A potentially massive shift in the labor relations arena — or at least the potential start of one — may have recently taken place. If so, the implications for leveraging collective bargaining negotiations and strategies in response to union organizing activity could be enormous. Employers and unions alike would be irresponsible not to take note and consider the impacts to their labor relations strategies.
On August 19, 2025, the United States Court of Appeals for the Fifth Circuit issued an opinion upholding three Texas district court decisions that bar the National Labor Relations Board (NLRB) from prosecuting unfair labor practice complaints against employers. At least in Texas, Louisiana, and Mississippi (the states covered by the Fifth Circuit), the practical upshot is that, as long as this decision holds, the unfair labor practice charge mechanism that unions strategically utilize (before an agency with a body of law generally tilted towards unions) just lost an awful lot of teeth.
In all three underlying cases, the employers argued that the structure of the NLRB (an Article II/executive agency) is unconstitutional because the National Labor Relations Act (an Article I/legislative act) authorizes the president to appoint board members — but then imposes restrictions on the executive’s ability to fire them. The same is true for NLRB administrative law judges (appointed by NLRB board members acting as the president’s delegate), who can only be removed on a “for cause” basis procedurally controlled not by the president or the NLRB but by a separate federal agency whose members are themselves shielded from removal. The Fifth Circuit agreed with the three lower courts’ conclusion that the employers were likely to prevail on the argument that this structure violates the separation of powers doctrine.
But, as significant as a “the NLRB is fundamentally unconstitutional!” takeaway from the Fifth Circuit seems, the more potentially seismic aspect of the ruling is the court’s decision to uphold preliminary injunctions precluding the NLRB Regional Officers from even conducting unfair labor practice adjudicatory proceedings. Essentially, the appellate court agreed that merely being subjected to a proceeding before unconstitutionally operating officers itself is a concrete injury sufficient to support injunctive relief. In other words, the Fifth Circuit essentially just decreed that “because the NLRB’s structure violates the Constitution, the NLRB has no power to act on unfair labor practice charges.”
Take a minute to ponder the ramifications of that.
Under the NLRA, unfair labor practice charges can only be prosecuted through the NLRB, but the NLRB now cannot prosecute such charges. No, one is not being hyperbolic to conclude that the implications of the Fifth Circuit decision render the entire unfair labor practice charge mechanism toothless.
I should point out my intentional use of words like “implications” and “ramifications”; for now, we are only talking about one panel of one appellate court. And while the whole three-judge panel agreed the structure of the NLRB is unconstitutional, one judge dissented from the conclusion that the structure of the NLRB in and of itself establishes sufficient harm to warrant an injunction precluding the NLRB from prosecuting unfair labor practice charges. Instead, that partially dissenting judge would have followed decisions from the Second, Sixth, and Tenth Circuits requiring more from the parties before interfering with the NLRB’s enforcement authority.
So, we now have a circuit split on a legal issue of tremendous import — a condition that often leads to more appellate litigation and Supreme Court intervention. In other moments in time, one might expect the NLRB to seek en banc review from the full Fifth Circuit or ask the Supreme Court to weigh in — but with the NLRB now helmed by recent political appointees, perhaps they will direct the NLRB to allow the Fifth Circuit decision to stand. On the other hand, those political appointees might want the current Supreme Court to decide such a fundamental issue.
Either way, one has to imagine the Fifth Circuit’s decision will spawn more litigation attacking current NLRB proceedings and seeking to enjoin them, so this issue is likely to garner sufficient attention. Ultimately, whether it gets there through the recent Fifth Circuit opinion or copycat litigation, this matter has “Supreme Court” written all over it. It’s simply too big of an issue to be left unresolved for long.
While this issue evolves, employers (and unions, too) have to account for how the NLRB being potentially rendered powerless to take enforcement action affects larger labor relations strategies and adjust accordingly. I am certainly not advocating that employers (or unions) start completely disregarding the NLRA’s rights and protections because there may no longer be consequences for doing so; we all have an obligation to follow and uphold the rule of law, particularly in these interesting times. But the reality is that unions often resort to the unfair labor practice charge process as a leverage tactic both during organizing campaigns and contract negotiations. Employers should certainly understand how a defanged NLRB dramatically impacts the value of such tactics and factor that into their own labor relations strategies.
