Settling cases before the National Labor Relations Board (NLRB) became an increasingly difficult task under the prior administration, where the terms of agreements were often dictated by General Counsel directives insisting on specific remedies, types of remedies, or specific terms in agreements. For employers and labor attorneys seeking to resolve cases, pursuing a settlement was often a frustrating process, with too much time spent trying to work around these directives to facilitate an equitable settlement. Frequently, the directives meant cases did not settle until administrative law judges were assigned and hearings scheduled. These delays increased costs, heightened conflict, and did little to encourage labor peace. A new GC memo issued on Friday, May 16, 2025, will help change that.
William Cowen, Acting General Counsel for the NLRB, issued GC Memorandum GC-25-06 on Friday, May 16, reflecting a refreshing, common-sense approach to the resolution of cases before the agency. The new memo follows on the heels of a GC memo issued by Mr. Cowen on Valentine’s Day that rescinded a number of memos issued by Jennifer Abruzzo during her term as GC (see GC 25-05).
In the new memo, Cowen offers a practical approach to settlement agreements, highlighting efficiency and preservation of resources as goals in the processing of cases. Cowen states that “if we attempt to accomplish everything, we risk accomplishing nothing.” He notes that while the Regions retain discretion to tailor remedial relief to the circumstances of each case, the nonmonetary remedies discussed in the rescinded memoranda should not automatically be sought. Those remedies should be limited to cases involving widespread, egregious, or severe misconduct.
Settlements are the principal means by which unfair labor practices are remedied. As such, Cowen states that “diligent settlement efforts should be exerted in all…cases” to both effectuate the Act and “permit the Agency to concentrate its limited resources on other cases by avoiding costly litigation expenses.” Cowen offers a practical suggestion for those drafting settlements: “the scope of the remedial relief sought should typically be consistent with the remedy that would be ordered by the Board in a case involving similar facts and violations.” He notes that if the Region wants to require a novel remedy, clearance should be sought from the Division of Operations-Management and, where appropriate, the Division of Advice.
In this new memo, Cowen provides guidance on specific terms that have frustrated employers and practitioners alike as they have sought to settle cases:
In this new memo, Cowen provides guidance on specific terms that have frustrated employers and practitioners alike as they have sought to settle cases:
- Default Language: While noting that default language has been effective in ensuring compliance with the terms of an agreed-upon settlement, Cowen advises that default language is not required in every settlement agreement. He encourages the Regions to include default language in initial proposed settlement agreements, where appropriate, but notes that the inclusion of such language is at the discretion of the Regional Director, and Regions typically should not fail to achieve a settlement based solely on a party’s objection to such a provision.
- Non-Admissions Clauses: Cowen notes that non-admissions clauses may be included in settlement agreements, especially in the early stages of an investigation and immediately following a regional determination where a Region has yet to engage in substantial trial preparation. He notes that such clauses should typically be included in settlement agreements involving a recidivist violator and further that the NLRB will continue to prohibit the inclusion of a non-admissions clause in a Board remedial notice.
- Unilateral Settlements: Cowen provides additional discretion to Regional Directors, noting that they have the authority to approve unilateral settlement agreements that effectuate the Act without prior authorization.
- Make-Whole Relief: Cowen notes that while the Regional Directors should continue to pursue settlements that deliver full, effective relief to those whose rights have been violated, in appropriate cases Regional Directors have the discretion to approve settlement agreements that provide for less than 100 percent of the total amount that could be recovered if the Region fully prevailed in a case. He identifies the relevant factors to consider in such cases—the nature of the violations alleged, the weight of the evidence, the inherent risks of litigation, and the extent to which a prompt resolution of a dispute will promote labor peace. Regional Directors are cautioned to seek higher authorization prior to approving an agreement providing less than 80 percent of the reasonably anticipated relief.
Cowen closes the new memo by addressing Thryv, Inc., 372 NLRB No. 22 (Dec. 13, 2022), a case decided by the Board that expanded the scope of remedies available in addressing unfair labor practices. The majority in that case stated that they expected remedies to compensate affected employees for all direct or foreseeable pecuniary harms suffered as a result of the respondent’s unfair labor practice. The use of the term “foreseeable” interjected a tort term into remedial practices, creating some confusion as the term directly conflicts with the Board’s statement in Thryv, Inc. that it “does not award tort remedies.”
Cowen turns to the dissent in the case as he offers the guidance that foreseeable “harms” or “losses” should be remedied if they “result from” the unfair labor practices or where the “causal link” between the loss and the unfair labor practice is “sufficiently clear.” In other words, Cowen clarifies that for purposes of settlements, Region’s should focus on addressing foreseeable harms that are clearly caused by the unfair labor practice.
The guidance provided in GC 25-06 is refreshing and should help open the door for more efficiency in crafting settlements of unfair labor practices.
[View source.]
