NLRB to Pursue New Uncapped Search-for-work and Work-related Expenses Damages Beyond Traditional Backpay Remedies in Unlawful Discharge Cases | Practical Law

NLRB to Pursue New Uncapped Search-for-work and Work-related Expenses Damages Beyond Traditional Backpay Remedies in Unlawful Discharge Cases | Practical Law

The Office of the General Counsel of the National Labor Relations Board (NLRB) released a General Counsel Memorandum directing NLRB regions, which are responsible for pleading unfair labor practice (ULP) complaints and subsequently undertaking compliance proceedings after successful ULP prosecutions, to consider damages for search-for-work and work-related expenses independently from interim pay and backpay.

NLRB to Pursue New Uncapped Search-for-work and Work-related Expenses Damages Beyond Traditional Backpay Remedies in Unlawful Discharge Cases

by Practical Law Labor & Employment
Published on 10 Feb 2015 • USA (National/Federal)
The Office of the General Counsel of the National Labor Relations Board (NLRB) released a General Counsel Memorandum directing NLRB regions, which are responsible for pleading unfair labor practice (ULP) complaints and subsequently undertaking compliance proceedings after successful ULP prosecutions, to consider damages for search-for-work and work-related expenses independently from interim pay and backpay.
As part of the NLRB's make-whole remedies for persons held to have been discharged in violation of the NLRA, the NLRB traditionally:
  • Awards search-for-work and work-related expenses, such as:
    • increased transportation costs in seeking or commuting to interim employment;
    • the cost of tools or uniforms required by an interim employer;
    • room and board when seeking employment and/or working away from home;
    • contractually required union dues and/or initiation fees, if not previously required while working for respondent; and
    • the cost of moving if required to assume interim employment.
  • Considers the search-for-work and work-related expenses an offset to interim earnings and caps them at the amount of interim earnings. (Any remaining interim earnings are then used to offset backpay awards).
In a General Counsel Memorandum dated January 30, 2015, the NLRB General Counsel directed NLRB regions, which are responsible for pleading unfair labor practice (ULP) complaints and subsequently undertaking compliance proceedings from successful ULP prosecutions, to consider damages for search-for-work and work-related expenses independently from interim pay and backpay in cases where backpay is likely to be owed (Clarification of GC 11-08, Gen. Counsel Mem. 15-01, (N.L.R.B.G.C. Jan. 30, 2015)). In particular, for those cases, the General Counsel instructed NLRB regional offices to:
  • Affirmatively allege in their initial ULP complaints involving unlawful discharges that the General Counsel seeks search-for-work and work-related expenses regardless of whether they exceed interim earnings.
  • Argue that the panel (Board) heading the NLRB's judicial functions should overrule precedent that holds these expenses are payable only to the extent they do not exceed interim earnings.
The General Counsel provided draft brief language for these ULP cases that among other things asserts that:
  • The current Board precedent on search-for-work and work-related expenses effectively punishes unlawfully discharged employees, who meet their statutory obligations to seek interim work, but who, through no fault of their own:
    • are unable to secure employment; or
    • secure employment at a lower rate than interim expenses.
  • The current Board precedent on search-for-work and work-related expenses runs counter to the approach taken by the EEOC and the US DOL.
  • Search-for-work and work-related expenses should be:
    • uncapped and calculated separately from taxable net backpay; and
    • paid separately, in the payroll period when incurred, with daily compounded interest charged on these amounts.
This General Counsel memorandum was intended to clarify backpay award instructions from a General Counsel memorandum from 2011 (see Changes to the Methods Used to Calculate Backpay in Light of Kentucky River Med. Ctr. & to Better Effectuate the Remedial Purposes of the Act, Gen. Counsel Mem. 11-08, (N.L.R.B.G.C. Mar. 11, 2011)).