It’s not often that a District Court Judge opens an opinion with a quote from Woody Allen, but given all the NLRB has gone through in the past months, it seemed fitting. On May 14th, Judge James Boasberg invalidated the NLRB’s rule which proposed to change the process of union elections in the workplace. The rule would have expedited these elections (typically about 38 days from start to finish), giving employers less time to “educate” employees on the benefits of not forming a union. This is a continuation of a seemingly endless stream of developments involving the NLRB, including a recent decision by the Court of Appeals for the District of Columbia to postpone a rule requiring employers to post a notice of employees’ rights.
While the NLRB’s posting rule will have its day in court (oral arguments are scheduled for sometime in September of this year), the ruling in Chamber of Commerce v. NLRB captured the attention of many employment lawyers in the LexBlog Network. The case sprung from a dispute over the manner in which the NLRB passed the “quickie” or “ambush” election rule. The parties responsible for bringing the suit alleged the rule itself was invalid, but the decision to nullify was based solely on the voting procedures used by the NLRB.
One of the best posts on the Network belonged to Brennan Bolt, an attorney with McKenna Long & Aldridge and contributor to Labor Relations Today. Mr. Bolt’s post focused on the events leading up to vote:
“It started on June 22, 2011, when the Board formally proposed to amend its procedures for resolving disputes about union representation in a Notice of Proposed Rulemaking (NPRM), which was issued by a 3-1 vote of the four members holding office at the time. The NLRB received 65,000 written comments in response, and the Board held two full days of hearing on the proposed rule. Again, all four members at the time participated in the hearing. So far so good. Subsequently, then-Chairman Liebman’s term expired leaving three members, current Chairman Pearce, Member Becker, and Member Hayes.”
The rule underwent further drafting sessions, and was circulated through the Board’s “Judicial Case Management System (JCMS).” According to Mr. Bolt the board then “rushed the vote and publication for the final version just hours after it was circulated.”
However, as Tyler Hendry, a lawyer with Bond Schoeneck & King, pointed out on the firm’s New York Labor & Employment Law Report, Member Brian Hayes, the lone conservative vote on the Board, never voted on the final rule. While Hayes voted on the preliminary version, he never voiced an opinion as the rule was passed. Judge Boasberg’s ruling hinged upon this fact:
“Judge Boasberg further reasoned that Member Hayes could not be counted toward a quorum particularly because no one on the Board reached out to him to ask for a response, as is the agency’s usual practice where a member has failed to vote. Judge Boasberg stated that if Hayes had affirmatively expressed his intent to abstain or acknowledged receiving notification that the final rule had been circulated, he may have been counted in the quorum; however, because none of those things happened, Judge Boasberg found that Member Hayes failed to “show up — in any literal or even metaphoric sense.” Because the Board failed to meet the quorum requirement, Judge Boasberg refused to address the plaintiffs’ challenge to the final rule on various procedural and substantive grounds.”
One interesting “takeaway” from the decision in this case is that the ruling casts a shadow over the impending litigation of President Obama’s recess appointments. Seth Borden, a partner in McKenna Long & Aldridge‘s New York offices and blogging “teammate” of Brennan Bolt on Labor Relations Today, discussed this as he was wrapping up his recap of the ruling:
“This decision foreshadows the coming showdown over President Obama’s January 2012 “recess” appointments. Judge Boasberg’s decision strongly suggests that if there is an interest in a fully functional National Labor Relations Board, there must be a fully seated Board — or at least a full quorum of three like-minded Members who will participate in actions.”
Mr. Borden also noted that although the ambush election rule has been shot down, it certainly does not mean the Board won’t revisit the matter at a later date:
“Finally, it is unclear whether the decision truly opens the door to allow an obstinate Member to derail the Board by perpetually ignoring Board overtures to act. On the facts of this case, the Judge simply found there was no quorum.”
In fact, Judge Boasberg explicitly stated that while the rule could not stand, it was due to the lack of a quorum, not because the rule itself was unlawful or unconstitutional. With more on what the NLRB may or may not do as a result of this verdict, Hunton & Williams offers up their thoughts on the Hunton Employment & Labor Perspectives blog:
“With a full panel of five Members, three of whom are Democrats, the Board may well revisit its “quickie election” rule and pass it again, even if both Republican members refuse to vote. While the employer community likely would challenge that action on the grounds that at least three of the current Board members were not properly appointed, the rule is far from dead yet. Moreover, many of the Acting General Counsel’s new election guidelines, which he detailed in a May 2012 memorandum to the Board’s Regional Directors, do not necessarily depend upon the validity of the rule itself. Thus, if the Board is inclined to speed up the union election process, it can probably do so even without the rule. Accordingly, employers that have begun preparing for a new world of “quickie” union elections should not alter or abandon that preparation.”
With so much coverage on LXBN regarding this latest bit of news, finding the best posts was a little like finding a handful of needles in a haystack. That said, some of the coverage clearly stood out. In particular, one of the best posts came from Leland Beck on the Federal Regulations Advisor. Here’s Mr. Beck’s parting shots on the quickie election rule:
“This blog expected this decision sooner – the rule took effect on April 30, 2012. Any NLRB acts taken under the rule (or otherwise) in the past two weeks on only two affirmative votes and nothing more violate the quorum requirements. The NLRB must vacate any such acts unless the same actions could have been taken under the previous rules.
The NLRB again overstepped the boundaries of authority it was granted. It is axiomatic that an administrative body can not act beyond its authority, whether assuming jurisdiction that it has not been granted, or acting in a way that has not been permitted. That violation of fundamental APA requirements clearly illustrates that the NLRB needs to learn administrative law.”
As I mentioned at the onset of this post, Judge James Boasberg opened his decision with a quote from Woody Allen. In this case, that quote, “Eighty percent of success is showing up,” could be taken even further. Judge Boasberg’s ruling alluded to the fact that had the other Board members or their staff made any sort of effort to involve Member Hays in the voting, the outcome of the case may have been different. At certain points, you can almost sense Boasberg’s (an Obama appointee) frustration at having to hand down this verdict:
“At the end of the day, while the Court’s decision may seem unduly technical, the quorum requirement, as the Supreme Court has made clear, is no trifle. Regardless of whether the final rule otherwise complies with the Constitution and the governing statute – let alone whether the amendments it contains are desirable from a policy perspective – the Board lacked the authority to issue it, and, therefore, it cannot stand.”
Fortunately or otherwise, as the attorneys at Hunton & Williams mentioned, the NLRB may not have to resort to crafting an identical rule in order to see the union election process sped up. Although you can bet the farm that employers won’t take those changes lying down.
For more coverage on the NLRB’s election rule, check out all LXBN has to offer on the subject.