to note that when the New York University and Brown University decisions were rendered, the Board’s composition changed from that of a democratic majority to a republican majority. The Columbia University decision is the product of today’s democratic majority Board. Given that its changing members directly influence the Board’s decisions concerning this issue, it will be interesting to observe whether the looming presidential election will keep the pendulum swinging.

Sep 12

National Labor Relations Board Favors Fast-Food Unionizing Efforts in a 3-to-2 Ruling

At the end of the summer, the National Labor Relations Board (the “Board”) came down with a game-changing decision that affected fast-food chains and related companies dealing with contractors and franchisees. The decision heavily favored unions because it changed the meaning of an employer-employee relationship by including a staff contractor—a person hired to staff the parent company’s facilities—within the concept of a joint employer. Therefore, because a staff contractor is employed by the parent company, a union is legally entitled to bargain directly with the parent company, bypassing any bargaining relationship with the staff contractor at that specific facility. Previously, employees in this line of work rarely succeeded in union organizing, which, in some degree, was due primarily to their weak negotiating leverage against franchisees and staff contractors. Now, however, the Board significantly made union representation easier through an “indirect test” that establishes a greater number of bargaining relationships through an “ever-widening circle of employers.” For example, if fast-food employees at a particular restaurant choose to become unionized, this decision gives union representatives the opportunity to negotiate not just with the franchisee or contractor of that particular restaurant, but also with the corporate headquarters. For more information on this decision and how it may impact companies beyond fast-food restaurants, check out this article from The New York Times!