NLRB ALJ Rules Puerto Rico Legal Aid Nonprofit Violated Labor Law With Unilateral Benefit Cuts

Administrative Law Judge Rebekah Ramirez ruled February 9, 2026, that Servicios Legales de Puerto Rico (SLPR) committed multiple unfair labor practices by implementing unilateral changes to wages and benefits without bargaining with two unions representing approximately 105 employees. The decision addresses whether requirements from the Legal Services Corporation (LSC)—which provides roughly 75% of SLPR's $16 million annual budget—excused the nonprofit's obligation to negotiate with unions before making employment changes.

The case began in March 2022 when union leaders sent a letter to LSC complaining about failed contract negotiations and stagnant wages. LSC President Ronald Flagg responded by imposing special grant conditions requiring SLPR to adopt new policies on partial-day absences and conduct a market analysis of leave benefits. SLPR subsequently eliminated payment for partial-day absences for attorneys (resulting in 100-1,000 salary deductions), reduced annual vacation accrual from 30 to 18 days, decreased maximum vacation carryover from 60 to 28 days, cut sick leave accrual from 18 to 15 days annually, and lowered sick leave carryover from 90 to 15 days—all without reaching agreement with the Unión de Abogados y Abogadas de Servicios Legales (UAASL) or Unión Independiente de Trabajadores de Servicios Legales (UITSL).

Judge Ramirez rejected SLPR's defense that LSC requirements created an "economic exigency" justifying immediate action without bargaining. The decision found that LSC never initiated formal questioned-cost proceedings, never threatened funding termination, gave SLPR until September 2022 to adopt policies (not requiring immediate salary deductions), and provided discretion in how to comply with grant conditions. The judge emphasized that federal regulations requiring grant costs be "reasonable" explicitly consider "arms-length bargaining" and "Federal laws"—which includes the National Labor Relations Act's duty to bargain.

The decision also found violations when SLPR delayed 10 weeks before providing UAASL with documents about LSC communications, and when SLPR distributed three employee memorandums blaming unions for triggering the LSC investigation—misrepresenting facts by concealing that SLPR's own March 2022 letter to LSC had criticized collective bargaining agreement provisions as "obstacles" and "troublesome."

The remedy requires SLPR to rescind all changes, restore pre-November 2022 vacation and sick leave benefits, resume paying attorneys for partial-day absences, provide backpay with interest for all affected employees, compensate employees for foreseeable pecuniary harms, address adverse tax consequences, post notices in English and Spanish, and bargain with unions before implementing any future changes. The decision reinforces that third-party funding requirements—even from major grantors providing three-quarters of an organization's budget—do not excuse employers' statutory duty to maintain the status quo and bargain with unions until reaching agreement or lawful impasse.

Key Points

• NLRB Administrative Law Judge found Puerto Rico legal services nonprofit violated federal labor law by making unilateral employment changes without bargaining with unions
• Employer received 75% of $16 million budget from Legal Services Corporation, which imposed special grant conditions on leave policies and pay practices
• Judge rejected "economic exigency" defense, finding LSC never threatened funding termination, gave months to comply, and provided implementation discretion
• Violations included eliminating attorney pay for partial-day absences (100-1,000 salary deductions), cutting annual vacation from 30 to 18 days, reducing vacation carryover from 60 to 28 days, and decreasing sick leave accrual and carryover
• Decision emphasizes that LSC regulations requiring "reasonable" costs explicitly reference "arms-length bargaining" and federal laws including National Labor Relations Act
• Remedy orders rescission of all changes, restoration of benefits, backpay with interest, and posting bilingual notices
• Case involved two unions: attorneys union (UAASL, ~50 members) with expired contract, and non-attorney workers union (UITSL, ~55 members) with current contract through 2026
• Judge also found employer violated law by delaying information requests 10 weeks and blaming unions in employee memos while concealing employer's own role in triggering investigation

Primary Source Author: Administrative Law Judge Rebekah Ramirez

Primary Source: Servicios Legales de Puerto Rico, Inc., JD-10-26 (February 9, 2026)

Primary Source Link: https://apps.nlrb.gov/link/document.aspx/09031d45841c1288

Supplemental Links

• National Labor Relations Board - What We Do
• National Labor Relations Act - Full Text
• NLRB - Employer/Union Rights and Obligations
• Legal Services Corporation - About LSC
• LSC - Our Grantees
• Servicios Legales de Puerto Rico - Organization Profile
• NLRB Administrative Law Judge Decisions
• NLRB San Juan Regional Office