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April 18, 2014

National Labor Relations Board (NLRB) Posting Rule Held Invalid by D.C. Circuit Court of Appeals

We have advised you in the past as to the status of the National Labor Relations Board's (NLRB) attempt to require employers to post a notice advising employees of rights under the National Labor Relations Act (NLRA). On May 7, 2013, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the National Labor Relations Board's requirement is invalid. National Ass'n. of Manufacturers v. NLRB, No. 12-5068).

The posting regulation was adopted by the NLRB in August 2011 and would have required approximately six million employers over which NLRB has jurisdiction to post a notice informing workers of their rights under the NLRA. The regulation provided that failure to post the notice would be an unfair labor practice under Section 8(a)(1) of the Act, and that failure to post the notice would be considered by NLRB to be evidence of an employer's unlawful motive in cases in which motive was an issue. The rule further provided that the six-month statute of limitations for filing unfair labor practice charges could be tolled in situations where an employer had failed to post the required notice.

NLRB's authority to promulgate such a rule was challenged by various business groups and employers in the U.S. District Court for the District of Columbia. In March 2012, the District Court held that the notice-posting requirement fell within the ambit of the NLRB's rule-making authority granted by Section 6 of the NLRA. However, the Court found that NLRB had exceeded its authority by making the failure to post an unfair labor practice, and by adopting the provision tolling Section 8(b)'s limitations period for failure to post. Both the employer groups and NLRB appealed the lower court decision to the D.C. Circuit Court of Appeals, which enjoined enforcement of the notice-posting rule until the appeal was resolved.

Writing for the D.C. Circuit, Judge A. Raymond Randolph did not decide whether the NLRB had authority to promulgate such a rule under Section 6 of the Act. Rather Judge Randolph focused on Section 8(c) of the Act, which protects an employer's right to express its views and opinions to employees in a non-coercive manner. Judge Randolph held that both Section 8(c) and the First Amendment protected the right to disseminate a message, as well as the right to decide not to disseminate it. Since an employer's failure to post the required notice would be an unfair labor practice and evidence of unlawful motive, the Court found that the NLRB's regulation ran afoul of Section 8(c) and the First Amendment. The Court further found that NLRB's tolling of Section 8(b)'s limitations period was not supported by congressional intent. Thus, it ruled the entire regulation invalid.

Judges Henderson and Brown agreed with Judge Randolph's analysis of Section 8(c) but in a concurring opinion would also hold that the notice-posting regulation exceeded NLRB's grant of authority under Section 6 of the NLRA. The concurring opinion noted that the NLRA's language and structure are remedial in nature and that Congress did not intend " …to authorize a regulation so aggressively prophylactic as the posting rule."

At this time, it is unknown whether NLRB will challenge the D.C. Circuit's ruling. A spokesperson for the NLRB noted that the rule is also under review by the Fourth Circuit Court of Appeals. In that case, the District Court for the District of South Carolina ruled in April 2012 that the NLRB had exceeded its authority in adopting the rule (Chamber of Commerce v. NLRB, 856 F. Supp. 2d 778) and NLRB appealed.

© 2014 Schiff Hardin LLP

About the Author

Partner

Henry W. Sledz Jr. concentrates his practice in representing management, encompassing all aspects of employment law, from labor agreement negotiations and arbitrations to litigation before numerous state and federal courts and agencies. This includes a particular emphasis on food and dairy industry clients.

Mr. Sledz also has significant experience in public sector labor law, representing villages, school districts, colleges and universities in labor negotiations, arbitrations and general counseling.

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