The National Labor Relations Board (NLRB) has suffered a series of setbacks recently at the hands of federal judges. In December, the Fifth Circuit Court of Appeals largely struck down the NLRB’s prohibition on class action waivers in arbitration agreements. Now, on January 6, 2014, the NLRB announced that it won’t seek Supreme Court review of two U.S. Court of Appeals decisions invalidating its Notice Posting Rule, which would have required most private sector employers to post a notice informing employees of their right to organize. The deadline for seeking Supreme Court review passed January 2.
The legal effect of this “non-event” is that it allows to stand two appellate court decisions that invalidated NLRB’s 2011 adoption of a rule. In May 2013, the U.S. Court of Appeals for the District of Columbia Circuit held in National Ass’n of Manufacturers v. NLRB, 717 F.3d 947 (D.C. Cir. 2013) that requiring employers to post the statement of rights under the National Labor Relations Act (NLRA) would be inconsistent with Section 8(c) of the act, which essentially gives employers the right to speak freely to their employees so long as the communications aren’t coercive. The Court also held that NLRB lacked authority to promulgate the regulation, because it would have effectively modified the federal statutory time limit for filing unfair labor practice charges. A month later, the Fourth Circuit ruled against the NLRB and sustained a second challenge to the regulation in Chamber of Commerce v. NLRB, 721 F.3d 152 (4th Cir. 2013).
Had the rule gone into effect, the impact on employers who failed to post the notice could have been severe. While the NLRB doesn’t audit employers and can’t assess fines or penalties, the consequences of not posting the notice could have included: (1) extending the time limit for employees and unions to file charges with the NLRB, and (2) a presumption that the failure to post the notice constituted "evidence of unlawful motive” in an unfair labor practice case involving other, unrelated alleged violations of the NLRA.
The More Things Change…
Technically, the notice rule is invalid only in the D.C. Circuit and the 4th Circuit, although it is difficult to imagine that NLRB will actively seek to enforce the rule elsewhere in the country given its defeats in those jurisdictions. But the NLRB could still choose to pursue the rule, possibly even in a different form, sometime in the future.
It is also important to note that the NLRB’s decision to abandon its current litigation involving the enforceability of its posting rule does not change other areas of federal labor law. These include employees’ substantive rights to organize, or prohibitions against actions by employers that “chill” employee rights to engage in concerted, protected activity. These include the right to:
- Organize a union to negotiate with employers concerning wages, hours, and other terms and conditions of employment.
- Form, join or assist a union.
- Bargain collectively through representatives of employees’ own choosing for a contract setting wages, benefits, hours, and other working conditions.
- Discuss terms and conditions of employment or union organizing with co-workers or a union.
- Join with one or more co-workers to improve wages, benefits and other working conditions.
- Choose not to do any of these activities, including joining or remaining a member of a union.
The invalidation of the NLRB Notice posting rule also does not affect other posting rules, such as the one issued by the Department of Labor’s (DOL) Office of Federal Contract Compliance Programs (OFCCP). That rule requires federal contractors to post workplace notices informing workers of their rights under the NLRA, although this rule is being challenged as well: on December 8, 2013, the National Association of Manufacturers filed a complaint with the trial court for the District of Columbia. That lawsuit seeks declaratory, injunctive and other relief, alleging violations of the First Amendment’s guarantee or the right to speak (and not to speak), challenging the OFCCP’s authority to promulgate such a rule, and on the same grounds as the D.C. Court of Appeals invalidated the NLRB’s notice posting rule. National Association of Manufacturers v. Perez, D.D.C., No. 13-cv-1998, complaint filed 12/18/13.
Stay tuned for further developments on this front right here at Stoel Rives World of Employment.