11/18/2025: 9th Circuit Upholds Thryv Remedies; 5th Circuit Joins 3rd In Rejecting Them
New circuit court tracking for the NLRB Research database!
I used the occasion of the government shutdown to completely rewrite the way my NLRB Research database tracks and stores decisions from circuit courts. I will have a longer post on this later, but the short of it is that the database now uses the Court Listener API instead of scraping Justia and the database now stores any circuit court decision that contains the phrase “National Labor Relations” in it rather than only storing circuit court decisions in which the NLRB is a party. This has resulted in a much better database than before.
Below are summaries of three circuit court decisions related to Thryv remedies that I did not send out while I was making these improvements (a subsequent post will include the summaries of the remaining circuit court cases).
NLRB v. Macy’s Inc., 23-188, (9th Circuit)
Factual and Procedural Background
Macy’s Inc. and the International Union of Operating Engineers, Local 39, engaged in negotiations for a successor collective bargaining agreement covering 60-70 building engineers and craftsmen at stores in Northern California and Nevada. After twelve bargaining sessions without agreement, Macy’s presented its Final Offer on August 31, 2020. The Union rejected it and initiated a three-month strike beginning September 4, 2020. Macy’s Final Offer expired on October 15, 2020. The Union submitted a new wage proposal on November 25, 2020, which Macy’s rejected on December 4, 2020.
On the evening of December 4, 2020, the Union made an unconditional offer to return members to work immediately. Macy’s requested time until December 7 to respond and told the Union not to have members report yet. The Union refused to wait. On December 7, Union members reporting to work were turned away. Macy’s informed the Union it would not reinstate employees until an agreement was in place. On December 10, Macy’s presented a new proposal with reduced wages, but the parties failed to reach agreement.
The Union filed unfair labor practice charges. An ALJ found Macy’s violated Section 8(a)(1) and (3) of the NLRA by locking out employees without providing a timely, clear, or complete offer setting forth reinstatement conditions. The Board affirmed on January 17, 2023, modifying the remedy to include compensation for direct or foreseeable pecuniary harms resulting from the lockout.
Legal Analysis
Unlawful Lockout
While employers may lawfully lock out employees after bargaining impasse to bring economic pressure supporting legitimate bargaining positions, an employer refusing to reinstate striking employees must show legitimate and substantial business justifications. The Board applied Dayton Newspapers, Inc., which requires unions be informed on a timely basis of employer demands so they can evaluate whether to accept them and prevent lockout. Employees must be clearly and fully informed of reinstatement conditions.
Substantial evidence supported the Board’s conclusion that Union employees were not clearly and fully informed of reinstatement conditions. At the December 7 lockout, neither the Union nor strikers knew Macy’s bargaining position—the Final Offer had expired and Macy’s had presented no other proposals. Macy’s failed to declare the lockout before or in immediate response to the Union’s unconditional return-to-work offer and failed to inform the Union fully and clearly of reinstatement conditions.
The court rejected Macy’s defensive lockout justification based on alleged strike misconduct and sabotage. The ALJ found these were post-hoc excuses and the true motive was gaining economic leverage. The Board’s credibility determinations received judicial deference given its special expertise.
Continuing Liability
Macy’s argued it cured the lockout’s taint by presenting a December 10 proposal. The court rejected this, holding that to cure a lockout, an employer must both restore the status quo ante and end the lockout. A lockout unlawful at inception retains its taint until terminated and affected employees are made whole. Macy’s failed to carry its burden of showing that failure to restore the status quo ante did not adversely affect subsequent bargaining. Evidence showed the Union made concessions indicative of a weakened bargaining position.
Remedies
The court found no clear abuse of discretion in the Board’s denial of the Union’s requested extraordinary remedies (management-present notice readings, extended posting, notice mailings, and affirmative violation language), as the record lacked evidence of repeat violations or egregious misconduct warranting such measures.
Regarding make-whole relief under Thryv, Inc., the court held the Board did not clearly abuse its discretion. The Board’s remedial authority under Section 10(c) permits affirmative action to effectuate Act policies. The court agreed the Board lacks authority to award “consequential damages” but found the Board did not award such damages here. The Board’s make-whole relief vindicates a public right by restoring what employees lost due to unfair labor practices, serving to eliminate industrial conflict rather than adjudicate private rights.
The court emphasized that Thryv remedies must be equitable and sufficiently tailored to expunge only actual, not speculative, consequences. The Board stated it will not issue orders for unquantifiable, speculative, or nonspecific harms. Direct or foreseeable pecuniary harms will be litigated in compliance proceedings where the General Counsel must prove they are not speculative and are specific and ascertainable. Specific relief determinations await the compliance proceeding.
Partial Dissent
Judge Bumatay dissented, arguing the Board exceeded its statutory authority by ordering compensation for direct or foreseeable pecuniary harms, which constitutes consequential damages unauthorized by the NLRA. He contended this implicates Seventh Amendment jury trial rights, the Board’s merits decision was arbitrary and capricious, and the Board improperly created a rule requiring employers to provide detailed proposals within one business day of a return-to-work offer.
Significant Cases Cited
American Ship Building Co. v. NLRB, 380 U.S. 300 (1965): Employers may lawfully lock out employees after bargaining impasse to bring economic pressure supporting legitimate bargaining positions.
NLRB v. Fleetwood Trailer Co., 389 U.S. 375 (1967): Employer refusal to reinstate striking employees constitutes an unfair labor practice unless the employer shows legitimate and substantial business justifications.
NLRB v. Great Dane Trailers, Inc., 388 U.S. 26 (1967): Established framework distinguishing between inherently discriminatory employer conduct and conduct with comparatively slight adverse effects on employee rights.
Dayton Newspapers, Inc., 339 NLRB 650 (2003): For lawful lockouts, unions must be timely informed of employer demands and employees must be clearly and fully informed of reinstatement conditions.
Phelps Dodge Corp. v. NLRB, 313 U.S. 177 (1941): The Board’s remedial function is restoring the situation as nearly as possible to what would have occurred absent the violation.
NLRB v. v. North Mountain Foothills Apartments, LLC, 24-2223 (9th Circuit)
The Ninth Circuit granted the NLRB’s petition for enforcement of its order finding that North Mountain Foothills Apartments violated Section 8(a)(1) of the National Labor Relations Act by discharging an employee for discussing his compensation with coworkers.
Jurisdictional and Constitutional Challenges
The court first addressed whether it had jurisdiction to consider NMFA’s constitutional challenges, which were raised for the first time on appeal. The court held that it could review unexhausted constitutional claims concerning the agency’s structure under the extraordinary circumstances exception, reasoning that agency adjudications are generally ill-suited to address structural constitutional challenges and requiring exhaustion would be futile where adjudicators lack power to grant relief.
On the merits of the constitutional challenges, the court addressed three separate claims. First, NMFA challenged the for-cause removal protections for administrative law judges as violating Article II. While the NLRB withdrew its defense of these protections during the appeal, the court nevertheless rejected NMFA’s challenge because NMFA failed to demonstrate any harm from the removal provisions. The court explained that retrospective relief based on an unconstitutional removal provision requires showing that the provision inflicted compensable harm, which NMFA had not done.
Second, NMFA argued that the NLRB’s adjudication scheme violated the Seventh Amendment right to jury trial, particularly in light of the NLRB’s recognition of Thryv remedies for direct and foreseeable pecuniary harms. The court rejected this argument, holding that NLRB unfair labor practice proceedings are not suits at common law for Seventh Amendment purposes. The court emphasized that Thryv remedies are equitable in nature because they are designed solely to restore the status quo rather than to punish or deter wrongdoers.
Third, NMFA contended that the combination of investigatory and adjudicatory functions within the NLRB violated the Fifth Amendment’s due process clause. The court rejected this challenge, noting that the NLRB maintains a bifurcated structure with the General Counsel supervising investigations and the Board responsible for adjudication. NMFA failed to show that a single individual exercised both functions or that there was an unconstitutional potential for bias among ALJs or Board members.
Merits of the Discharge Finding
On the substantive merits, the court found that NMFA had forfeited three of the four Section 8(a)(1) violations by failing to properly challenge them below. The court applied the Wright Line test to the remaining claim regarding Press’s discharge. Under this framework, the General Counsel must show that protected conduct was a motivating factor in the employer’s decision, after which the burden shifts to the employer to demonstrate it would have taken the same action absent the protected activity.
The court first determined that discussing compensation constitutes protected concerted activity under the NLRA because wages are a vital term and condition of employment. Substantial evidence supported the finding that Press engaged in such activity when he spoke with coworkers about his hourly rate and housing subsidy in response to challenging working conditions.
The court found substantial evidence that NMFA was aware of this activity and that it motivated the discharge decision. During a closed-door meeting the day before Press’s termination, management told Press that his compensation discussions were making life “really tough,” constituted a “red-hot issue” and “crisis situation,” and had “backfired, really bad.” These statements provided a substantial basis to conclude that the protected activity played a meaningful role in the discharge.
NMFA failed to meet its burden of showing it would have discharged Press regardless of his protected activity. The company claimed the decision was based on poor work performance, but management never mentioned performance issues during the meeting the day before termination, focusing instead on the compensation discussions. Additionally, NMFA’s evidence that it had similarly discharged other new hires was vague and conclusory.
The court granted enforcement of the NLRB’s order, which required NMFA to cease and desist from the violations, reinstate Press, make him whole for lost earnings and benefits, and post a remedial notice.
Significant Cases Cited
Collins v. Yellen, 594 U.S. 220 (2021): Retrospective relief based on an unconstitutional removal provision is available only where the provision inflicts compensable harm.
SEC v. Jarkesy, 603 U.S. 109 (2024): To determine whether an action is a suit at common law for Seventh Amendment purposes, courts consider whether the action is akin to one traditionally brought before a court of law or equity and whether the remedies are legal or equitable in nature, with the nature of the remedy being the more important consideration.
NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937): An NLRB unfair practice proceeding is not a suit at common law for purposes of the Seventh Amendment because it is a statutory proceeding unknown to the common law with equitable remedies.
Wright Line, 251 NLRB 1083 (1980): Established the framework for determining whether an employer violated Section 8(a)(1) by requiring the General Counsel to show protected conduct was a motivating factor in the employer’s decision, then shifting the burden to the employer to prove it would have taken the same action absent the protected activity.
Carr v. Saul, 593 U.S. 83 (2021): Agency adjudications are generally ill-suited to address structural constitutional challenges, which usually fall outside the adjudicators’ areas of technical expertise, and a futility exception applies to exhaustion requirements.
Hiran Management v. NLRB, 24-60608 (5th Circuit)
The Fifth Circuit held that the National Labor Relations Board lacks statutory authority to award full compensatory damages for all direct and foreseeable harms stemming from unfair labor practices, limiting the Board to equitable remedies under Section 10(c) of the National Labor Relations Act.
Background
Hiran Management operated Hungry Like the Wolf, a small Houston karaoke restaurant employing approximately twenty workers. In September 2022, eight front-of-house employees went on strike after disputes with their manager over additional duties and compensation promises. The employer terminated the striking employees in October 2022. The NLRB filed an administrative complaint alleging violations of Section 8(a)(1) of the NLRA, which prohibits interference with employees’ rights to engage in concerted activities. An administrative law judge ruled for the NLRB, and the Board ordered Hiran to reinstate the employees and make them whole for any loss of earnings, benefits, and “any other direct or foreseeable pecuniary harms” resulting from the unfair labor practices.
Supervisory Status
Hiran argued that four of the discharged employees were supervisors rather than employees and therefore not protected by the NLRA. The court found this defense was waived because Hiran failed to raise it until its post-hearing brief to the ALJ. This untimely assertion deprived the Board of a full opportunity to develop an evidentiary record in opposition. The court found the approach consistent with its decision in Strand Theatre. Even on the merits, Hiran failed to demonstrate that the employees exercised independent judgment in their occasional supervisory duties, such as opening or closing the restaurant or assisting with scheduling.
Remedial Authority Analysis
The court’s primary holding addressed whether the NLRB possessed statutory authority to order damages for all foreseeable harms under Section 10(c) of the NLRA. Section 10(c) authorizes the Board to order employers to cease and desist from unfair labor practices and to take affirmative action, including reinstatement with or without back pay, to effectuate the Act’s policies.
The court applied the traditional distinction between legal and equitable remedies, rooted in the historical division between courts of law and courts of equity. Equitable remedies include injunctions and restitution, while compensatory damages constitute the classic form of legal relief. The court determined that Section 10(c) limits the NLRB to equitable remedies. The language authorizing the Board to order employers to “cease and desist” or “take affirmative action” permits only equitable relief. Reinstatement and backpay, the two types of affirmative action expressly mentioned in the statute, are forms of equitable relief designed to restore what was taken from employees.
The court reinforced this interpretation by comparing Section 10(c) with Section 706(g) of Title VII, which was expressly modeled on the NLRA provision. Congress amended Title VII in 1972 to specify that courts could award “any other equitable relief” and again in 1991 to include compensatory and punitive damages. The court reasoned that if Section 706(g) required explicit amendments to authorize compensatory damages, then Section 10(c) must remain limited to equitable remedies until Congress similarly amends the NLRA. The court cited Pollard for the proposition that courts should consult Section 10(c) for guidance on interpreting the same language in Title VII.
The court rejected the NLRB’s argument that it had frequently ordered monetary relief beyond lost wages. While the Board cited cases involving health insurance benefits, medical expenses, and retirement benefits, the court characterized these as falling “under the umbrella of a backpay award” rather than establishing broad remedial power. These remedies remained closely tied to restoring employment contract benefits and did not constitute ordinary compensatory damages.
The Thryv Framework
In 2022, the NLRB announced in Thryv that it would order compensation for “all direct or foreseeable pecuniary harms” resulting from unfair labor practices. The Board identified such harms as potentially including credit card interest and late fees, early withdrawal penalties from retirement accounts, loan or mortgage payments, transportation or childcare costs, and various other expenses. The General Counsel later expanded this list to include unreimbursed tuition, job search costs, utility fees, relocation costs, legal fees in eviction proceedings, and immigration-related expenses.
The Fifth Circuit determined that this Thryv remedy constitutes legal damages rather than equitable relief. The court explained that compensatory damages aim to redress concrete losses suffered by reason of wrongful conduct, while consequential damages include losses that flow indirectly from an injurious act. Many harms listed in Thryv qualify as consequential damages. The court noted that a former NLRB chairman had acknowledged that items like credit card late fees and early withdrawal penalties are consequential damages.
The Board attempted to characterize the Thryv remedy as equitable by arguing that make-whole relief restores the status quo. The court rejected this argument, noting that if restoration of the status quo alone rendered relief equitable, then all compensatory damages could qualify as equitable remedies. This would eliminate any principled distinction between legal and equitable relief, contradicting established law that compensatory damages are legal remedies.
Circuit Split
The court acknowledged a circuit split on this issue. The Third Circuit in Starbucks disapproved the Board’s expansion of remedies, while the Ninth Circuit in International Union of Operating Engineers upheld the Thryv framework. The Fifth Circuit sided with the Third Circuit, holding that Thryv represents legal rather than equitable damages and exceeds the NLRB’s authority under the NLRA.
The court distinguished the Ninth Circuit’s reasoning in International Union of Operating Engineers, which held that the foreseeable harm provision furthers the NLRA’s policy by restoring economic strength necessary to return to the status quo ante. While acknowledging that the Act’s purpose is to make workers whole for losses from unfair labor practices, the court emphasized that the NLRB can only effectuate this purpose using authorized remedies. The court cited Russell and Consolidated Edison for the principle that the Board’s authority to order affirmative action does not extend to any penalty the Board might believe would effectuate the Act’s policies.
Holding and Disposition
The court granted Hiran’s petition in part, denied the NLRB’s cross-petition for enforcement in part, and remanded for further proceedings. Because the court concluded the NLRB exceeded its statutory authority by awarding compensatory damages, it found it unnecessary to address Hiran’s constitutional arguments under Article III, the Seventh Amendment, the Due Process Clause, and the major questions and nondelegation doctrines.
Significant Cases Cited
UAW-CIO v. Russell, 356 U.S. 634 (1958): The NLRB’s power to order affirmative relief does not include a general scheme authorizing the Board to award full compensatory damages for injuries caused by wrongful conduct.
Pollard v. E.I. du Pont de Nemours & Co., 532 U.S. 843 (2001): Courts should consult NLRA Section 10(c) for guidance on interpreting the same language in Title VII’s Section 706(g), which was expressly modeled on the NLRA provision.
NLRB v. Starbucks Corp., 125 F.4th 78 (3d Cir. 2024): The Third Circuit disapproved the Board’s expansion of remedies under Thryv, concluding that the remedy goes beyond the text of the NLRA.
Int’l Union of Operating Eng’rs, Loc. 39 v. NLRB, 127 F.4th 58 (9th Cir. 2025): The Ninth Circuit upheld the Thryv remedial scheme, creating a circuit split on whether the NLRB may award damages for all foreseeable harms.
Mertens v. Hewitt Assocs., 508 U.S. 248 (1993): Compensatory damages that compensate for losses sustained as a result of alleged breach of duties are the classic form of legal relief, while injunctions and restitution are traditionally viewed as equitable remedies.