09/19/2025: Confidentiality Provision in Huawei Severance Agreement Violated NLRA
Employer unlawfully withdrew recognition of union.
Futurewei Technologies, Inc., JD(SF)-20-25, 19-CA-318158 (ALJ Decision)
This NLRB decision addresses whether Futurewei Technologies, Inc. violated the National Labor Relations Act (NLRA) by offering separation agreements containing unlawful confidentiality provisions. Administrative Law Judge Robert A. Ringler presided over the hearing in Seattle, Washington.
The case involved Vinay Kulkarni, who worked in research and development at Futurewei. On February 1, 2023, Kulkarni was informed that the Bellevue facility was closing, and he would be separated from employment. He received a Separation Agreement offering financial consideration in exchange for releasing employment-related claims against the company.
The General Counsel specifically challenged Section 11 of the agreement, titled "Confidentiality." This provision required employees to maintain "complete confidence" regarding the existence, contents, terms, and consideration of the agreement (collectively called "Separation Information"). The provision severely limited disclosure, allowing employees to share this information only with immediate family members, in enforcement proceedings, with counsel, and with accountants or tax advisors who needed the information. The provision expressly prohibited publicizing any Separation Information directly or indirectly to other third parties.
The confidentiality provision also included enforcement mechanisms, stating that if Futurewei proved a breach, the company would be entitled to costs and reasonable attorneys' fees regardless of whether actual damages could be established.
In his analysis, Judge Ringler found the Confidentiality provision unlawful. The judge applied a reasonable person standard to determine whether, under the totality of circumstances, the employer's action would reasonably tend to restrain, coerce, or interfere with employees' Section 7 rights.
The judge relied on the Board's recent precedent in McLaren Macomb, which established that an employer violates the Act when it conditions acceptance of a severance agreement and consideration upon the forfeiture of Section 7 rights, unless the waiver is "narrowly tailored." The Board in that case emphasized that discussing terms and conditions of employment is protected activity that extends to former employees and can occur through channels outside the immediate employment relationship.
Judge Ringler concluded that the Confidentiality provision was unlawful because it broadly required former employees to waive their rights to discuss the severance package (which constitutes wages, hours, and other terms and conditions of employment) in exchange for financial consideration. The judge noted that the waiver was unlimited in scope and lacked any effort to "narrowly tailor" its breadth to preserve protected discussions about the agreement's terms with former workers.
As a remedy, the judge ordered Futurewei to:
Cease and desist from providing separation agreements with unlawfully overbroad confidentiality provisions
Rescind the unlawful confidentiality provisions
Notify in writing all former employees who signed the agreements that the provisions have been rescinded and will not be enforced
Post notices at the facility regarding the violations and remedies
The decision was dated September 18, 2025.
Significant Cases Cited
McLaren Macomb, 372 NLRB No. 58 (2023): Established that employers violate the NLRA when they condition severance agreements on waiver of Section 7 rights without narrowly tailored provisions.
J. Picini Flooring, 356 NLRB 11 (2010): Referenced for the notice posting requirements as part of the remedy.
Sunnyside Home Care Project, 308 NLRB 346 (1992): Established the reasonable person standard for determining interference with Section 7 rights.
Laborforce, LLC, M&K Employee Services, and M&K Truck Centers, as Joint Employers and/or Alter Egos, JD-79-25, 13-CA-321415 (ALJ Decision)
This NLRB decision concerns a labor dispute involving three related entities: Laborforce, LLC, M&K Employee Services, and M&K Truck Centers (collectively "Respondents") at their Summit, Illinois facility. The case centers on allegations that the Respondents violated the National Labor Relations Act (NLRA) by improperly withdrawing recognition from Automobile Mechanics' Local 701 (the Union) and making unilateral changes to employment terms.
The decision, issued by Administrative Law Judge Melissa M. Olivero on September 18, 2025, addresses three consolidated cases filed by the Union between July 2023 and June 2024. The key events involved two separate attempts by Respondents to withdraw recognition from the Union.
Background Facts
M&K Truck Centers operates 28 truck dealerships across the Midwest. Laborforce and M&K Employee Services leased employees to M&K Truck Centers. Employees at the Summit facility had been represented by the Union since the 1950s, with a collective bargaining agreement (CBA) in effect from October 1, 2020, to September 30, 2027.
The bargaining unit consisted of both parts department and service department employees. In July 2023, employee Joe Loman gathered signatures from 19 parts department employees (out of 31) indicating they no longer wanted Union representation. However, the entire bargaining unit contained 82 employees (31 parts department, 51 service department).
First Withdrawal of Recognition
Despite having signatures from less than a majority of the entire unit, Respondents threatened to withdraw recognition from the Union for parts department employees on July 7, 2023, effective September 30, 2023. Respondents proceeded with this withdrawal on October 1, 2023, moved parts department employees to new benefits plans, and refused to process grievances for these employees.
Second Withdrawal of Recognition
In June 2024, Respondents obtained signatures from 36 of 70 employees in the combined parts and service departments and withdrew recognition from the Union for the entire bargaining unit on June 10, 2024. Respondents then changed the 401(k) plan and denied Union representatives access to the facility.
Legal Analysis
The ALJ first analyzed whether the Respondents functioned as joint employers and/or alter egos. Finding that Respondents shared control over essential terms and conditions of employment, the ALJ determined they were joint employers. The ALJ also found alter ego status based on their integrated operations and attempts to avoid collective bargaining obligations through what appeared to be a "sham transaction."
Regarding the bargaining unit, the ALJ rejected Respondents' contention that parts and service departments constituted separate units, finding instead that the CBA described a single unit.
The ALJ determined that Respondents violated Section 8(a)(1) of the NLRA by threatening to withdraw recognition in July 2023 without sufficient evidence that the Union had lost majority support. The first actual withdrawal on October 1, 2023, violated Section 8(a)(5) and (1) because it was based on signatures from less than a majority of the entire unit.
The ALJ found that the second withdrawal of recognition in June 2024 also violated the Act because it was tainted by the prior unfair labor practices. Applying the factors from Master Slack Corp., the ALJ determined that Respondents' prior unlawful conduct created employee disaffection that tainted the second petition.
The unilateral changes to the 401(k) plan and denial of Union access to the facility were found to violate Section 8(a)(5) and (1) as changes to mandatory subjects of bargaining without notice or opportunity to bargain.
Remedy
The ALJ ordered Respondents to cease and desist from these unfair labor practices, recognize and bargain with the Union, make employees whole for any losses, restore the terms of the CBA, remit any required benefit fund payments, and post an appropriate notice.
Significant Cases Cited
Levitz Furniture, 333 NLRB 717 (2001): Established that an employer withdrawing recognition must prove actual loss of majority support.
Master Slack Corp., 271 NLRB 78 (1984): Set forth four factors to determine whether unfair labor practices tainted subsequent employee disaffection from a union.
T-Mobile USA, Inc., 365 NLRB 175 (2017): Reinforced that employers withdraw recognition at their own peril and must show actual loss of majority support.
AT Systems West, Inc., 341 NLRB 57 (2004): Clarified that not all unremedied violations preclude lawful withdrawal of recognition, only those that affect union status or cause employee disaffection.
Ogle Protection Service, 183 NLRB 682 (1970): Established the method for computing make-whole remedies for employees.