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3-2 NLRB reinstates ‘reasonableness’ settlement standard; agrees hospital not single employer with subsidiary

By Lisa Milam-Perez, J.D.

In a 3-2 decision, the NLRB ruled that an ALJ properly dismissed claims against UPMC alleging it was a single employer with its subsidiary based on its offer to guarantee the subsidiary’s performance of any remedial aspects of a Board order that survives the exceptions and appeal process. The holding was the first five-member decision to emerge since installation of President Trump’s two Board appointees, and comes on the eve of Chairman Philip Miscimarra’s imminent departure. Here, the divided Board overruled a 3-1 decision from 2016, likely the first of several reversals of Obama-era case law to come prior to Miscimarra’s exit later this week (UPMC and its subsidiary, UPMC Presbyterian Shadyside, single employer, dba UPMC Presbyterian Hospital and dba UPMC Shadyside Hospital, December 11, 2017).

The Board overruled United States Postal Service, a 2016 decision in which a divided Board rejected the prior practice of permitting judges to accept a respondent’s proposed settlement terms, over the objection of the General Counsel and charging party, if the proposed settlement terms were deemed reasonable based on factors set forth in Independent Stave, 287 NLRB 740 (1987) (Independent Stave). In Postal Service, the Board held that proposed settlement terms could be accepted in these circumstances only if they provided a full remedy for all violations alleged in the complaint.

“By overruling Postal Service, the Board also reinstates the authority of judges to accept settlements over the objection of the General Counsel and charging parties, based on Independent Stave reasonableness factors, subject to Board review (applying the Independent Stave factors) if the General Counsel or charging party files exceptions with the Board,” the Board noted in a press statement announcing the decision.

Chairman Philip A. Miscimarra was joined by Members Marvin E. Kaplan and William J. Emanuel in the majority opinion. Members Mark Gaston Pearce and Lauren McFerran dissented.