Two Board cases decided September 7 shed light on how the Board handles alleged breaches of informal settlement agreements and the “default language”[i] that Regions often put in those settlement agreements — ConAgra Foods and Outokumpu Stainless. In particular, Miscimarra’s separate opinions in these cases signal that the Trump Board may hold the Regions more closely to the precise terms of the settlement agreements, and hopefully push back on Regions who have made it difficult for employers to reach informal settlements in recent years.
In ConAgra Foods, Inc., 365 NLRB No. 102 (Sept. 7, 2017), the Board denied the General Counsel’s motion for default judgment where the GC failed to notify the employer that the alleged misconduct also allegedly violated a prior settlement agreement. Miscimarra concurred, further denying the motion for default judgment because the GC also failed to give the employer 14 days’ notice and an opportunity to cure the noncompliance.
In Outokumpu Stainless USA, LLC, 365 NLRB No. 127 (Sept. 7, 2017), the Board found a violation of the settlement agreement and granted the GC’s motion for default judgment against the employer on a host of previously-settled unfair labor practice allegations. The Board found the employer violated the settlement agreement by posting a letter next to the Board’s remedial notice that criticized the union for filing the charges and emphasized that the Board did not find the employer guilty of the alleged violations.
Miscimarra dissented in part, writing that the letter did not breach the express terms of the settlement agreement because the agreement did not prohibit the side letter. Therefore, Miscimarra would set aside the settlement agreement because the letter detracted from the remedial purpose of the notice but would not invoke the settlement agreement’s default judgment provision. That is, Miscimarra would have permitted the employer to defend against the underlying allegations before finding the employer to have violated the Act.
[i] In informal settlement agreements, Regions include “default language” as a matter of course, absent hard-fought negotiations that often include ALJ intervention. The default language provides that if the employer breaches the settlement agreement, the GC may reopen the settled case and move for default judgment. The employer loses the right to litigate the underlying issues in the settled case and can litigate only whether it breached the settlement agreement. Such language presents significant concerns for employers by making it difficult to settle a case with finality. This is particularly so for multi-facility employers who may unknowingly violate a settlement agreement by committing a similar but unrelated unfair labor practice in a different facility.