NLRB Weighs in on Stay-or-Pay Agreements

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In a recent move following the McLaren Macomb case, the National Labor Relations Board (“NLRB”) general counsel (“GC”) issued guidance on October 7, 2024, indicating that “stay-or-pay” clauses may violate labor laws.

Key Points

  • The GC’s memo warns employers that employment terms requiring employees to stay for a set time or repay certain expenses could be illegal.
  • The GC plans to seek broader remedies for overly broad noncompete and stay-or-pay agreements.

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NLRB’s Landmark Decision Reshapes Employer Work Rules: Stericycle, Inc. and Teamsters Local 628 (372 NLRB No. 113, 2023)

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In a pivotal move that again reshapes the landscape of employer-employee relations, the National Labor Relations Board (NLRB) recently issued a significant decision in the case of Stericycle, Inc. and Teamsters Local 628. This ruling (372 NLRB No. 113, 2023) ushers in a new era for evaluating employer work rules and policies, marking a departure from previous standards and a notable shift toward prioritizing employee rights.  In Stericycle, the Board reviewed the decision of an administrative law judge who found that the Respondent violated Section 8(a)(1) by maintaining certain rules for its employees that  addressed personal conduct,

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U.S. Supreme Court Upholds Class Action Waivers in Arbitration Agreements

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Yesterday, May 21, 2018, the United States Supreme Court finally resolved a split among the federal circuit courts regarding whether the National Labor Relations Act (“NLRA”) prohibits businesses from requiring employees to sign arbitration agreements that waive their right to engage in a class action against their employer.  Epic Systems Corp. v. Lewis (No. 16–285).

At issue were two federal laws that appear to conflict with one another.

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