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Just as it appeared that employers should begin preparing to
post the notice of employee rights in the workplace mandated by a
final rule of the National Labor Relations Board ("NLRB")
to become effective April 30, a federal district judge has found
that rule to be beyond the authority of the NLRB and has found the
rule to be unlawful and unenforceable.1Chamber of
Commerce of the United States et al. v. National Labor Relations
Board et al., Case No. 2:11-cv-02516 (D.S.C. April 13,
2012).
Agency authority is delimited by the powers granted to it by
Congress. As put by U.S. District Judge David C. Norton in his
order last Friday:
Regardless of how serious the problem an administrative agency
seeks to address, ... it may not exercise its authority 'in a
manner that is inconsistent with the administrative structure that
Congress enacted into law.'" FDA v. Brown &
Williamson Tobacco Corp., 529 U.S. 120, 125 (2000) (quoting
ETSI Pipeline Project v. Missouri, 484 U.S. 495, 517
(1988)).
Judge Norton found in the case of the notice-posting rule that
"[t]he notice-posting rule proactively dictates employer
conduct prior to the filing of any petition or charge, and such a
rule is inconsistent with the [NLRB]'s reactive role under the
[National Labor Relations Act ("NLRA")]." While the
Act permits the NLRB to require an employer to post a remedial
notice if found to have violated the NLRA, it found no evidence to
support the NLRB's assertion of authority to require proactive
posting by employers of a notice of employee rights.
The ruling of the federal court in South Carolina comes six
weeks after a federal judge in the District of Columbia reached the
opposite conclusion in refusing to declare the notice-posting
provisions of the same rule to be invalid. In that case,
National Association of Manufacturers et al. v. National Labor
Relations Board et al., Case No. 1:11-cv-01629, District Court
Judge Amy Berman Jackson found:
that the NLRA granted the board broad rulemaking authority to
implement the provisions of the act, and that the board did not
exceed its statutory authority in promulgating Subpart A of the
challenged rule — the notice-posting provision.
That ruling presently is on appeal to the United States Court of
Appeals for the District of Columbia.
Injunction Issued
Just as this Alert was going out, word was received that the
Court of Appeals for the District of Columbia has issued an
emergency stay of the NLRB posting rule citing the existing
uncertainty over enforcement of the rule on April 30. The Court
also observed that the NLRB had postponed the effective date of the
rule during the challenge in the earlier decided National
Association of Manufacturers case in the District of Columbia.
It conceded in that case that a postponement was necessary to give
the district court ample opportunity to consider the arguments
before the rule went into effect. However, the NLRB now had adopted
a contrary position before the DC Circuit in arguing that the
rule's effective date should not be delayed. These
opportunistically contradictory positions worked against the
NLRB's argument.
What Are Employers to Do?
Compliance with the NLRB posting rule is now postponed pending
resolution of the rule's enforceability.
Footnote
1. Specifically, the court ruled that the rule violates
the Administrative Procedure Act ("APA"), 5 U.S.C.
§706. The APA subjects final agency action to judicial review
to determine whether, inter alia, it is "in excess of
statutory jurisdiction, authority, or limitations" granted to
an administrative agency such as the NLRB. 5 U.S.C.
§706(2)(C)
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