Management Memo

National Labor Relations Board (“Board”) General Counsel Jennifer Abruzzo (“Abruzzo”) issued a General Counsel Memo (Memo GC 25-01) last week signaling that employers could face civil prosecution and significant monetary remedies for using non-compete and so-called “stay-or-pay” provisions in agreements with their employees.The new memo, issued on October 7, 2024, builds on Abruzzo’s earlier General Counsel Memo issued in May 2023, where, as we reported, she outlined her belief that nearly all post-employment non-competes violate employees’ rights under the National Labor Relations Act (the “Act”).

Since Abruzzo’s May 2023 memo, employers have witnessed a number of significant developments in this space, including the Federal Trade Commission’s (“FTC”) issuance of a rule in April 2024 banning the use of most non-competes and a subsequent decision by a Texas federal judge blocking that FTC rule. In June 2024, an NLRB Administrative Law Judge issued a ruling in a case involving an Indiana HVAC company finding that non-competes and non-solicitation clauses violate the Act, a decision currently being appealed to the Board.

In her October 7, 2024 memo, Abruzzo again urges the Board to find non-competes with all employees who are subject to the Act’s jurisdiction (nonmanagerial and nonsupervisory employees) to violate the Act except in a few limited circumstances, arguing that such provisions are frequently “self-enforcing” and deter employee mobility. She also advocates for “make whole” remedies where employers are found to have continued to maintain unlawful non-competes. Specifically, the memo argues that merely voiding such provisions is insufficient and that employees should be afforded the right to seek compensatory relief for the “ill effects” that flow from complying with “unlawful non-compete provisions.”

On September 6, 2023, Governor Kathy Hochul signed into law Senate Bill 4982 and Assembly Bill 6604, which amends Section 201-D of the New York Labor Law to prohibit most employers from requiring non-managerial and non-supervisory employees to attend employer-sponsored meetings where the primary purpose is to communicate the employer’s opinions on religious or political matters. The amendment took immediate effect and makes New York the latest state to ban so-called “captive audience meetings,” following the National Labor Relations Board (NLRB) General Counsel’s ...

The National Labor Relations Board (NLRB) has found its first target under recent guidance issued in a memo from its General Counsel claiming that noncompete agreements may violate the National Labor Relations Act (NLRA). According to Bloomberg Law, “[t]he NLRB’s first enforcement action against an employer’s noncompete agreement targeted a Michigan cannabis processor and ended with a recent private settlement resolving the alleged labor law violations.” (The enforcement action predates the guidance memo). Bloomberg obtained redacted documents from the case via a Freedom of Information Act request.

The National Labor Relations Board’s top lawyer, Jennifer Abruzzo, issued  a General Counsel memo today instructing the Labor Board’s Regional Directors of her position  that noncompete clauses for employees protected by the National Labor Relations Act (NLRA) (i.e., nonmanagerial and nonsupervisory employees) in employment contracts and severance agreements violate federal labor law except in limited circumstances. The memo, while not law, outlines her legal theory which she will present to the National Labor Relations Board, which makes law primarily through adjudication of unfair labor practice cases.  The memo instructs the agency’s field offices of the position that the General Counsel is instructing them to take when investigating unfair labor practice charges claiming that such clauses interfere with employees’ rights under the NLRA.

In an Advice Memorandum dated April 20, 2022 and released on November 30, 2022, the Division of Advice within the National Labor Relations Board’s (“NLRB” or “Board”) Office of the General Counsel urged the Board to overturn existing Board law to significantly lower the standard for when an employer must furnish the union with its general financial information. This latest push to bolster unions during bargaining follows the NLRB’s General Counsel Jennifer Abruzzo’s (“GC”) issuance of Memorandum GC 21-04 regarding Mandatory Submissions to Advice on August 12, 2021, wherein she signaled her intent to change this standard.

On October 31, 2022, the General Counsel of the National Labor Relations Board (“NLRB” or “Board”) released Memorandum GC 23-02 urging the Board to interpret existing Board law to adopt a new legal framework to find electronic monitoring and automated or algorithmic management practices illegal if such monitoring or management practices interfere with protected activities under Section 7 of the National Labor Relations Act (“Act”).  The Board’s General Counsel stated in the Memorandum that “[c]lose, constant surveillance and management through electronic means threaten employees’ basic ability to exercise their rights,” and urged the Board to find that an employer violates the Act where the employer’s electronic monitoring and management practices, when viewed as a whole, would tend to “interfere with or prevent a reasonable employee from engaging in activity protected by the Act.”  Given that position, it appears that the General Counsel believes that nearly all electronic monitoring and automated or algorithmic management practices violate the Act.

On April 7, 2022, Jennifer Abruzzo, General Counsel of the National Labor Relations Board (“NLRB” or “Board”), issued Memorandum GC 22-04, titled “The Right to Refrain from Captive Audience and other Mandatory Meetings” (“GC Memo”). It is no secret that the General Counsel has been an advocate for policies and practices that would increase union representation and make it easier for unions to gain recognition and win votes on representation. This includes restricting steps employers can take to share their views with employees. Such a step that the GC Memo calls for is a series of restrictions on what have been called “captive audience speeches,” that is, meetings on company time where employers present their views.

On August 12, 2021, Jennifer A. Abruzzo issued her first memorandum as newly sworn National Labor Relations Board (“NLRB” or “Board”) General Counsel. The memo, Mandatory Submissions to Advice, Memorandum GC 21-04 (“GC Memo 21-04”), serves as a road map of the new General Counsel’s plans and her intent to depart from the priorities of her predecessor, Peter Robb, and to target cases and initiatives from the Trump Board that overruled the precedent from the Obama Board. As we have previously reported, President Biden, on the day of his inauguration, took the ...

On July 21, 2021, the U.S. Senate confirmed Jennifer Abruzzo to a four-year term as the General Counsel of the National Labor Relations Board (“NLRB” or “Board”). Ms. Abruzzo’s confirmation was by a vote of 51-50, with Vice President Kamala Harris casting the tie-breaking vote. Ms. Abruzzo was sworn in the next day, by NLRB Chair Lauren McFerran. As the NLRB notes, this is “the first time in NLRB history women are serving as both Chairman and General Counsel” of the agency.

Ms. Abruzzo has spent much of her career at the NLRB. She previously served as the Board’s Deputy ...

In the months following Donald Trump’s inauguration, those interested in the National Labor Relations Board (“NLRB” or “Board”) waited anxiously for the new President to fill key positions that would allow the Board to reconsider many of the actions of the past eight years. Over the last six months, the Board has begun to revisit, and overrule, several union-friendly and pro-employee Obama-era Board decisions. The Board’s new General Counsel has also given clear guidance as to where else employers can expect to see his office pursue further changes in how the National ...

When: Tuesday, October 18, 2016 8:00 a.m. – 4:00 p.m.

Where: New York Hilton Midtown, 1335 Avenue of the Americas, New York, NY 10019

Epstein Becker Green’s Annual Workforce Management Briefing will focus on the latest developments in labor and employment law, including:

• Latest Developments from the NLRB
• Attracting and Retaining a Diverse Workforce
• ADA Website Compliance
• Trade Secrets and Non-Competes
• Managing and Administering Leave Policies
• New Overtime Rules
• Workplace Violence and Active-Shooter Situations
• Recordings in the Workplace
• Instilling Corporate Ethics

Last week we reported on the fact that Teamsters Local 853 and Loop Transportation had completed negotiations for a first collective bargaining agreement covering a unit of shuttle bus drivers who provide transport for employees of Facebook.  We pointed out that employers in technology, media and telecommunications were facing union organizing targeting employees of their vendors and suppliers for transportation, maintenance, food service and the like, that threatened to enmesh such employers as a consequence of unions gaining recognition of their vendors’ and ...

Earlier this week the Senate confirmed Richard Griffin as NLRB General Counsel.  As we have noted previously in greater detail, Griffin’s appointment was controversial, having been unconstitutionally appointed as a Board Member and, to the ire of Republicans, seemingly thumbed his nose and multiple Courts of Appeals which ruled he and the other recess appointments did not have the authority to act.

In an anti-climactic end to several years of NLRB appointment Senate wrangling, Griffin was confirmed Tuesday in a party line vote.  He now becomes the first confirmed ...

By Adam C. Abrahms, Steven M. Swirsky, and D. Martin Stanberry

On Tuesday, August 20th, in an opinion that follows in the wake of Noel Canning, United States District Judge Benjamin H. Settle dismissed an injunction petition filed by Ronald Hooks, a Regional Director  of the National Labor Relations Board, on the grounds that he was “without power” to issue the underlying unfair labor practice complaint.

The Regional Director had initially filed the petition with the District Court in June in an effort to obtain a temporary injunction that would, among other things, have ...

On August 1st President Obama made a bold statement by appointing Richard Griffin to serve as the NLRB's General Counsel only three days after the former union lawyer vacated his unconstitutional recess appointment as a NLRB Board Member. The President statement by appointment made at least two things clear -

1. The President wants an aggressive pro-labor General Counsel and NLRB, and
2. The President values advancing the labor agenda over cooperation with the US Senate.

As we discussed here on July 30th the Senate confirmed a full Board for the first time in a decade as a result of a "deal" in ...