Decision on NLRB Rule Draws Mixed Reviews As Business, Labor Await Board’s Next Move

Representation Elections

By Lawrence E. Dubé
After a federal district court ruled May 14 that National Labor Relations Board changes in election case rules were invalid and unenforceable, business groups supported the ruling, but labor supporters criticized it, and the NLRB chairman vowed to back the rule changes.

Judge James E. Boasberg of the U.S. District Court for the District of Columbia said rule changes NLRB implemented April 30 were not properly adopted by a quorum of three board members seated on the board in December 2011 (Chamber of Commerce v. NLRB, D.D.C., No. 11-cv-2282, 5/14/12) (93 DLR AA-1, 5/14/12). Boasberg said, however, a “properly constituted quorum” might now approve the changes “if it has the desire to do so.”

NLRB Chairman Mark Gaston Pearce (D) said May 15, “We are prepared to move forward” on changes he called “a significant improvement” in board procedures.

Several business groups acknowledged that the board, now consisting of three Democrats and two Republicans, may simply vote again to adopt the rule changes. However, they noted, three of the current members were recess appointed by President Obama in January, and the constitutionality of those appointments is being questioned. The validity of a new board action on the rule changes could be challenged as well, the groups said.

But International Brotherhood of Teamsters President James P. Hoffa said in a statement “the board and the courts must reconsider this issue as soon as possible so that the board can do its job of protecting workers’ rights. Sen. Tom Harkin (D-Iowa), chairman of the Senate Health, Education, Labor and Pensions Committee said, “I am confident that when the courts reconsider this issue they will correct this error.”

Rule Change Held Invalid; Implementation Suspended

Acting in a lawsuit brought by the U.S. Chamber of Commerce and Coalition for a Democratic Workplace, Boasberg said the rule changes required action by a three-member quorum of board members, but he concluded only two members participated in final approval of the rule.

At the time the rules were published in the Federal Register, the board consisted of Pearce and Members Craig Becker (D) and Brian E. Hayes (R). Pearce and Becker favored adoption of the rule changes, which were proposed in June 2011, while Hayes dissented from the rulemaking proposal and later voice his opposition to adoption of the changes.

However, Boasberg concluded, when Pearce and Becker voted on Dec. 16, 2011, to give final approval to the rule changes, Hayes did not vote and was not contacted about his failure to do so. Under the circumstances, Boasberg concluded, Hayes did not participate in the final vote, resulting in an invalid action being taken by less than a quorum.

The court said NLRB must resume processing representation cases under its pre-amendment procedures.

In a statement May 15, NLRB said it has “temporarily suspended” implementation of the regulatory changes, and Acting General Counsel Lafe E. Solomon has withdrawn instructions (Memorandum GC 12-04) he had sent to regional offices (81 DLR AA-1, 4/26/12) on implementing the new rules.

NLRB is reviewing Boasberg’s decision and considering an appropriate response, the board statement said.

NLRB said it has “temporarily suspended” implementation of the regulatory changes, and Acting General Counsel Lafe E. Solomon has withdrawn instructions to regional offices on implementing the new rules.

Business Groups Welcome Ruling

The U.S. Chamber of Commerce commented on Boasberg’s ruling in a blog post prepared by the chamber’s Senior Vice President Randy Johnson and Robin Conrad, executive vice president of the National Chamber Litigation Center.

Johnson and Conrad said the chamber argued that the NLRB proposal was an effort to achieve through rulemaking “a union election scheme that Congress has repeatedly rejected.”

The chamber officials said because of doubts about the constitutionality of the recess appointments of current NLRB Members Sharon Block (D), Terence F. Flynn (R), and Richard F. Griffin (D), it is “not entirely clear” the current board would have authority to issue a new rule. The chamber has intervened in an appellate court proceeding in which the recess appointments are being challenged (51 DLR AA-1, 3/15/12).

Coalition for a Democratic Workplace Chairman Geoffrey Burr commented in a May 15 statement, “Employers are greatly gratified that the Court has overturned a rule that would have been bad for employees and employers.”

“While we hope this will be the final word on this particular attack on workplace democracy, we know that hope is not a strategy and are keeping our eyes out and litigation ready on a number of fronts,” Burr said.

Ronald Meisburg, a former NLRB general counsel who also served as a recess-appointed board member and is now a partner at Proskauer in Washington, D.C., predicted there will indeed be continued litigation over the board’s representation case rules.

Meisburg told BNA May 15 he considers it “very likely” NLRB will appeal the district court’s ruling, and he expects the board’s Democratic majority to continue to press for changes in representation case procedures.

Hoffa, Harkin Criticize Decision, Question Implications

Hoffa was blunt in his criticism of the ruling by Boasberg, who was appointed to the federal bench by President Obama in 2011. The Teamsters leader also suggested that Hayes purposely sat out the final vote to cast doubt on the result he opposed.

“This is just another attack on workers and the American middle class,” Hoffa said. “The decision lets anti-worker extremists game the system. It condones the NLRB member’s neglect of his duty. It gets in the way of the NLRB’s ability to do its job, which is to protect workers’ rights.”

Harkin made a similar point in his statement on the court decision.

“This decision is deeply troubling-it condones and encourages the kind of political gamesmanship at the NLRB that has undermined the rights of all American workers,” Harkin said.

“Member Hayes’s failure to cast a vote on the final rule was perhaps a neglect of his duties, but did not undermine the legitimacy of the Board’s actions. The Board had a quorum, and they acted appropriately,” Harkin argued.

Warning that Boasberg’s decision “seems to suggest that an individual Board member should have veto power over any NLRB decision,” Harkin said “the ruling sets a dangerous precedent for future partisan efforts to undermine the Board and the workers it protects.”