HR Management & Compliance

NLRB Issues Decisions on Electronic Notice, Compound Interest

Yesterday, the National Labor Relations Board (NLRB) released two decisions dealing with remedial policies. The first decision addressed compounding interest on back pay, and the second dealt with electronically notifying employees and union members about NLRB orders in unfair labor practice cases.

In Kentucky River Medical Center, 356 NLRB No. 8, the NLRB unanimously adopted a new policy under which interest on back pay must be daily compounded. Compound interest effectuates the remedial policies of the National Labor Relations Act (NLRA) better than simple interest, according to the Board. The NLRB also noted that compound interest is normally used in private lending practices and for monetary obligations imposed by federal law, including obligations under the Internal Revenue Code.

The NRLB explained that its primary focus is to make employees who suffered losses because of unfair labor practices whole. According to the Board, daily compounding of interest, rather than annual or quarterly compounding, would better achieve this goal.

In J. Picini Flooring, 356 NLRB No. 9, the NLRB decided that employers and unions involved in NLRB cases are now required to electronically distribute remedial notices when electronic distribution is “a customary means of communicating with employees or members.” (Employers and unions are also still required to physically post such notices.) When discussing its decision, the Board noted that electronic communications (such as e-mail and postings on internal and external websites) were overtaking (or have already overtaken) bulletin boards as the primary way of communicating with employees and union members.

Because of this decision, many employers and unions will have to:

  • electronically post remedial notices on their intranet or Internet site;
  • distribute them by e-mail; or
  • distribute them by another means of electronic communication if they customarily use such electronic mediums to communicate with employees or members.

This new process will improve the administration of the NLRA by making sure employees or members affected by unfair labor practices are aware of such remedial notices, according the NLRB.

Learn what else employers can expect from the new pro-labor NLRB, a beefed-up U.S. Department of Labor, and other federal watchdogs by participating in the all-new HR Hero virtual summit “HR Compliance Virtual Summit: Your All-Agencies Alert on New Enforcement Realities.”