Originally published June 17, 2010
Keywords: National Labor Relations Act, agency jurisdiction, NLRA, Supreme Court
Today the Supreme Court issued one decision, described below, of interest to the business community.
National Labor Relations Act—Agency Jurisdiction
New Process Steel, L.P. v. NLRB, No. 08-1457 (previously discussed in the November 2, 2009, Docket Report ).
The National Labor Relations Act (NLRA) grants enforcement authority to a five-member National Labor Relations Board (Board) and provides that "three members of the Board shall, at all times, constitute a quorum of the Board." 29 U.S.C. § 153(b). The NLRA also allows the Board to delegate some or all of its authority to a three-member panel and provides that "two members shall constitute a quorum of any [such] group." Id. Effective as of December 28, 2007, the Board delegated its powers to three members, one of whom was a recess appointee. That appointment expired on December 31, 2007. Between January 1, 2008 and March 27, 2010, the Board had only two sitting members, and it decided nearly 600 cases during that period.
Rejecting the government's position that the two members satisfied the quorum requirement, the Supreme Court held today in New Process Steel, L.P. v. NLRB, No. 08-1457, that the Board must have at least three sitting members to exercise its authority. The Court's five-to-four decision, which reflects a rarely seen alignment of Justices, calls into question the validity of the hundreds of decisions issued by the Board during the 27-month period at issue.
The majority opinion was written by Justice Stevens and joined by Chief Justice Roberts and Justices Scalia, Thomas, and Alito. The majority explained that only its interpretation gives meaningful effect to all the NLRA's provisions, requiring that the Board have a three-member quorum "at all times" while allowing panels to act with only two members when a third member is disqualified from a particular case. The Court also reasoned that Congress could have employed more straightforward language if it had intended to allow the Board to act on an ongoing basis with only two members and that the Court's interpretation is consistent with the Board's longstanding practice.
The dissenting opinion was written by Justice Kennedy and joined by Justices Ginsburg, Breyer, and Sotomayor. In the dissenting Justices' view, the NLRA's overarching purpose of ensuring orderly operation of the Board and efficient resolution of labor disputes is better served by an interpretation that allows the Board to operate with only two members. While agreeing that it "is not optimal for a two-member quorum to exercise the full powers of the Board for an extended period," slip op. 13 (Kennedy, J., dissenting), the dissenters believed that Congress would have preferred this outcome to leaving the Board defunct.
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