Last week, the U.S. Supreme Court began its first full term since the death of Justice Antonin Scalia, the central advocate for the Court’s conservative bloc. Since Justice Scalia’s death this past February, the Court has remained in a sort of an ideological limbo, and the Senate will not consider President Obama’s nominee to succeed Justice Scalia, Judge Merrick Garland, before the November presidential elections. With only eight members for the final few months of its prior term, the Court split 4-4 on several major decisions, including two labor and employment decisions.
Perhaps sensing the uncertainty it faces, the Court has granted certiorari more sparingly this year. Moreover, the cases the Court has agreed to hear are generally not the “blockbuster” cases that it has agreed to address in prior terms.
Nonetheless, the Court has agreed to hear two cases that could have important implications for employers. Additionally, there is one additional case that will likely make its way onto the Court’s docket in the coming months. The following is a brief summary of each of these three cases:
- SW General v. NLRB, No 15-1251: The Court will once again consider the President’s authority to make agency appointments. This time, the Court will review whether the Federal Vacancy Reform Act (the “Act”) gives the President’s “acting” appointee the power to serve in that position until confirmed by the Senate. When President Obama appointed Lafe Solomon to serve as “acting” General Counsel to the National Labor Relations Board (“NLRB”) in June 2010, the Senate later rejected Solomon’s official nomination. Ultimately, Richard Griffin was confirmed as General Counsel and began serving on November 4, 2013. The D.C. Circuit Court of Appeals held that Solomon served in violation of the Act between January 5, 2011 and November 4, 2013, and voided the NLRB’s issuance of an unfair labor practice complaint against SW General during that time period. The Court will now decide whether Solomon became ineligible to serve as Acting General Counsel once the President nominated him to be General Counsel.
- McLane Co. Inc. v. EEOC, No. 15-1248: The Court will consider a case involving the EEOC’s subpoena power during the course of an investigation. The case, out of the Ninth Circuit, involves the EEOC’s investigation of sex discrimination allegations against McLane that arose when one employee failed several physical strength tests after returning from maternity leave. The EEOC broadened its investigation and requested personally identifiable information, including names, Social Security numbers and phone numbers, of thousands of applicants and employees. The Court will decide a narrow issue: whether the Ninth Circuit granted the District Court proper deference when reviewing a ruling that the EEOC’s subpoena was not enforceable. The Ninth Circuit reviewed the District Court’s decision “de novo”—meaning without any deference—and held that the information requested by the EEOC was relevant to the investigation. The Court will review this narrow issue and determine the proper level of deference for a lower court’s ruling on an administrative subpoena. The clarification will be important for employers looking to quash or limit a broad – and likely costly – EEOC subpoena.
- Employee Class Action Waivers: There are several petitions for certiorari before the Court to determine whether or not an employer can require all of its employees to execute mandatory arbitration agreements that not only require employees to pursue disputes through arbitration (rather than through a court), but also waive their right to participate in class or collective actions. In 2012, the NLRB held that such agreements were unlawful under the National Labor Relations Act (“NLRA”). The NLRB reasoned that because Section 7 of the NLRA protects employee rights to improve their working conditions through proceedings in court, an employee’s right to pursue these goals through a class or collective action lies at the “core” of the legal protections of federal labor law. Therefore, requiring employees to refrain from bringing collective or class actions in any forum, including arbitration, improperly barred employees from exercising their substantive rights under Section 7. The NLRB’s ruling was challenged in federal courts throughout the country; eventually, a circuit split emerged, thereby creating an opportunity for the Court to weigh in on the matter. Notably, the Seventh Circuit Court of Appeals, which has jurisdiction over Illinois, Wisconsin, and Indiana, agreed with the NLRB and upheld its ruling. Guided by the NLRB’s reasoning, the court held that class action litigation, involving employees banding together to collectively assert a legal challenge to a workplace practice, is as “concerted” as activity can be. The Court may choose to resolve this circuit split and determine the legality of class action waivers.
It is clear that whoever fills the vacancy left by Justice Scalia will influence the direction of the Court for years to come. In the meantime, we will continue to provide updates if the Court grants certiorari in additional cases with significant labor or employment ramifications.