By: Daniel Finerty

After President Obama’s re-election, many employers assumed they would be faced with an aggressive and re-invigorated National Labor Relations Board (“Board”). However, last Friday’s decision from the District of Columbia Court of Appeals may slow the Board, at least in the short term. Noel Canning Div. of Noel Corp. v. National Labor Relations Board, App. No. 12-1115 and 12-1153 (D.C. Cir.) (Jan. 25, 2013).

In Noel Canning, the court ruled that the Board did not have a valid quorum to issue a February 8, 2012 decision finding that the Company committed unfair labor practices. As you may recall from the Supreme Court’s decision in the New Process Steel case, for the Board to have a valid quorum, it must have at least three members. If the Board does not have a quorum in order to lawfully take action, any action it takes is void; in addition, a lack of quorum precludes the Board from adopting any new regulations.

The Noel Canning court’s ruling that the Board did not have a valid quorum was based on its review of the President’s January 4, 2012 “recess appointments” of three new Board members, Sharon Block, Terrence F. Flynn and Richard F. Griffin. The U.S. Constitution provides that “[t]he President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.”

The court ruled that, on January 4, 2012, the Senate was not in recess. Rather, the Senate was operating pursuant to a unanimous consent agreement, which provided for pro forma sessions every three business days from December 20, 2011 through January 23, 2012. Further, the three appointments to the Board on January 4, 2012 were made after the start of the 112th Congress on January 3, 2012. The second session of the 112th Congress continued the following day when the President attempted to make the recess appointments.

Because the Senate was not in recess, the court determined that the President’s three January 4, 2012 recess appointments to the Board were invalid from their inception. “Because the Board lacked a quorum of three members when it issued its decision in this case on February 8, 2012, its decision must be vacated.” Noel Canning, slip op. at 30.

The court’s decision could void all Board decisions and actions going back to January 4, 2012. The Board is arguing against this result. Board Chairman Pearce has stated the Board’s position that the Noel Canning decision applies only and noted that the Board will continue to perform its statutory duties and issue decisions. An appeal of the Noel Canning decision to the Supreme Court appears likely. The Supreme Court will likely be asked to decide if the Noel Canning ruling is correct and, if so, what the decision means in terms of Board decisions taken in the past year.

If you have questions about the Board, social media or any other issue, feel free to call Daniel Finerty at 414-226-4807, or any other Lindner & Marsack attorney at 414-273-3910.