NLRB Recess Appointment Challenge Likely Headed to Supreme Court

This week, the Obama administration stated it would petition the Supreme Court to review the recent U.S. Court of Appeals for the D.C. Circuit decision, Noel Canning v. NLRB, a key case (of several separate cases) challenging the validity of three “recess appointments” President Obama made to the National Labor Relations Board in January 2012.   The D.C. court ruled that the appointments were “constitutionally invalid” because the Senate was actually not in recess when the appointments were made.  Accordingly, the five-member Board lacked a quorum when it decided the underlying legal issues affecting employer Noel Canning.    Immediately after the Jan. 25 court decision, NLRB Chairman Marc Pearce responded to the ruling by issuing a statement asserting his belief that the appointments will ultimately be upheld and reporting that, in the meantime, the Board will continue to issue decisions.  President Obama followed shortly thereafter by re-nominating Sharon Block and Richard Griffin to the NLRB; the third original recess appointee Terence Flynn resigned last year over an unrelated ethics inquiry.   The ongoing legal challenge will test President Obama’s executive power and a Supreme Court ruling could have significant implications, calling into question the validity of all decisions made by the Board in the past year, as well as the validity of the appointment of Richard Cordray to the Consumer Financial Protection Bureau, which was made under the same circumstances as the Board appointments. AGC, with the help of AGC-supported Coalition for a Democratic Workplace (CDW) and the U.S. Chamber of Commerce, were instrumental in the D.C. Circuit decision and continue to evaluate the legal strategy moving forward.  In addition, legislation has been introduced in the U.S. House, H .R. 1120 – the Preventing Greater Uncertainty in Labor-Management Relations Act – which would prohibit the Board from taking any action that requires a quorum until the Senate confirms members or the Supreme Court makes a decision on the constitutionality of the appointments. If you have any questions, please contact Jim Young at youngj@agc.org or (202) 547-0133.