United States Supreme Court Strikes Down President Obama's Recess Appointments to the National Labor Relations Board—Hundreds of NLRB Decisions Invalidated

by BakerHostetler

In its much anticipated decision in National Labor Relations Board v. Noel Canning, 573 U.S. __ (2014), the Supreme Court of the United States has unanimously struck down President Obama’s recess appointments of Sharon Block, Richard Griffin, and Terence Flynn to the National Labor Relations Board (“NLRB” or “Board”) as unconstitutional. Accordingly, the Board was acting without the three-member quorum required by the National Labor Relations Act for more than a year-and-a-half—from the date of the President’s invalid recess appointments on January 4, 2012, until July 30, 2013, when the Senate confirmed a bi-partisan slate of members to bring the Board to its full five-member compliment. Consequently, all decisions issued by the Board during that time are now invalid. You can read our previous coverage of Noel Canning here and here.

The Court’s Noel Canning decision rests on narrow grounds. The Court refused to conclude, as urged by Noel Canning, that the President is constitutionally unable to make a recess appointment unless the appointment is made during an inter-session recess (i.e. a break between formal Congressional sessions) and the vacancy to be filled by the appointment arises during the recess. The Court instead preserved much of the President’s power and held that the Constitution’s Recess Appointments Clause, Art. II, §2, cl. 3, permits the President to make recess appointments during either an inter-session recess or an intra-session (e.g. a summer recess during a Congressional session) recess of the Senate regardless of whether the vacancy to be filled by the appointment arose during the recess itself or simply continued to exist into the recess.

The Court found fault with the specific appointments at issue in Noel Canning, however, based on the length of the recess during which they were made. When Block, Griffin, and Flynn were appointed to the NLRB in January of 2012, Congress was in the midst of a series of brief (two- and three-day) recesses with pro forma sessions between. The Court, analyzing the historical use of the recess appointment power, concluded that “[t]hree days is too short a time to bring a recess within the scope of the [Recess Appointments] Clause.” Thus, “the President lacked the power to make the recess appointments here at issue,” the Court held. As a result, the recess appointments of Block, Griffin, and Flynn are constitutionally infirm and are struck down. The Court made clear that other recess appointments, however, remain undisturbed.

Noel Canning’s most obvious impact for employers is that cases decided by the NLRB between January 4, 2012 and July 30, 2013 are invalid under the Supreme Court’s decision in New Process Steel v. NLRB, 560 U.S. 674 (2010). In New Process Steel, the Court held that the NLRB could not legally render decisions or otherwise act without a quorum of at least three members. Without Members Block, Griffin, and Flynn, the Board was without the requisite quorum from January 4, 2012 to July 30, 2013, and all decisions issued during that time are, accordingly, invalid.

Though the Board will now begin reconsidering and reissuing decisions invalidated by Noel Canning, employers should anticipate, at a minimum, that the reissued decisions will closely resemble those invalidated by today’s ruling. Following New Process Steel, the Board reconsidered and reissued hundreds of decisions without modifying the analysis or conclusion of the Board panel that originally issued them. The current Board is likely to do the same with many, if not all, of the decisions invalidated by the decision in Noel Canning.

There is, however, a possibility that the current Board will not simply rubber stamp the decisions that have fallen in Noel Canning’s wake. The Court’s decision gives the NLRB a unique opportunity to further push the employee- and labor-friendly agenda advanced during the current administration by re-deciding invalidated cases in ways more protective of employee rights. As with any other federal agency, the NLRB typically must wait for cases to work through the administrative process before setting labor policy. As a result of Noel Canning, the Board now has the opportunity to re-decide hundreds of cases presenting a multitude of labor relations issues in the near future. Consequently, employers should closely track the NLRB’s handling of cases struck down by Noel Canning and should be in contact with labor counsel concerning potential impacts on their business.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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