The NLRB was issued a stunning rebuke yesterday by U.S. District Court Judge James Boasberg (an Obama appointee) when he ruled that the NLRB’s controversial union election rule changes were invalid because they were enacted without the required three-member quorum. The NLRB may appeal Judge Boasberg’s decision. However, at least for the present, the Court’s decision in Chamber of Commerce, et al. v. NLRB renders the union election rule changes, which took effect April 30, 2012, null and void.
The election rule changes have been the source of considerable tension between employer and union groups for the past year. They were predicted to shorten the period for union elections from the current average of approximately 40 days to as few as 10 to 21 days after a union election petition is filed. The NLRB and pro-labor groups contended the rule changes were desirable because they would streamline the election process and cut down on litigation costs. Employer groups came out strongly against the election rule changes, contending that they gave unions an unfair advantage.
The employer group’s strong opposition to the rule changes was shared by NLRB Member Brian Hayes, the lone "Republican" appointee on the Board when the NLRB took its final vote on the rule changes in December, 2011. In fact, Member Hayes was so strongly opposed to the election rule changes that he threatened to resign prior to the vote being taken to prevent the NLRB from having the three-member quorum necessary to approve the rule changes. Ultimately, Member Hayes decided not to resign. However, when the NLRB used its electronic case management system to circulate the final rule among the NLRB’s three Members, Member Hayes did not cast a vote or enter an appearance. The other two NLRB Members, both Democratic appointees, did cast votes to adopt the rule changes. The NLRB proceeded with implementing the rule based on those two favorable votes.
The U.S. Chamber of Commerce filed suit seeking to enjoin enactment of the rule changes within days of NLRB’s December vote. The Chamber’s lawsuit raised multiple substantive and procedural challenges to the election rule changes. However, Judge Boasberg found that it was unnecessary to rule on any but one of the Chamber’s arguments because he agreed that the NLRB lacked the authority to issue the rule changes. In what will likely be an oft quoted passage from the decision, the first paragraph of Judge Boasberg presaged the outcome: "According to Woody Allen, eighty percent of life is just showing up. When it comes to satisfying a quorum requirement, though, showing up is even more important than that. Indeed, it is the only thing that matters – even when the quorum is constituted electronically."
The NLRB may appeal Judge Boasberg’s decision. Or, it may go back and take another vote on the election rule changes. However, any vote now taken also will be taken with the backdrop that federal litigation is now pending that challenges the three recess appointments that President Obama made to the NLRB on January 4, 2012.