By Brendan O'Brien
Jan 11 (Reuters) - The National Labor Relations Board said
it will begin including front pay in settlement agreements
rather than in side letters, effective immediately.
Acting NLRB general counsel Lafe Solomon announced the
policy change to front pay -- compensation in lieu of
reinstatement -- in a memo dated Jan. 9.
"It remains agency policy that reinstatement is generally
the best means to remedy the harm to employee statutory rights
caused by an unlawful discharge or layoff," he wrote. "However,
it is ultimately the discriminatee who chooses whether to insist
on reinstatement, or waive it in return for compensation,"
Because front pay has been typically written into a side
letter between parties, the board has not had the power to
Solomon also announced that the board now requires that
waivers of reinstatement be in writing, except in special cases.
The modifications to board policy are based on a
recommendation made by the NLRB quality committee, which
regularly reviews board policies.
Settlements that result in front pay rather than
reinstatement have tended to increase over time, based on a
reading of NLRB data that shows a growing percentage of
reinstatement offers being declined.
For example, the NLRB sought reinstatement offers in 1,644
cases where workers were illegally fired in 2011, but only 910
were accepted, or 55 percent. By comparison, 2,426 of 2,929
offers in 2006, or 83 percent, were accepted.
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