Key NLRB Changes Under the New Administration: What Employers Need to Know

Last month, during our webinar, we predicted significant regulatory shifts under the new presidential administration. Now, just a little over 30 days in, we are witnessing these changes unfold – especially at the National Labor Relations Board (NLRB). This article will break down some key developments, what they mean for employers, and what to expect moving forward.

A Shift in Power and Deregulation at the NLRB

The President has wasted no time in advancing his regulatory agenda, focusing on reducing federal oversight and reshaping or even eliminating key agencies. Two seismic shifts have occurred at the NLRB:

1. Change in Prosecutorial Direction

In late January, The President officially removed former General Counsel (GC) Jennifer Abruzzo, which was unsurprising. With Abruzzo’s removal, her former deputy, Jessica Rutter, stepped in as Acting GC. She too was removed shortly thereafter. On February 3, the President appointed William Cowen as Acting General Counsel. A seasoned NLRB veteran, Cowen has held various roles in the NLRB including Regional Director for the Los Angeles Regional Office, Solicitor, and Board Member appointed by President George W. Bush.

As expected, within days of assuming office, Cowen issued GC Memo 25-05, Rescission of Certain General Counsel Memoranda, which rescinds several labor-friendly initiatives introduced by former GC Abruzzo. He even reached farther back to rescind more GC memoranda than predicted by many practitioners. In doing so, Cowen sent a strong message signaling an intention to narrow the scope and application of the NLRA, which is a stark contrast to Abruzzo’s expansive, overbroad read of the Act. He aptly noted that the Board has seen its “backlog of cases grow to the point where it is no longer sustainable.” Thus, he concluded “the unfortunate truth is that if we attempt to accomplish everything, we risk accomplishing nothing.”

Among others, Cowen rescinded the notable GC memoranda concerning the following:

• Vigorous Enforcement of the Mutual Aid or Protection and Inherently Concerted Doctrines: GC Memo 21-03, which announced an initiative to broadly interpret the mutual aid or protection and inherently concerted doctrines.
• Employee Monitoring: GC Memo 23-02, which recommended that the Board find an employer’s practices to monitor employees violated the Act unless the employer can demonstrate that the practices are narrowly tailored to address a legitimate business need.
• Expanded Remedies: GC Memos 21-06, 21-07 and 24-04 instructed Regions to seek “the full panoply of remedies available to ensure that victims of unlawful conduct are made whole for losses suffered as a result of unfair labor practices” including front pay in some instances.
• Section 10(j) Injunctive Relief: Memo 24-05, directed all Regional Offices to continue “aggressively” seek injunctive relief under Section 10(j) of the Act.
• Confidentiality and Non-Disparagement Provisions: GC Memo 23-05 provided guidance to Regions in light of McLaren Macomb, where the Board found unlawful severance agreements with broad confidentiality and non-disparagement clauses.
• Non-Compete and “Stay or Pay” Restrictions – GC Memo 25-01 announcing intention to prosecute employers to maintain such provisions in employee agreements, workplace rules, or handbooks on the basis that they interfere with employees rights under Section 7 of the Act.
• College Athletes and Organizing in Higher Education: GC Memos 24-06 and 21-08 recommending that the Board take an expansionary approach in finding that both student-athletes and student-workers at institutions of higher education to be employees under the NLRA.

2. Board Composition Shake-Up

The five-member NLRB is currently in limbo, lacking a quorum after the President removed Board Member Gwynne Wilcox in an unprecedented show of Executive force. Wilcox was removed despite her Senate-confirmed term extending to 2028. Wilcox has since filed a lawsuit challenging her removal.

Legal Battle Over Wilcox’s Removal

Wilcox’s lawsuit, filed in U.S. District Court for the District of Columbia, argues that her dismissal violates the Act. She cites Humphrey’s Executor v. United States, where the Supreme Court ruled that the President cannot remove independent agency members without cause. The case, assigned to Judge Beryl Howell, has a briefing schedule set, with responses due from the administration by February 21.

3. What This Means for Employers

The administration appears to be testing the scope of Executive power and the unitary executive theory, asserting that the President has ultimate authority over agency leadership—even in independent agencies like the NLRB.

With no quorum, the Board cannot adjudicate labor disputes, delaying decisions on pending cases. However, NLRB Regional Offices remain active, continuing to investigate and prosecute unfair labor practice cases, conduct union representation elections, and process representation petitions. Administrative Law Judges will still hear cases before appeals can be made to the Board.

What Can Employers Do Now?

1. Stay Compliant with Existing Board Law – Despite shifting prosecutorial priorities, current labor laws remain in effect.
2. Monitor Legal Developments – The outcome of Wilcox’s lawsuit could redefine Board authority and Presidential executive power across the federal government.
3. Be Prepared for a Stormy Forecast in Labor Relations
   • Potentially increased social justice activism by employees, especially on the subjects of diversity, equity, and inclusion as well as gender identity.
   • Potentially increased employee reliance on social media to publicize, resist, or protest employer practices.
   • Potentially increased union activity in the form of unfair labor practice charges and petitions.
   • More strategic union tactics to pressure lawmakers at the state level directly and use social media to publicly shame employers and elected officials.
   • Potentially increased strikes and labor unrest, especially in the face of layoff and greater economic uncertainty.

Conclusion

The NLRB stands at a critical crossroads, with the Wilcox lawsuit poised to shape its governance for years to come. Meanwhile, the new Acting GC is swiftly rolling back prior labor-friendly policies, signaling a pro-business shift to a narrow application of federal labor law. Employers must remain vigilant, comply with existing laws, and seek legal guidance to navigate this rapidly changing landscape.

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