A three-judge panel of the United States Court of Appeals for the District of Columbia Circuit has declared that President Obama acted unconstitutionally when he made three recess appointments to the National Labor Relations Board in January 2012, during the Senate’s holiday break. The ruling in Noel Canning v. NLRB raises questions about hundreds of decisions in which the disputed Board members participated, as well as their ability to weigh in on pending labor disputes.

In the D.C. Circuit decision issued on January 25, 2013, the court ruled that the NLRB order under review was void for lack of a quorum, as three members of the NLRB were appointed in violation of the Constitution's Recess Appointments Clause (RAC). The RAC authorizes the President to fill vacancies that occur “during the Recess of the Senate” by making appointments that expire at the end of the next session. 

The D.C. Circuit found two constitutional problems with the recess appointments. First, the court held that the words “the Recess” in the RAC refer only to an intersession recess of Congress and not to an intrasession recess (more properly described by the Founders as an “adjournment”). Because the second session of this past Congress began on January 3, 2012, and the appointments were made on January 4, the court concluded that they were not “recess appointments” under the RAC.

Second, the court held that, to qualify for a recess appointment under the RAC, the vacancy involved must “happen” during an intercession recess. Vacancies that predate a recess cannot be filled by recess appointments.

The decision will have a significant impact on the NLRB’s operations, given the 2010 decision of the U.S. Supreme Court in New Process Steel, L.P. v. NLRB. There, the Supreme Court held that the five-member NLRB could act only if it had a quorum of at least three members. Under New Process Steel, then, the NLRB never had more than two validly appointed members for most of 2012 and could not act during that period.

NLRB decisions that could be called into question as a result of the D.C. Circuit’s ruling include its controversial rulings on social media, the termination of union dues deductions after contract expiration, confidentiality in workplace investigations, and employee handbook disclaimers. As far as future decisions are concerned, the NLRB has taken the position that the ruling applies only to the case in question. The Board has said it will continue to decide cases without interruption.

Given this position and the importance of the issues raised, both from a labor law and constitutional perspective, the government can be expected to petition for a rehearing en banc before the D.C. Circuit and, if unsuccessful, to seek review by the U.S. Supreme Court.

Ballard Spahr’s Labor and Employment Group routinely assists employers in NLRB compliance. If you have questions or concerns about the recess appointments or NLRB issues, please contact Denise M. Keyser, 856.761.3442 or keyserd@ballardspahr.com or the lawyer in the Group with whom you work.

Copyright © 2013 by Ballard Spahr LLP.
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