Rule Required Most Private Sector Employers to Notify Employees of Labor Law Rights

The U.S. Court of Appeals for the D.C. Circuit has vacated the National Labor Relations Board (NLRB) rule requiring most private sector employers in the United States to post a notice of employees' labor law rights. National Ass’n of Mfrs. v. NLRB, No. 12-5068 (D.C. Cir. May 7, 2012). (We have discussed the rule in prior alerts that can be found here and here.)

The D.C. Circuit previously enjoined the NLRB's rule pending decision in this appeal. Now it has held that the notice-posting rule effectively compels employers to speak about employees' labor law rights in violation of a provision of the National Labor Relations Act (NLRA) that protects employers' rights to free speech about union issues.

The Notice-Posting Rule

The notice-posting rule requires virtually all private-sector employers to post an 11" x 17" government-created notice describing employees' rights under the National Labor Relations Act (NLRA). The rule creates three methods for enforcing the posting requirement. It makes the failure to post the notice an independent unfair labor practice and it treats such a failure as evidence of anti-union animus in cases involving, for example, unlawfully motivated firings or refusal to hire. It also provides that the six-month statute of limitations for unfair labor practices is tolled during periods in which the notice is not posted, unless the specific employee at issue had actual notice of his or her rights under the NLRA.

Vacating the Rule

In vacating the rule, the D.C. Circuit held that the rule's first two methods of enforcement violate Section 8(c) of the NLRA, which states that "[t]he expressing of any views, argument, or opinion, or the dissemination thereof . . . shall not constitute or be evidence of an unfair labor practice under" the NLRA, if "such expression contains no threat of reprisal or force or promise of benefit." The court said Section 8(c) protects an employer's right not to speak as well as its right to speak, and because the notice-posting rule treats a failure to speak by refusing to post the notice as an unfair labor practice or evidence of an unfair labor practice, it is inconsistent with Section 8(c) of the NLRA.

The third method of enforcement — tolling the statute of limitations — "substantially amends the statute of limitations that Congress expressly set out in the statute" and therefore "exceeds [the Board’s] statutory authority" to promulgate rules, the court ruled.

Finding that the notice-posting requirement itself could not be separated from the means for enforcing it, the court decided that the entire rule had to be vacated.

Because employers can always appeal an NLRB decision to the D.C. Circuit, this ruling effectively precludes the NLRB from enforcing the notice-posting rule unless and until it obtains a contrary decision from the U.S. Supreme Court. Holland & Knight will continue to provide updates on this topic.