Early this week, the Trump Administration removed General Counsel (GC) Jennifer Abruzzo and Board Member Gwynne Wilcox (a Democrat) from their positions at the National Labor Relations Board (NLRB). While Member Wilcox’s removal is likely to face legal challenge, in the interim it leaves the Board without a quorum, preventing it from deciding cases. As far as the GC position is concerned, Deputy GC Jessica Rutter has stepped in as Acting GC. These removals mark the initial step in the Trump Administration’s efforts to reshape national labor policy.
GC Abruzzo (a President Biden appointee) released several high-profile memoranda that impacted key labor issues during her tenure as GC. These memoranda (available here) outlined enforcement priorities and interpretations of Board decisions to guide the litigation work of the General Counsel’s office. A Trump-appointed GC will look to withdraw and/or replace nearly all of these memoranda and set new enforcement priorities. Some of the most consequential memoranda that might come into the new GC’s crosshairs include:
- Electronic Monitoring of Employees (Memo GC 23-02). This memo advocated for stronger enforcement to protect employees from intrusive electronic monitoring (including cameras, GPS wearables, and AI systems) that Abruzzo contended interferes with their Section 7 rights. The memo proposed requiring employers to demonstrate that their practices are narrowly tailored to legitimate business needs, balancing those needs against employees’ rights. Finally, the memo proposed requiring employers to disclose their surveillance practices (monitoring methods, reasons for monitoring, and uses for the information) to employees.
- “Stay-or-Pay” Provisions (Memos GC 23-08 and GC 25-01). These two memoranda targeted non-compete and “stay-or-pay” provisions that Abruzzo contended violate employees’ Section 7 rights. The latter memo proposed that only voluntary stay-or-pay provisions, designed to recoup costs for optional benefits, should be permissible. It also recommended that contractual provisions requiring payment if an employee leaves within a certain timeframe should be presumed unlawful. Regarding remedies, the memo suggested that, when unlawful provisions are found, employers should provide make-whole relief to employees, including compensation for any financial harm (g., moving costs if an employee had to relocate for work).
- Non-Disparagement and Confidentiality Clauses in Severance Agreements (Memo GC 23-05). This memo confirmed that the Board’s McLaren Macomb decision applies retroactively and advised employers to consider notifying former employees about the invalidity of these clauses to avoid further violations. The memo also asserted that confidentiality clauses are only lawful if narrowly tailored, and non-disparagement clauses are lawful only if they are limited to defamatory statements. In terms of enforcement, it emphasized that offending provisions can be removed even without severability clauses and employers cannot save overbroad clauses with disclaimers.
- Expanded Scope of Remedies (Memos GC 21-06 and GC 24-04). These memoranda instructed regional offices to seek more comprehensive remedies, including consequential damages, for workers impacted by unfair labor practices. The memos also encouraged seeking Gissel bargaining orders in cases with ongoing union organizing. Broad cease-and-desist orders, public notice readings, and training on employee rights were among the other remedies discussed. The latter memo encouraged regional offices to focus particularly on seeking settlements in 8(a)(1) cases that provide make-whole remedies and working to gather the necessary information for those remedies during settlement talks.
- Section 10(j) Injunctions (Memo GC 24-05). This memo directed field offices to continue aggressively pursuing Section 10(j) injunctions despite the Supreme Court decision in Starbucks Corp. v. McKinney, which rejected a more lenient test for awarding those injunctions.
Closely following the recent appointment of Member Kaplan to Chairman of the Board, the removal of GC Abruzzo and Member Wilcox are the second major step in the Trump Administration’s labor agenda. More developments, including President Trump’s nominations for GC and the vacant board seats and legal challenges to Member Wilcox’s removal, will likely follow in the coming weeks and months. In the meantime, the above memoranda provide some indication of areas labor professionals may expect to see enforcement changes in the near future. Stay tuned for further updates on the Trump Administration’s efforts to implement its vision for national labor policy.
By: Matt Schmitz, Becca Hill and Michael Shoenfelt