The six people who read my original post on the illusion of the make-whole remedy (thanks mom!) know my strong feelings about weak and unjust remedies in labor law – particularly the failure of remedies to truly make employees whole after they have been wrongfully discharged or suspended by an employer. Indeed, the costs of losing one’s job – even temporarily – stretch well beyond the loss of a paycheck. Too often, those tasked with enforcing collective bargaining agreements or labor laws do not acknowledge or seek to correct this injustice even when they determine that an employer has acted egregiously.
To its credit, NLRB remedies often go beyond the typical “reinstatement and full back pay” that arbitrators frequently confine their remedies to, even in the most egregious of situations. However, given the Board’s obligation to make employees whole and to discourage employers from future misconduct, its remedies leave a lot to be desired.
So, no doubt my ears perked up upon reading the following recent pronouncement from the NLRB in its King Soopers decision:
Today, we assess whether the current remedial framework properly awards make-whole relief, or fails to truly make whole the aggrieved victims of unlawful conduct.
And I may have done a tiny fist-pump upon reading:
[I]t is vitally important that the Board ensure that the make-whole remedy fully compensates unlawfully discharged employees for the losses they incurred and “deter[s] further encroachments on the labor laws.”
While recognizing that this decision addresses a very distinct aspect of Board remedies – reimbursement for job-search and interim job expenses – any movement towards a more complete remedial approach is a win.
King Soopers involved a supermarket employee who worked as a barista in the store’s Starbucks kiosk. The Board held that the supermarket illegally suspended and fired her, essentially for questioning whether a supervisor could order her to bag groceries. While the decision itself is short on details about the employee’s efforts to find interim employment while she was out of work, the bulk of the decision addresses whether the employer must reimburse her for the costs associated with those efforts.
Reversing 80 Years of an Unfair Remedial Policy
Terminated employees have an obligation to look for work to mitigate any lost pay while they await the outcome of their Board charge. Consequently, employees incur significant expenses such as travel costs to attend interviews or jobs that are further away from their homes. For the past 80 years, the Board “reimbursed” employees for such expenditures by subtracting those costs from their interim earnings. For instance, if the employee earned $1,000, with $200 in expenses, her interim earnings would total $800, and (assuming the Board found a violation) the employer would have to pay the difference between $800 and what the employee would have earned had she not been fired.
This may seem fair at first glance, but what happens when the expenses are more than the interim earnings? Or, worse, when the employee is unable to find interim employment?
In a nutshell, King Soopers changes the NLRB’s remedial approach by treating job-search and interim job expenses as a separate injury that employers must fully compensate employees for – with interest. Thus, the employee who has to photocopy and mail resumes, pay a babysitter while she’s out interviewing or working a late shift at a temporary job, or drive long distances or take a bus to those interviews or jobs can now hope to be fully reimbursed even if she does not find a job or finds one that does not cover those expenses.
As icing on the cake, the Board held that it will apply its new remedial policy to any currently pending cases. The decision’s impact in other forums, however, is less certain. The NLRB’s remedial policies, for instance, typically do not bind arbitrators who are tasked with deciding whether employers must reinstate a discharged employee under a collective bargaining agreement. Such policies, however, may inform arbitration awards or at least empower union representatives to advocate for additional remedies – such as job search costs – as part of their efforts to make wrongfully terminated employees truly whole.
One can dream.