Supreme Court Ruling on NLRB Appointments Invalidates Bias Decisions against Businesses

Yesterday’s unanimous U.S. Supreme Court decision in the Noel Canning case is a big win for employers, who have been the targets of a series of rulings by the pro-labor National Labor Relations Board (NLRB) since 2009. It invalidates the appointments made by President Obama during a Senate recess in 2012, a tactic used by presidents to push through appointments (often called “recess appointments”) in the absence of the upper chamber. These appointments made hundreds of decisions affecting employers across country, often to the detriment of employers.

Essentially, the root of the case is that the NLRB board is tasked with determining the validity of unfair labor practice charges brought by both employers and workers, an important duty that affects employers and employees. However, since late 2007 the NLRB board has not had five confirmed members, which has not led to the 3-person quorum required for the board. However, this two-person board has gone on to deliver over 500 decisions.

Under President Obama, the board has rendered many unfair decisions that hurt employers and ignore reason, including:

  • In Miklin Enterprises, Inc. the board forced Jimmy John’s to rehire workers who said eating the food there could make people sick. The board said such comments were not disparaging because the workers were protesting the company’s sick leave policy.
  • In Plaza Auto Center the board deemed an employee’s firing unlawful despite the fact that he cursed at his supervisors in a meeting simply because the subject of the meeting was related to working conditions at the company.
  • In Fresenius USA Manufacturing the board said it was okay for an employee to lie to his employer during workplace investigations if the questions pertained to the employee’s actions during a union dispute.

It is clear to the business community that the Supreme Court ruled fairly, stating that the Senate was not in a recess and that the installation of the 3 members of the board appointed by the Obama administration usurped the ability of the Senate to review appointments. In sum, the NLRB must revisit the decisions made by the invalid appointees and is, as the U.S. Chamber called it, “a victory for the rule of law.” The U.S. Chamber helped bring the case on behalf of its member company, Noel Canning.