Hunton Employment & Labor Perspectives

On August 22, 2024, the Board ended its 50-year history of allowing consent orders in unfair labor practice cases.  In Metro Health Inc. d/b/a Hospital Metropolitano Rio San Pedras, the Board held that: “in all pending and future unfair labor practice cases, the Board will not terminate the case by accepting or approving a consent order.”

The Board’s decision marks a reversal of 50 years of precedent.  Since 1971, the Board has allowed parties to resolve unfair labor practice charges through consent orders.  Unlike a traditional, bilateral settlement agreement, in which the respondent (often the employer), charging party, and General Counsel all agree to the terms of a settlement, a consent order is a resolution proposed by the respondent without the agreement or consent of the General Counsel and/or the charging party.  Under the Board’s longstanding precedent, an employer could present a consent order to the presiding Administrative Law Judge, who would evaluate whether the terms of the consent order were reasonable and effectuated the purposes of the National Labor Relations Act.

Over the years, consent orders have been a valuable tool for resolving unfair labor practice charges without the need for protracted litigation, even when the parties could not reach a deal on all of the terms of a proposed settlement.  In Metro Health, for example, the employer presented a consent order to the ALJ that fully resolved the unfair labor practice charges against it and included all of the General Counsel’s desired settlement terms except that the consent order contained a non-admission clause (which is a standard term in most non-Board settlement agreements) and did not include a provision requiring the employer to distribute the notice via text message.  The ALJ agreed that the proposed resolution was fair, reasonable, and effectuated the purposes of the Act, notwithstanding that it did not fully comport with the General Counsel’s desired terms.  As such, the ALJ approved the consent order over the General Counsel’s objection.

Despite the obvious utility of consent orders, the Board has now abandoned that practice, holding that consent orders are not authorized by the Board’s Rules and Regulations, create administrative difficulties and inefficiencies, and tend to interfere with the prosecutorial authority of the General Counsel.  On that last point, the Board reasoned that the question of “whether to approve a consent order bears the hallmarks of a prosecutorial decision” and, for an ALJ to approve a consent order over the objection of the General Counsel, “intrudes into the General Counsel’s statutory role.”  As such, the Board concluded that it could no longer accept consent orders under the Act.

Though the full effect of the Board’s decision is still yet to be determined, it is safe to assume that the Board’s decision will likely complicate pre-hearing settlement discussions and reduce the chances of early resolution.