In a 3-1 decision, the National Labor Relations Board (“NLRB” or “Board”) ended the agency’s practice of approving “consent orders,” which permitted an administrative law judge to resolve an unfair labor practice case before adjudication based on terms offered solely by the respondent.  The Board’s decision will make it more difficult for employers to settle cases at the NLRB unless they are willing to accept the full remedy sought by the general counsel. 

In Metro Health, Inc. d/b/a Hospital Metropolitano Rio Piedras, 373 NLRB No. 89, decided on August 22, 2024, the Board likened the practice of approving consent orders to a unilateral resolution between an administrative law judge and respondent, concluding for the first time in more than fifty years that the Board’s Rules and Regulations do not permit judges to “adjust cases” in this manner.  The Board also reasoned that allowing judges to approve consent orders intrudes on the General Counsel’s prosecutorial authority under Section 3(d) of the National Labor Relations Act, and that the practice “poses administrative challenges and inefficiencies” for the Board.  Finally, the Board concluded that the policy of the Act does not support approval of consent orders.

Hospital Metropolitano overrules the 2017 decision in UPMC, 365 NLRB 1418 (2017), which expressly approved a judge’s authority to approve a consent order over the objection of the General Counsel and/or charging party if the proposed consent order met the reasonableness standards of Independent Stave Co., 287 NLRB 740 (1987) – a standard also applicable to settlement agreements between parties.  The Hospital Metropolitano majority made clear that it would continue to evaluate true settlement agreements – those between a respondent and at least one other party – under the Independent Stave standards, but clarified that consent orders are “not settlement agreements in any sense.”

In Hospital Metropolitano, the union accused the employer of violating the Act by refusing to provide the union with requested information.  There, the judge approved a consent order that “wholly comported” with the settlement agreement proposed by the General Counsel except that it contained a non-admission clause and did not include a provision explicitly requiring the respondent to distribute the notice to employees via text message.   Despite the consent order’s similarity to the General Counsel’s proposed settlement, the Board rejected the judge’s authority to approve the consent order and ordered the respondent to litigate or settle on terms acceptable to the General Counsel or the charging party.

Calling the majority’s decision “radical,” the dissent accused the ruling of giving the General Counsel “carte blanche” to force cases through litigation to suit her agenda. 

The Board’s press release announcing the decision can be found at this link.

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