Most people don’t realize that one of the remedies the NLRB can order is for a company to relocate and/or reopen.
Some companies faced with a union organizing drive relocate to avoid that drive. This is called a “runaway shop.”
Runaway shops risk being ordered to relocate back to their original location and offer to rehire the employees who lost their jobs. This gets expensive and complicated quickly.
Sometimes companies just close in response to union organizing. The law is a little trickier here. But, one of the remedies is to force the company to reopen and offer to rehire former employees (with backpay). The current NLRB will also order compensatory damages.
In 2018 a concrete company closed its truck repair operation and terminated two employees who tried to organize a union.
In 2020, the NLRB ordered the company to reopen its truck repair operation and rehire (with backpay) the two employees it terminated.
In 2021, the D.C. Circuit Court of Appeals remanded the case to the NLRB to determine if reopening a business that had been closed for 3 years was *really* warranted.
At end of 2022, the Biden NLRB held: “We find it inappropriate to order [the company] to reopen [when] there is no existing lease, where [the company’s] remaining facilities cannot adequately or lawfully house [the company], and where [the company] has not functioned as a business in over four years.”
This coming from the Biden NLRB may surprise you.
Not when you learn that the Biden NLRB’s 3-Member panel consisted of 2 Republican Members and 1 Democrat Member.
Member Pouty (D), of course, dissented to the ruling and would have required the company to reopen and rehire the workers.
The NLRB is now 3 Democrats and 1 Republican. And it will stay like this for at least the next 6 months.
Had the D.C. Circuit waited until today to remand the case, the company would have likely been ordered to reopen and rehire (with backpay) a company that had been closed for 4 years.
Matt Austin is a nationwide management labor lawyer. Labor laws govern virtually all private-sector employees regardless of union membership. Proactive management of labor relations is critical to maintaining flexibility and increasing profit.
Matt also runs Austin Legal’s HR Legal Compliance Program that, for a small monthly fee, ensures HR decisions are protected by the attorney-client privilege.
Matt’s experience is deeply rooted in helping manage many aspects of his clients’ businesses. To effectively manage labor relations, he must also manage budgets, forecasts, new growth areas, and projected market corrections. High emotional intelligence is also critical to negotiating union contracts and to properly advise HR Legal Compliance members through the nuances of the law, its application to their companies, and how it will be received by employees.
You can reach Matt via email at Matt@MattAustinLaborLaw.com.