NLRB By: Samuel Sverdlov, Esq.

Seyfarth Synopsis: President Trump has nominated a candidate for the final remaining vacancy on the five-member National Labor Relations Board, who, if confirmed, would give the Republicans a 3-2 majority on the NLRB.

Five months after his inauguration, President Donald Trump has finally nominated a candidate for the remaining vacancy on the five-member National Labor Relations Board. The nominee, William Emanuel, is a management-side labor attorney with decades of labor and employment experience. President Trump’s nomination comes just days after the President nominated another Republican lawyer, Marvin Kaplan, to the other vacancy on the NLRB. Currently, the Democrats enjoy a 2-1 majority on the NLRB. However, if confirmed, Emanuel and Kaplan would join fellow Republican, Philip Miscimarra, in a 3-2 majority for Republicans on the NLRB.

President Trump’s recent nominations should give hope to private-sector employers. The business community has roundly criticized the Obama Board for a number of rulings that they argued overreached the Board’s authority, resulting in unreasonably pro-union decisions. With a Republican majority, the NLRB is poised to take a more employer-friendly approach. This is especially critical for employers as the Board may see fit to evaluate high-profile issues such as graduate student employment status, “micro-unit” issues, and “joint employer” relationships.

Emanuel’s nomination would be for a five-year term set to expire on August 27, 2021. At present, no confirmation hearing dates have been made public, and it is unclear whether the candidates will be confirmed before the August recess. As always, we will continue to update you with more information as it becomes available.

By: Jaclyn W. Hamlin, Esq.

Seyfarth Synopsis: A review and analysis of select NLRB cases decided by President Trump’s new appointee as Secretary of Labor and former NLRB Member Alexander Acosta.

With the withdrawal of Andrew Puzder from consideration for the Secretary of Labor vacancy on President Donald Trump’s cabinet, former NLRB Member Alexander Acosta has emerged as the candidate for the role. If confirmed, Mr. Acosta will become the first Hispanic member of the Trump Cabinet.  While his confirmation has not yet been accomplished, and it is impossible to predict precisely the direction the Department of Labor will take if and when Mr. Acosta assumes the mantle of leadership, reviewing some of his words from his time as an NLRB Member is an interesting exercise, and may provide a few clues about his priorities and possible goals.  One thing that stands out in the opinions is his desire to follow precedent and established law, even where it results in an outcome that he may not support philosophically.

Mr. Acosta was appointed to the NLRB by President George W. Bush, and served his tenure in 2002 and 2003, as a member of the Majority. Nonetheless, Mr. Acosta occasionally availed himself of concurring or dissenting opinions to highlight his views on particular issues.  Below, we review just a few.

Alexandria Clinic, P.A., 339 NLRB No. 162 (2003) – In a concurring opinion, Mr. Acosta agreed with his majority colleagues that the employer did not violate the NLRA when it discharged several employees for participating in a strike without giving the requisite notice under Section 8(g) of the Act.  Mr. Acosta explained his view that the statutory language was clear and that “because the statutory language is unambiguous, we cannot depart from it.”  Mr. Acosta further warned against the dangers of ignoring the plain language of the statute – from increased litigation to uncertainty for employers.

Double D Construction Group, Inc., 339 NLRB No. 48 (2003) – Concurring with his majority colleagues, Mr. Acosta expressed a strong view on the rights of undocumented immigrant workers.  Mr. Acosta explained that the Administrative Law Judge discredited an employee’s testimony because he had used a false Social Security number to apply for work, and concluded from that act that the employee might offer false testimony.  Mr. Acosta firmly rejected this view, explaining that undocumented workers are statutory employees entitled to the protections of the NLRA.  He stated that a blanket policy of discrediting any “once-undocumented worker, who to obtain work provides a false social security number,” was inconsistent with the Act and that “such an automatic sanction makes it exceedingly difficulty for the General Counsel to establish an unlawful discharge or other unfair labor practice directed against an undocumented worker.”  While Mr. Acosta acknowledged that providing a false social security number is relevant to a credibility determination, he warned that the NLRB’s “continued commitment to prosecuting unfair labor practices directed against undocumented workers requires an understanding of the workplace and life realities faced by these individuals.”

Comcast Cablevision-Taylor, 338 NLRB No. 166 (2003) – Concurring in a decision related to a representation case, Mr. Acosta used his platform to highlight “potential inconsistencies in Board case law.”  Mr. Acosta expressed concern that the Sixth Circuit had used a Board holding in a previous case to rule on enforcement issues, but that the Board had not considered whether the case itself, or some other related inconsistent precedent, remained good law.  Mr. Acosta encouraged the Board to reconcile its precedent so as to avoid inconsistent results.

While Mr. Acosta’s confirmation is not yet accomplished, Republicans and Democrats alike have characterized him as a longtime public servant with experience enforcing labor laws. This small sampling of his concurrences indicates that he values logical decision-making based on the plain language of the law, where appropriate, and that he considers the consistency of precedent to be of importance.  His concurring opinion in Double D Construction reveals that he considers the government as having a role in protecting the rights of undocumented workers.  If confirmed as Secretary of Labor, Mr. Acosta will – of course – not be responsible for enforcing the NLRA.  His concurrences as a Member of the NLRB, however, provide interesting insights into the Department of Labor he may soon run.

NLRB 2By: Marjorie C. Soto, Esq., Jeffrey A. Berman, Esq., and Mary Kay Klimesh, Esq.

Seyfarth Synopsis: Congressional Committee Head Virginia Foxx (R-NC) and Subcommittee Chair Tim Walberg (R-MI) ask NLRB General Counsel Griffin to either immediately rescind his January 31 report regarding the purported rights of faculty, students and scholarship athletes, or “step aside as general counsel.”

Yesterday, we reported that Richard F. Griffith, Jr., the General Counsel of the National Labor Relations Board, issued a report titled “General Counsel’s Report on the Statutory Rights of University Faculty and Students in the Unfair Labor Practice Context.” A copy of  yesterday’s Management Alert can be found here.

It did not take long for Griffin’s Report to catch the attention of Congress. Yesterday, Representative Virginia Foxx (R-NC), Chairwoman of the House Committee on Education and the Workforce, and Representative Tim Walberg (R-MI), Chairman of the House Subcommittee on Health, Employment, Labor, and Pensions, jointly issued a response to the Report, calling for Griffin to “rescind his memorandum immediately” or  “step aside as general counsel.”   In support of their request, the Representatives jointly stated that the “memorandum puts the interests of union leaders over America’s students, and it has the potential to create significant confusion at college campuses across the nation.”

Even if Griffin refuses to withdraw the Report, it reasonably can be anticipated that the General Counsel appointed by President Trump at the conclusion of Griffin’s appointment in November, or the soon-to-be Trump appointed Board majority, will revisit not only the Report but also the underlying decisions in Pacific Lutheran, Columbia and Northwestern.

NLRB 2On Thursday, January 26, 2017, the NLRB announced that President Trump named Board Member Philip A. Miscimarra to serve as Acting Chairman of the NLRB.  Miscimarra will replace former Chairman Mark Gaston Pearce, who will continue as a Board Member.  Pearce’s term expires on August 27, 2018.  Acting Chairman Miscimarra’s current term expires on December 16, 2017.

The Board currently has three members: Board Member Lauren McFerran being the third member.  Her term expires on December 16, 2019. Two Board Member seats are currently vacant.  President Trump gets to nominate these two members.  The two nominees must then be confirmed by the Senate.

Prior to the Board, Acting Chairman Miscimarra practiced labor and employment law as a partner with Morgan Lewis & Bockius LLP.   Prior to Morgan Lewis, Miscimarra was a partner at Seyfarth Shaw LLP.

 

By:  John J. Toner, Esq.

The Supreme Court today issued its much anticipated decision in NLRB v. Noel Canning, regarding the President’s authority to avoid the Senate’s confirmation procedure by granting recess appointments to fill  vacant positions. The decision specifically involved the legitimacy of the President’s recess appointment of Terence Flynn, Sharon Block, and Richard Griffin to be Members of the National Labor Relations Board. A unanimous Court found that those appointments were beyond the President’s authority and, therefore, unconstitutional.

As a result of the Court’s decision, NLRB decisions in which Block, Griffin, or Flynn participated will most likely be invalidated and will need to be reconsidered by the current Board, which already has a considerable backlog of pending cases and is devoting substantial efforts to issue the “quickie” election regulations. Among the decisions that the NLRB will have to revisit are those involving highly controversial issues such an employer’s ability to issue reasonable rules regarding employee behavior at work or to limit access to its facilities by off-duty employees; an employer’s obligation to continue dues deduction after expiration of the collective bargaining agreement; the duty to bargain discipline during first contract negotiations; confidentiality instructions to employees during employer investigations; and an employer’s obligation to provide a union with documents previously considered confidential.

In addition to the case decisions that now may be invalidated, any administrative actions in which Block, Flynn, or Griffin participated may also be invalid — including the appointments of Regional Directors and Administrative Law Judges. As a result, many decisions issued by these Regional Directors or Administrative Law Judges also may be invalid.

The total fallout from this important decision will not be known for some time and we will continue to monitor and advise you of recent developments. To be sure, however, no matter how extensive the repercussions ultimately extend, the decision is a tremendous victory for employers.

By: Anne D. Harris, Esq.

The U.S. Court of Appeals for the Second Circuit recently affirmed a district court’s grant of a temporary injunction brought by the NLRB under Section 10(j) of the National Labor Relations Act to prevent an operator of a group of long-term elder care facilities from engaging in alleged unfair labor practices.  See Kreisberg v. HealthBridge Mgmt. LLC, Case No. 12-4890 (Oct. 15, 2013). Notably, the Second Circuit declined to address the constitutional issue regarding President Obama’s recess appointments to the NLRB (that we have blogged about here and here) noting that when “a case may be resolved on other grounds, courts may decline to reach a constitutional question to avoid deciding constitutional issues needlessly.” Instead, the Second Circuit relied on authority granted to the Board’s General Counsel over a decade ago and concluded that the acting General Counsel’s delegation of authority to authorize such petitions remained intact regardless of the validity of the Board’s appointments. 

HealthBridge and the union representing its workers engaged in contentious  negotiations for a new collective bargaining agreement. Negotiations remained unsuccessful during the year-and-a-half of bargaining and resulted in a lockout of employees followed by a strike declared by the union. During this time period, HealthBridge implemented changes to employee wages, hours, and working conditions. The union filed unfair labor practice charges and the Acting General Counsel of the NLRB authorized a petition for injunctive relief under Section 10(j) of the Act, asking the federal district court to prevent HealthBridge from implementing the terms of its final contract offer pending resolution of unfair labor practice allegations. The district court granted the 10(j) petition finding reasonable cause to support the Board’s allegations that HealthBridge engaged in unfair labor practices. 

The Second Circuit rejected Healthbridge’s argument on appeal that the Board lacked a quorum to authorize a Section 10(j) petition based on two prior delegations of authority to the Board’s General Counsel in 2001 and 2002. Although HealthBridge argued that a 2011 delegation of authority was invalid based on the lack of a quorum, the Second Circuit emphasized that the 2002 delegation confirmed that existing delegations of authority remained in effect and delegated additional authority not included in the 2001 delegation. As such, these delegations of authority had no expiration date and were in effect regardless of the validity of the 2011 delegation. Additionally, the panel rejected the contention that a loss of quorum negated the grant of authority and held that it now “join[s] those of our sister Circuits that have concluded that the delegation of § 10(j) authority to the General Counsel at issue survives even when the Board subsequently lacks quorum.” 

The Second Circuit also shot down Healthbridge’s argument that the U.S. Supreme Court’s 2008 decision in Winter v. Natural Resources Defense Council, 555 U.S. 7, changed the standard for issuing a Section 10(j) injunction under the Act. The Court of Appeals concluded that Winter addressed the standard for preliminary injunctions in general, but did not address or alter the standard for issuing Section 10(j) injunctions.

This case underscores another court’s willingness to reach back to authority delegated by the Board more than a decade ago and find it to remain in effect and applicable despite the lack of a Board quorum and despite Noel Canning. Until the Supreme Court rules on the constitutional arguments raised in Noel Canning, such defenses should be carefully analyzed to determine whether the Board has acted on retained authority regardless of the validity of the January 2012 recess appointments.

By: Bryan Bienias, Esq.

After months of partisan political jujitsu, the U.S. Senate last week confirmed all five of President Obama’s nominations to the National Labor Relations Board. The three Democratic and two Republican members include Chairman Mark Gaston Pearce (D), Kent Hirozawa (D), Nancy Schiffer (D), Harry I. Johnson, III (R), and Philip A. Miscimarra (R). This marks the first time in over a decade that there will be a fully confirmed five-member panel.

The confirmations came just in time to avoid administrative paralysis, as Chairman Pearce’s term was set to end on August 27th, leaving the remaining two-member Board without a valid quorum and unable to act.

Now with a full complement, the Board can continue conducting business without the nagging legitimacy issues which have plagued the agency since the D.C. Circuit dropped its bombshell in the Noel Canning decision earlier this year (discussed here).

So, change is afoot? Maybe. With three Democratic Board members, employers should expect more “labor-friendly” decisions to come. However, the presence of two new Republican voices may help temper what has been viewed as an activist Board. Time will tell.

On a related note, the political dust had barely settled on the Board confirmations when President Obama last Thursday nominated Richard Griffin (the controversial recess appointee to the Board) to serve as the Board’s General Counsel. Obama’s withdrawal of Griffin’s nomination to the Board (as well as that of Sharon Block) was an essential component of the political deal that allowed the confirmations to proceed in the first place. 

As the Board’s top lawyer, Griffin will decide which labor cases to prosecute and help guide the agency’s interpretation of labor law.

That’s if the Senate confirms Griffin, right? Not necessarily. If the Senate were to deadlock on Griffin’s nomination as General Counsel, the President arguably could appoint Griffin to fill the temporary GC vacancy. If that were to happen, Griffin, like Lafe Solomon before him, would be the Acting General Counsel.

So, expect the Board’s Regional Field Offices under Griffin’s direction to continue pursuing many of the controversial positions the Board has staked out in recent years. In the meantime, employers are advised to brace themselves and prepare for more of the, well, very similar.

By: Anne D. Harris, Esq.

On July 2, 2013, a divided panel of the U.S. Court of Appeals for the Sixth Circuit vacated an NLRB ruling and found that registered nurses employed by a nursing home were supervisors under the National Labor Relations Act. 

The dispute arose in 2011 when the International Association of Machinists and Aerospace Workers petitioned the NLRB to represent the RNs in collective bargaining. The employer opposed the petition, arguing that the nurses had the authority to discipline, assign, and responsibly direct nursing assistants using independent judgment— therefore establishing supervisory authority and precluding union representation. 

The Board’s Regional Director rejected this argument; the union won the election among the RNs; and the employer refused to bargain with the union.

At issue in the subsequent unfair labor practice proceedings was an RN’s authority to deal with certain types of misconduct by nursing assistants. Specifically, in response to such misconduct, the RNs had authority to do nothing, provide verbal counseling, or draft a written memorandum. Although the panel majority agreed with the NLRB that verbal warnings were educational and not disciplinary, it found that the memorandum counted as a “step” in the employer’s disciplinary system. As such, the panel majority concluded that, “the authority that RNs have to issue memoranda to [nursing assistants] is the authority to discipline.” Furthermore, it found that the RN’s ability to decide which method to use constituted an exercise of independent judgment. 

Judge Merritt argued in a heated dissent that the majority expanded the definition of “discipline” beyond the longstanding definition of the term and created “a standard designed simply to foreclose collective bargaining, avoid unions, and go back to the unstable labor-management relations that existed prior to the New Deal.”

**A final word on this case. The Court was confronted (in a letter from the employer, after briefing was complete) with a Noel Canning argument concerning the Board’s authority to issue the underlying order. The Court agreed with the NLRB that the employer’s challenge to the recess appointments to the Board was not a jurisdictional issue, and the employer had waived the argument by not raising it earlier in the litigation. Whether its reasoning is correct, the Sixth Circuit’s decision underscores the importance to employers of raising the “recess appointments” issue at the earliest stage of any NLRB proceeding in which the employer is involved, at least until the Supreme Court rules on this issue.

By:  Nicholas R. Clements, Esq.

The Supreme Court announced today that it will hear the pivotal labor relations case, NLRB v. Noel Canning, during its 2013-2014 term.  Seyfarth Employer Labor Relations bloggers have written extensively about the Noel Canning matter since January 25, 2013.  See, e.g.,  here and here.  On that date, the U.S. Court of Appeals for the D.C. Circuit held that the recess appointments of National Labor Relations Board members Sharon Block and Richard Griffin, as well as former member Terence Flynn, were unconstitutional because they were made while the Senate was not in an intersession recess and the vacancies the appointees filled did not begin during an intersession recess of the Senate.   Judge David Sentelle of the D.C. Circuit Court wrote in his opinion that the administration’s interpretation of the recess appointment power would give the President “free rein to appoint his desired nominees at any time he pleases, whether that time be a weekend, lunch or even when the Senate is in session and he is merely displeased with its inaction.”

When the Court hears the case next term, the Justices will decide whether these recess appointments violated the Constitution and the National Labor Relations Act (“Act”).  If the Court upholds the D.C. Circuit court’s decision, the ramifications could be far-reaching: several hundred decisions and orders made by the Board since January 4, 2012 may be invalidated, and it could moot more than a hundred currently-pending cases in the various circuits of federal Court of Appeals.  Additionally, because recent Presidents have frequently utilized recess Board appointments over the past decade, many more decisions could also be in jeopardy.  According to Solicitor General Donald Verrilli, even more consequential could be the status of almost any federal officer who received a recess appointment during an intra-session recess, or who was appointed to fill a vacancy that did not first arise during the recess in which the appointment was made.  Needless to say, the Seyfarth Employer Labor Relations bloggers will be continually monitoring for updates during the course of the next year.  Stay tuned!

By:  Joshua M. Henderson, Esq.

Today, the Third Circuit Court of Appeals in Philadelphia set aside an order of the NLRB on the grounds that one of the members (Craig Becker) of a three-member panel that issued the order was not validly appointed to the Board. By a 2-1 vote, the Court of Appeals held in NLRB v. New Vista Nursing & Rehabilitation, that Becker’s intrasession appointment by President Obama in 2010 violated the Constitution’s “Recess Appointments Clause.”  The Third Circuit thus joins the D.C. Circuit in invalidating a recess appointment to the NLRB.  Taken together, these decisions effectively invalidate four recent appointments to the Board (Block, Becker, Flynn, Griffin). By ruling that Member Becker’s appointment was invalid, the Third Circuit’s decision expands the scope of controversial Board case law (including D.R. Horton, among others) that may be challenged on the grounds that it was not issued by a panel of three properly appointed members.

Although, like the D.C. Circuit in Noel Canning, the Third Circuit canvassed the historical record to aid its interpretation, the Third Circuit majority ultimately differed with the D.C. Circuit’s reasoning for declaring intrasession appointments unconstitutional. In contrast to the D.C. Circuit, the Third Circuit did not find the use of the definite article “the” in the phrase “the Recess of the Senate” to conclusively support intersession recess appointments. Rather, among other arguments, the Third Circuit construed the recess appointment power as an exception to the related (but separate) “Appointments Clause” of the Constitution, which enshrines power-sharing that includes the advice-and-consent power of the Senate. The Third Circuit rejected the Board’s “unavailable-for-business” definition of “recess.” That definition would be met by the Senate “whenever its members leave for the weekend, go home for the evening, or even take a break for lunch.” (Opinion, p. 64) It also would destroy the separation of powers.

The Third Circuit majority also rebuffed the argument that it was deciding a “political question” and somehow denigrating the president: “Defining recess in the Recess Appointments Clause does not express a lack of respect for coordinate branches of government because defining the word is merely an exercise of our judicial authority ‘to say what the law is,’ which sometimes requires an evaluation of whether one branch is aggrandizing its power at another‘s expense.” (Opinion, p. 24 n.5)

That New Vista Nursing & Rehabilitation was issued on the same day that the Senate begins confirmation hearings on a package of NLRB nominations (including two that were found to be unconstitutionally appointed in Noel Canning) is fortuitous. But it does raise the stakes of those hearings. And the stage is now set for what seems to be an inevitable review by the United States Supreme Court. The Board has urged the high Court to consider and reverse the D.C. Circuit’s Noel Canning decision. Now, the Third Circuit’s divided opinion in New Vista Nursing & Rehabilitation, with Circuit Judge Greenaway, Jr. (and Obama nominee) in dissent, will only increase the pressure on the Supreme Court to resolve the constitutional questions raised by these cases. Until then, the Board appears to be determined to continue to operate, though its legitimacy as currently constituted is in serious doubt.