U.S. Circuit Court Holds Haven Salon + Spa in Contempt, Orders Payment of Fines and NLRB Attorney Fees

On February 27, 2023, the United States Court of Appeals for the Seventh Circuit (the Court) granted the NLRB’s Petition for contempt against Haven Salon + Spa, Inc. for failing to comply with a Board Order remedying Haven’s unlawful termination of an employee who engaged in protected concerted activity, which was enforced by the Court. To remedy Haven’s failure to comply, the Court ordered Haven to fully comply with the Board’s Order, pay all reasonable costs and expenses, including attorney’s fees, and pay a fine of $1,000, in addition to escalating daily fines, if Haven continued not to comply with the Court’s order.

As the Seventh Circuit explained, “Parties ignore court orders at their peril. . . . [T]he point applies with full force to orders of the National Labor Relations Board.”

In May 2020, Haven unlawfully fired an employee after protesting working conditions on behalf of herself and her co-workers, specifically that Haven was not doing enough to protect employees from COVID-19. After Haven heard that the employee had filed an unfair labor practice charge with the NLRB, Haven threatened legal action against her and her family.

After a hearing at which Haven failed to appear or participate, an Administrative Law Judge (ALJ) found that Haven had unlawfully terminated and threatened the employee in violation of the National Labor Relations Act. The ALJ recommended that the Board order Haven to compensate the employee for lost pay and expenses, offer reinstatement, notify the employee that it had removed references of her unlawful termination from the employee file, post notices of employee rights in its store locations, and file a sworn certification with the Board attesting to its compliance. The Board then adopted the ALJ’s order in the absence of exceptions. The Board asked the Court to summarily enforce its Order, which it did in September 2021.

Because Haven wholly failed to comply with significant parts of the court-enforced Board Order, the Seventh Circuit held Haven in contempt, ordered Haven to pay the NLRB’s attorney’s fees and costs, and imposed fines that are forgivable only if Haven fully complies within one week of the Court’s Order.

NLRB General Counsel Jennifer Abruzzo noted, “We agree wholeheartedly with the Seventh Circuit’s view that noncompliance with court-enforced Board orders cannot stand. This case is a demonstration of the NLRB’s commitment to pursue all available remedies for victims of unfair labor practices under the NLRA and vigorously pursue legal action to ensure violators comply with Board orders and settlements.”