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Circuit Court Prohibits NLRB From Enforcing Rights Notice Posting Rule Pending Appeal

Monday, April 23, 2012

By Lawrence E. Dubé  

The U.S. Court of Appeals for the District of Columbia Circuit April 17 enjoined the National Labor Relations Board from enforcing a regulation that would have required most private sector employers in the United States to post a notice of employee labor law rights beginning April 30 (Nat'l Ass'n of Mfrs. v. NLRB, D.C. Cir., No. 12-5068, injunction pending appeal 4/17/12).

In response, NLRB announced its regional offices will not implement the disputed rule, but the agency will defend the rule in the D.C. Circuit and plans to appeal an adverse ruling that was issued April 13 by the U.S. District Court for the District of South Carolina.

“We continue to believe that requiring employers to post this notice is well within the Board's authority, and that it provides a genuine service to employees who may not otherwise know their rights under our law,” Chairman Mark Gaston Pearce said in a statement released by NLRB.

Rule Covers Employers Under NLRB Jurisdiction.

The notice-posting rule would apply to any employer covered by the National Labor Relations Act, excluding states or political subdivisions not subject to board jurisdiction.

The board has estimated that the “great majority” of 6 million small businesses in the United States would be required to comply with the regulation by posting a notice of NLRA rights. The regulation also requires employers that customarily communicate with employees on internet or intranet sites to post the NLRB notice electronically.

A divided NLRB proposed the regulation in December 2010 (28 HRR 1382, 12/27/10) and published a final rule in August 2011 (76 Fed. Reg. 54,006; 29 HRR 932, 9/5/11).

The rule originally was set by NLRB to become effective in November 2011. The agency postponed the effective date to Jan. 31, 2012, and then extended the date to April 30, after Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia expressed concern that she did not have enough time to determine the rule's legality before its original scheduled effective date.

Federal District Court in D.C. Ruled in March.

In the first of two district court rulings on the NLRB rule, Jackson rejected most of the National Association of Manufacturers' challenge to the NLRB regulation (Nat'l Ass'n of Mfrs. v. NLRB, 2012 BL 58223, 192 LRRM 2999 (D.D.C. 2012); 30 HRR 259, 3/12/12).

Jackson generally upheld the rule against challenges brought by NAM, the National Right to Work Legal Defense and Education Fund Inc., the Coalition for a Democratic Workplace, the National Federation of Independent Business, and several small businesses.

Finding that the NLRA gives the board a “broad, express grant of rulemaking authority,” Jackson rejected claims that the board's decision to require the posting was arbitrary and capricious.

But Jackson found that two portions of the rule could not be enforced by NLRB.

She concluded that the board exceeded its statutory authority in promulgating a provision that would treat any failure to post the required notice as an unfair labor practice under the act. Jackson also held that a provision tolling the NLRA's statute of limitations in any case at a job site where an employer failed to post the mandated notice was inconsistent with the language of the statute.

Challengers Obtain, Temporary Halt.

NAM and the other plaintiffs in the lawsuit asked Jackson to block enforcement of the NLRB rule while they pursued an appeal to the D.C. Circuit, but she denied the request.

The groups then filed their appeal as well as an emergency motion asking the appeals court to enjoin the board from enforcing the rule pending resolution of the appeal (30 HRR 291, 3/19/12).

NLRB opposed a delay in enforcement of the regulation, arguing that the groups did not show they will prevail in the D.C. Circuit or that any irreparable harm would result if the rule went into effect as scheduled and was later struck down by the appellate court.

But Judges David S. Tatel, Janice Rogers Brown, and Brett M. Kavanaugh said that “uncertainty” about enforcement of the rule “counsels further in favor of temporarily preserving the status quo while this court resolves all of the issues on the merits.”

The D.C. Circuit cited the ruling by the District of South Carolina, as well as recent board action postponing implementation of the rule.

The D.C. Circuit enjoined NLRB from implementing the regulation pending appeal, and ordered an expedited briefing schedule, beginning with a May 15 due date for the filing of briefs challenging the NLRB rule. The court directed the clerk of court to schedule an oral argument in September.

NLRB Will Appeal South Carolina Ruling.

In the lawsuit filed by the U.S. Chamber of Commerce and the South Carolina Chamber of Commerce, Judge David C. Norton said “the NLRA does not require employers to post general notices of employee rights under the Act” (Chamber of Commerce v. NLRB, D.S.C., No. 11-cv-2516).

“[T]he court finds that Congress did not intend to impose a notice-posting obligation on employers, nor did it explicitly or implicitly delegate authority to the Board to regulate employers in this manner,” Norton wrote.

NLRB said it disagrees with the ruling in Chamber of Commerce v. NLRB and will file an appeal.

By Lawrence E. Dubé  


Text of the D.C. Circuit order is available at http://op.bna.com/dlrcases.nsf/r?Open=ldue-8tfmq8.

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