Circuit Court Holds NLRB Recess Appointments Unconstitutional

Last week we promised Part 2 of our Alert series concerning the NLRB’s recent activity.  We will deliver on that promise (stay tuned) but first we must address Friday’s decision by the D.C. Circuit Court of Appeals holding that President Obama’s appointments in January 2012 of three Board members were unconstitutional.

This case reached the D.C. Circuit when an employer, Noel Canning, appealed an order of the Board finding that it had committed an unfair labor practice by refusing to execute in writing a collective bargaining agreement it had allegedly agreed to orally.  As is normally the case, the employer and union presented conflicting facts concerning whether there had ever been an oral agreement.  Ordinarily, a court of appeals reviewing a Board unfair labor practice finding such as this one would review whether the Board’s finding was based on “substantial evidence.”  In this case, however, the D.C. Circuit held that the Board decision was invalid regardless of the evidence because at the time of the decision the Board lacked a quorum to act because three of its five members had been unconstitutionally appointed to the Board as “recess appointments.”

Board members are nominated by the President and must be approved by the Senate.  There is a Recess Appointments Clause in the Constitution giving the President the authority to “fill up all Vacancies that may happen during the Recess of the Senate” without obtaining Senate approval.  At the time the Constitution was drafted, the Senate did not operate as the year-round body it is today.  Rather, the Senate regularly held recesses lasting for months on end and, of course, Senators could not fly or drive back to Washington on a moment’s notice to approve presidential appointments.  Thus, there was a very practical reason for providing for recess appointments.

As anyone who pays attention to the confirmation process today knows, recess appointments are no longer simply used when Senators are unavailable but have become political tools used by modern presidents when confirmation of appointees is unlikely.  The Senate, in turn, employs its own rules and tactics to delay, avoid, or block presidential nominations.  In other words, the modern appointment process is a power struggle between the executive and legislative branches of government as well as the two political parties.

The three members whose appointments were challenged by Noel Canning were all appointed by President Obama in January 2012 while the Senate was operating pursuant to a unanimous consent agreement which provided that, rather than adjourn into an official “recess,” it would meet in pro forma sessions every three business days but would not conduct business during those sessions.  The three member panel of the D.C. Circuit unanimously interpreted “recess” to mean intersession recess, or the period between sessions of the Senate.  The Court rejected the Board’s position that intrasession recesses, or breaks in the Senate’s business when it is otherwise in session, fit within the meaning of “recess” in part reasoning that the Board’s position could result in the situation when the President could make “recess appointments” during the Senate’s lunch break.  Because the Senate continued to hold its pro forma sessions in January 2012, the Court held it was not in an intersession recess and the appointments were invalid.  The Court acknowledged that over the past several decades, presidents have made liberal use of intrasession recess appointments, but noted that the fact that they have become somewhat common does not make them constitutional.  Two members of the Court further found the appointments unconstitutional because the vacancies the three members had been appointed to fill did not “happen” during a recess because the vacancies had initially “arisen” while the Senate had been in session.  (The other member of the panel declined to reach the issue).

As you know, this particular Board has been an active one.  The D.C. Circuit decision puts in question the enforceability of the Board’s hundreds of decisions made in the past year, several of which are currently being challenged on recess appointments grounds.  However, the decision is confined to vacating the unfair labor practice finding against Noel Canning, and the NLRB has issued a statement that it intends to continue deciding and processing cases until the issue is finally resolved.  We note that the D.C. Circuit decision is at odds with several other Circuit Court decisions interpreting “recess” to include intrasession breaks and interpreting “happen” to include vacancies that “exist” during a recess regardless of when the vacancy first arose.  The uncertainty surrounding the enforceability of this Board’s decisions will likely need to be resolved by the Supreme Court and no one knows whether the D.C. Circuit decision will become the law of the land.  Until that occurs, all decisions by the current Board are subject to challenge.