National Labor Relations Board Returns To Pre-Baylor Approach For Evaluating Severance Agreements

On February 21, 2023, the National Labor Relations Board (the "Board") issued a decision in McLaren Macomb holding that employers cannot offer employees severance agreements that require employees to broadly waive their rights under the National Labor Relations Act (the "Act"). This decision overturns the previous Board's 2020 decisions in Baylor University Medical Center (369 NLRB No. 43 (2020)) and IGT d/b/a International Game Technology (370 NLRB No. 50 (2020)), which in turn had overruled longstanding precedent. As explained by the Board in the McLaren decision:

"[a]greements that contain broad proscriptions on employee exercise of Section 7 rights have long been held unlawful because they purport to create an enforceable legal obligation to forfeit those rights. Proffers of such agreements to employee[s] have also been held to be unlawfully coercive. The Board in Baylor University Medical Center and IGT d/b/a International Game Technology reversed this