The National Labor Relations Board indicated that it will press ahead with its work, despite a bombshell ruling Friday that called into question the legitimacy of the agency's board and of the cases decided by President Obama’s recess appointees over the past year.
A federal appeals court ruling Friday denying President Obama’s authority to make the recess appointments was triggered by a single case brought before the labor board by a small bottling company. Board officials for now are contending that, for now, it can continue to operate as the legal battle proceeds.
“The Board respectfully disagrees with today’s decision and believes that the president’s position in the matter will ultimately be upheld,” NLRB Chairman Mark Gaston Pearce said late Friday in a statement. “In the meantime, the board has important work to do. The parties who come to us seek and expect careful consideration and resolution of their cases, and for that reason, we will continue to perform our statutory duties and issue decisions.”
The National Labor Relations Board found itself in a bureaucratic no man’s land after President Obama’s recess appointments last year — union lawyer Richard Griffin and Labor Department official Sharon Block, both Democrats, and a Republican, NLRB lawyer Terence Flynn — were overturned by the U.S. Court of Appeals for the D.C. Circuit.
This places a cloud over the NLRB’s immediate future.
The board members whose appointments are being called into question could stop issuing decisions until the Supreme Court resolves the matter. That would leave Mr. Pearce as the only valid board member, and the law does not allow the NLRB to make decisions with fewer than three members.
“It remains to be seen how the board will react to this,” said Ronald Meisburg, a former NLRB board member and general counsel.
Casting a shadow
If upheld by the Supreme Court, the decision cast a deep shadow not only over the agency’s future work, but call into question the many cases it decided last year, according to Mr. Meisburg, a partner at Proskauer Rose LLP and co-head of the firm’s Labor-Management Relations Group.
“It effectively means going forward that the court’s decision will essentially shut down the board’s ability to decide cases,” he said.
According to agency documents, the NLRB’s board issued 341 decisions for fiscal year 2012, which ended in September, a period that largely overlapped with the time when the three contested appointees officially joined the board.
“The thing that people probably don’t realize is that all the decisions that were made are now erased,” said Fred Wszolek, spokesperson for the Workforce Fairness Institute, a conservative organization and frequent critic of the NLRB.
That means all of the cases that the board decided could not only be thrown out — but they would also have to be re-tried.
“That’s why these appointments were so reckless by the president, because now they’ll have to do it all over again, they’ll have to pay those bills twice,” Mr. Wszolek said. “All of those businesses and unions will have to spend millions of dollars trying their cases again.”
Congressional Republicans and business groups that supported the lawsuit said the result represented a needed check to an agency they have long accused of tilting strongly toward unions under Mr. Obama.
“The Obama administration has consistently used the NLRB to impose regulations that hurt our economy by fostering uncertainty in the workplace and telling businesses where they can and cannot create jobs,” GOP House Speaker John Boehner, who filed a brief supporting the challenge to the board’s legitimacy.
But the labor movement joined with the White House in taking strong issue with the ruling.
AFL-CIO chief Richard Trumka denounced the decision as “shocking” and said the NLRB members should stay at their posts as the legal battle proceeds.
“We fully expect this radical decision to be reversed, and that other courts addressing this issue will uphold the president’s recess appointment authority,” Mr. Trumka said in a statement. “In the meantime, the appointees to the National Labor Relations Board remain in their jobs and the NLRB remains open for business.”