Appeals Court Says NLRB Lacked Authority to Mandate Workplace Poster

A federal appeals court in Washington, D.C. has ruled the National Labor Relations Board (NLRB) exceeded its authority in attempting to require all employers, unionized and non-union alike, to display a workplace labor law poster informing workers of their rights under the National Labor Relations Act (NLRA). The controversial, long-delayed rule, which the agency issued in August 2011, would have set penalties for employers who failed to display the new poster. Several legal challenges have blocked the poster mandate from taking effect.

In May, the District of Columbia Court of Appeals ruled the NLRB exceeded its authority under the NLRA, by denying employers the ability to post accurate information about labor law, unless it threatens force or reprisals, or promises benefits, in an attempt to sway workers away from unions. Employer groups have criticized the wording of the NLRB's poster as one-sided in favor of unions.

While the appellate court decision in the case of National Association of Manufacturers v. NLRB delivers the agency's poster mandate at least a temporary setback, it may not be the final word. Another federal appeals court, in Richmond, Virginia, is considering the same issue in another case, filed by the Chamber of Commerce of the United States. A lower federal court has already ruled against the NLRB, rejecting arguments the NLRA's design, language, or legislative history justified issuing a general rule for employers beyond the NLRB's basic duties of supervising workplace elections on union representation and providing remedies for unfair labor practices.

The NLRB is expected to request the Supreme Court to overturn the unfavorable lower court rulings; the high court would likely take the NLRB's appeal. Although it is not considered likely, Congress could also decide to step in with legislation to resolve the dispute. But until further notice, the NLRB rule to mandate workplace labor law compliance posters on unionization rights remains frozen by court order.

Under the Obama administration, the five-member NLRB has been a hotbed of activity and the center of controversy. Business representatives complain that the agency has reversed a host of previous policies and positions in order to adopt aggressively pro-union stands.

The NLRA poster rule also became caught up in a farther-reaching controversy over the legality of President Obama's appointments, without Senate approval, of three members of the five-member NLRB. Late in 2011, when a member's resignation opened up a third vacancy, the NLRB lost the quorum it needed to conduct business. The administration claimed the replacements were valid under the president's constitutional power to make short-tern "recess" appointments when Congress is out of session.

But the same DC appeals court that invalidated the NLRA poster rule decided the recess appointments were invalid, because they came after the new Congress had begun at the start of 2012, and the vacancies had not occurred while Congress was between sessions. More recently, one more federal appeals court, this one in Philadelphia, has ruled an even earlier NLRB member "recess" appointment was also invalid. If these cases stand, many agency decisions and actions over several years could be undone.

Although it is not considered likely, Congress could also decide to step in with legislation to resolve the dispute. But until further notice, the NLRB rule to mandate workplace labor law compliance posters on unionization rights remains frozen by court order.