NLRB Changes Its Approach to Allow for Electronic Unfair Labor Practice Notices and Daily Compound Interest on Backpay Awards
November 3, 2010
Under the National Labor Relations Act, the National Labor Relations Board can require employers to post notices regarding their violations of the Act, remedies ordered by the Board, and the rights employees enjoy under the Act. Traditionally, these notices have been prepared in paper format and posted on bulletin boards or similar areas where employees will likely see them. In a recent case, J. Picicini Flooring, the Board changed its approach and will now require employers who customarily communicate with employees by electronic means to provide electronic notices to those employees. For most employers, this will mean distributing notices through e-mail or posting them on an internet or intranet website, but the posting obligation could encompass other forms of electronic communication depending upon how the employer communicates with employees. Employers should understand that electronic notice posting does not replace the traditional paper notice—it simply adds an additional layer of notice for employers that primarily use electronic communication.
In another recent case, Kentucky River Medical Center, the Board announced that it would now use daily compound interest when computing backpay awards owed to employees. For almost 50 years, the Board added simple interest to backpay awards, and it has used several different computation methods to account for the then-current financial norms. Currently, private lenders use compound interest and it has become the norm under other federal laws like the Internal Revenue Code. For this reason—and because, according to the Board, the use of daily compound interest more closely returns employees to their financial position before the unfair labor practice occurred and better serves the remedial policies of the Act—the Board will now require daily compound interest on backpay awards.
With a full complement of members and an established pro-labor leaning, employers should expect more changes like these from the Board in the future.