NLRB to Seek Supreme Court Review of Recess Appointment Issue

In January 2013 the District of Columbia Circuit Court of Appeals put the validity of hundreds of NLRB case decisions and regulatory actions in doubt. In a ruling involving Noel Canning, a Washington State company accused of unfair labor practices, the Court determined that two of the three Board members ruling against the employer lacked authority due to unconstitutional appointments from the President. The Court determined that the two Board members’ recess appointments did not properly occur during a recess between sessions of Congress and the vacancies they filled did not open during a recess between sessions of Congress. The same Board members acted on hundreds of other cases. Additionally, similarly situated past Board members with recess appointments may also be affected.

The National Labor Relations Board immediately announced disagreement with the Court’s ruling in Noel Canning. The Agency confirmed it would assess its options, including whether to seek en banc review from the District of Columbia Circuit Court of Appeals or to seek review at the United States Supreme Court.

Meanwhile many accused parties in NLRB cases raised the Noel Canning ruling as a defense to action against them. Many more accused parties will likely do so as the cloud of the Noel Canning ruling hangs over the NLRB and its assertion of authority to regulate workplace issues.

On March 12, 2013, the NLRB announced it will seek review of the Noel Canning ruling at the United States Supreme Court. This means a petition for certiorari will be filed and the Court will decide whether to take the case. The recess appointment issue involves a significant question of Constitutional interpretation, affecting NLRB actions and appellate court litigation across the country, as well as the President’s authority to make agency appointments when Senate confirmation is an obstacle. The issue also goes one step beyond the two-member NLRB quorums ruled unlawful in the 2011 New Process Steel decision, where the Board was described as a dog’s tail wagging “after the dog died.” While such petitions are granted less than five percent of the time, the likelihood that the Supreme Court will agree to review this case may be greater than the statistical norm.

Employers should stay tuned for developments, as what occurs will affect enforcement of labor law across the country. Parties facing NLRB cases should carefully review whether the Noel Canning issues affect their cases.

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