Hot Off the Presses! Court Quashes NLRB's New Election Rule

As reported in earlier Legal Updates, the National Labor Relations Board (NLRB) recently implemented a highly controversial rule intended to expedite representation elections. The new election rule went into effect on April 30, 2012. On May 14, 2012, a federal court in Washington, D.C., found that this rule is invalid because the NLRB enacted it without the required three-member quorum. This decision is a positive development for both employers and employees. Because of the potential for accelerated union representation elections under the new NLRB election rule, it inhibited employees' ability to consider thoughtfully the issue of unionization and limited employers' ability to communicate with employees about the risks and downsides of unionization.

The court's decision came in a case filed by the U.S. Chamber of Commerce and the Coalition for a Democratic Workplace in which they argued that the Board's new election rule was unconstitutional and beyond the Board's authority. However, the Court did not address these arguments. Rather, the court based its decision on the fact that since NLRB member Brian Hayes—at the time the NLRB's only Republican member—objected to the final rule and did not vote on whether to adopt it, the NLRB did not have the authority to issue it. The court found that the NLRB enacted the final rule by circulating it for voting and then forwarding it for publication on the same day, meaning Hayes had no effective way to cast his vote. The Court said that if Hayes had been given time to respond, even if he expressed an intent to abstain or acknowledged receipt of the final rule, he may have counted toward the quorum. But because this did not happen, the NLRB lacked a quorum.

Notably, the Court's decision did not address whether the rule would have been lawful if adopted by a quorum. Rather, it noted that "nothing appears to prevent a properly constituted quorum of the (NLRB) from voting to adopt the rule if it has the desire to do so," but until then, "representation elections will have to continue under the old procedures." 

The NLRB has not released any comment on the Court's rule, but it will most likely appeal.  Additionally, as it did with its notice posting rule, it is possible that the Board will decide to suspend implementation of the new election rule while the appeals court hears the case. Stay tuned, as we will keep you updated on any further developments regarding this rule. In the meantime, if you have questions about how this development affects your business, contact any of Faegre Baker Daniels' labor lawyers.