The U.S. Supreme Court has agreed to review whether the National Labor Relations Board (“NLRB”) has a sufficient number of members to issue rulings. The Supreme Court will review the decision of the District of Columbia Circuit in NLRB v. Noel Canning Div. of Noel Corp.. There, the D.C. Circuit ruled that the NLRB lacked the necessary three-member quorum to decide an unfair labor practice case. The D.C. Circuit determined that President Obama’s recess appointments of two of the three members of the NLRB panel occurred when there was not a true “recess,” making the appointments unconstitutional. The decision has the potential to impact hundreds of NLRB decisions dating back to at least January 2012 as well as the NLRB’s recent expedited election rulemaking discussed in more detail below.

In its appeal of an unfair labor practices decision by the NLRB, Noel Canning argued that the NLRB did not have the requisite quorum to act because the President’s recess appointments of two of the three panel members who decided the case, Sharon Block and Terence Flynn, were invalid. The Recess Appointments Clause of the U.S. Constitution provides, “The President shall have the Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.” Block and Flynn were appointed while the U.S. Senate was holding “pro forma” sessions every three days in an effort to prevent recess appointments. The D.C. Circuit interpreted the Recess Appointments Clause to require that recess appointments be made during intersession breaks—i.e., breaks that happen between enumerated sessions of Congress not intrasession breaks that happen during a particular session—for vacancies that arise during the recess. Consequently, the court invalidated the appointments of Block and Flynn.

The U.S. Supreme Court granted review of three issues:

  1. Whether the President’s recess-appointment powers may be exercised during a recess that occurs within a session of the Senate, or is instead limited to recesses that occur between enumerated sessions of the Senate.
  2. Whether the President’s recess-appointment power may be exercised to fill vacancies that exist during a recess, or is instead limited to vacancies that first arose during that recess.
  3. Whether the President’s recess-appointment power may be exercised when the Senate is convening every three days in pro forma sessions.

We expect a decision in this case in mid-2014. If the justices side with the D.C. Circuit, the ruling would call into question all NLRB action taken since at least January 2012, when Block and Flynn were appointed, including but not limited to the NLRB’s recent decisions regarding an employer’s duty to bargain with unions over significant employee discipline, an employer’s duty to deduct dues from employees’ paychecks, “courtesy” policies, and class action waivers in arbitration agreements.