What's Next for the National Labor Relations Board and Employers?

04 February 2013 Labor & Employment Law Perspectives Blog

As we reported last week , the D.C. Circuit Court of Appeals recently invalidated President Obama’s purported recess appointments to the National Labor Relations Board made in January 2012, rendering the Board without a quorum and potentially unable to conduct much of its normal business. As the implications of the decision continue to develop, we look at what employers might do to take advantage of the decision.For its part, the Board insists that it is business as usual. Board Chairman Mark Gaston Pearce has issued a statement “respectfully disagree[ing]” with the D.C. Circuit’s decision. Chairman Pearce also has attempted to limit the decision’s damage to the Board, insisting that it “applies to only one specific case.” Similarly, President Obama’s press secretary claimed that the decision was limited to “one court, one case, one company” and that it would have no impact on the ongoing operations of the Board.

Despite the aggressive posture from the executive branch, it is not clear how the Board can continue operating in the face of this ruling. The Board persists in functioning with the same members whose appointments the D.C. Circuit just invalidated. Additionally, Board decisions are not self-enforcing, meaning that employers (and unions) are required to comply with them only if a court “enforces,” or approves, the Board’s decision. By law, employers can appeal any Board decision to the D.C. Circuit, which just found the Board to be acting outside of constitutional bounds. Therefore, we think it is highly likely that the D.C. Circuit will continue to rule that the appointments were unconstitutional and refuse to enforce any order from the Board. As a consequence, unless the Supreme Court reverses the recent decision or the entire D.C. Circuit decides to review the case, it seems unlikely that the Board will be able to issue any binding orders until new members are approved by the U.S. Senate.

However this issue ultimately gets resolved, employers might be wise to take a few steps to protect their interests while uncertainty reigns. First, it is essential that employers preserve their challenges to the Board’s quorum. As a practical matter, that means explicitly arguing in every written submission to the Board that it lacks any authority to resolve the case. Second, in the face of an adverse ruling from the Board, consider whether it makes sense to appeal the decision to the D.C. Circuit. As long as the D.C. Circuit’s recent ruling remains controlling law, it is unlikely that the D.C. Circuit will enforce any decision from the Board.

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