NLRB Dismisses Discriminatory Discharge Charges Because Discharged Employees Signed Releases of Claims in Severance Agreements.

Last Fall, the NLRB issued a surprising decision dismissing the Unfair Labor Practice Charges filed on behalf of 37 employees who purportedly had been laid off on account of their union activities because they had signed releases of claims in their severance agreements before any ULP Charge had been filed or even contemplated. BP Amoco Chemical–Chocolate Bayou, 351 NLRB No. 39 (Sept. 29, 2007). In doing so, the Board applied the same four-factor standard it applies to releases negotiated by the Board’s General Counsel following the filing of ULP Charges:

(1) “Whether the parties to the Board case have agreed to be bound, and the position taken by the General Counsel regarding settlement.” “Tere is no dispute that the alleged discriminatees voluntarily agreed to be bound [to the severance agreements]. Not only did each of them sign the agreement, but, as the parties stipulated, they were aware of the content, advised of the meaning [by their individual attorneys and/or the union], and knew that they were waiving and releasing claims against the Respondent.

(2) “Whether the settlement is reasonable in light of the violations alleged, the risks inherent in litigation, and the stage of litigation.” “At the time the agreements were signed, no charges had been filed, and the prospect of litigation was not obvious. Moreover, there was significant risk that a charge alleging discriminatory selection would not be meritorious. Little or no union activity was occurring at the time of the downsizing, and the record does not show that all of the alleged discriminatees had engaged in protected activity or that the Respondent was aware of it. . . . Indeed, the General Counsel acknowledged weaknesses in the case, conceding that “[w]e do not have a smoking gun” and that many of the alleged discriminatees had work histories which were “less than pristine.”

(3) “Whether there has been any fraud, coercion, or duress by any party in reaching the settlement.” “Respondent encouraged the alleged discriminatees to consult attorneys, provided them sufficient time [of 45 days] to carefully review and assess the agreements, and provided them with the opportunity to revoke the agreements within a reasonable period after execution.”

And (4) “Whether the respondent has a history of violating the Act or has previously breached settlement agreements.”

Insomniacs may read the full decision at: http://www.nlrb.gov/research/decisions/board_decisions/template_html.aspx?file=http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35139.htm&size=294.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with an attorney.