NFIB v. NLRB – Round 2 Moves to the Court of Appeals: Appellate Court Receptive to NFIB’s Lawsuit against the Poster Rule

Round 2 of NFIB’s lawsuit against the NLRB’s “poster rule” got underway yesterday with arguments in the federal Court of Appeals in Washington, D.C. The rule, announced in August 2011, would require business owners to prominently post a notice in the workplace telling employees how to unionize.

After the NRLB issued the notice in 2011, NFIB sued to stop the rule. Besides taking issue with poster’s outrageously pro-union language, NFIB argued in court that the NLRB doesn’t have authority to impose a posting requirement on over six million employers. As a creature of statute, the NLRB can do only what Congress tells it to do. And Congress hasn’t told the NLRB to issue a poster. In March, federal District Court Judge Amy Berman Jackson ruled that the NLRB had authority to issue the poster rule. NFIB and other employer groups appealed Jackson’s order and asked the federal court of appeals to adopt the opinion of a federal District Court judge in South Carolina who, in another lawsuit, struck down the rule.

During yesterday’s argument, the NLRB apparently conceded that the agency lacks power to impose affirmative obligations on employers unless the employer commits an unfair labor practice. Then,—remarkably—the NLRB made the bold, and unwieldy, claim that failure to inform employees of their rights under labor laws is an unfair labor practice in itself.

In other words, the NLRB believes that the agency can order millions of employers to post information about labor law because federal law currently imposes an affirmative obligation on employers to educate employees about their right to unionize. More outrageous – under the NLRB’s view, employers who fail to inform employees of their rights are today in violation of the National Labor Relations Act. Not surprisingly, this assertion, which would give the NLRB seemingly unlimited power, met skepticism from the judges.

The NLRB contends that changing workforce demographics justify the poster rule. In the agency’s words, because there is a higher percentage of non-English speaking workers and lower percentage of union members, workers don’t know their NLRA rights. Such an assumption is dubious in the Internet age. And the agency conducted no empirical study to back up its assertion that a (biased, one-sided) poster in the break room will increase awareness of NLRA rights. In other words, the NLRB hasn’t shown the rule is necessary, a requirement for federal rulemaking (this is assuming the agency had authority to issue a poster rule, which it doesn’t).

The bottom line is that yesterday’s argument failed to demonstrate why the NLRB has authority to compel business owners to display these posters. Moreover, there is something dubious about the agency’s suggestion that it should have free reign to decide the scope of its own jurisdiction. To be sure, there is nothing stopping the NLRB from imposing further burdens on employers if it gets away with this. Perhaps next it will require employers to pay employees to attend labor training, or file annual reports on labor issues, or to allow union activists on to their property to lecture employees on labor issues. If we throw away the statutory limitations on the agency’s powers, then anything goes.

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About Luke Wake

Luke A. Wake is a senior staff attorney at the NFIB Small Business Legal Center. Wake has particular expertise on environmental and land use issues, and has worked on numerous other constitutional issues and matters of importance to small business owners. He is an ardent defender of private property rights, which he believes are essential to the free enterprise system and the foundation of American liberty. As a strong advocate of individual rights and economic liberties, he has built his career defending small business interests. Since joining the NFIB Legal Center, Wake has focused on a whole host of issues, from employment law matters to regulatory compliance. In addition to serving as a resource for small business owners, Wake remains committed to the Legal Center’s pledge to ensure that the voice of small business is heard in the nation’s courts. He is also working to advance small business interests in law review articles, including publications in the Berkeley Journal of Law & Ecology, the Texas Journal of Law and Politics, and Competition Magazine. See R.S. Radford & Luke A. Wake, Deciphering and Extrapolating: Searching for Sense in Penn Central, 38 Ecology L.Q. 731, 746-747 (2011); Damien M. Schiff, Luke A. Wake, Leveling the Playing Field in David v. Goliath: Remedies to Agency Overreach, 17 Tex. L. Rev. & Pol. 97 (2012); Jarod M. Bona and Luke A. Wake, The Market-Participant Exception to State-Action Immunity From Antitrust Liability, J. of Antitrust and Unfair Competition of the State Bar of Ca., Vol. 23, No. 1, 156 (Spring 2014); James S. Burling and Luke A. Wake, Takings and Torts: The Role of Intention and Foreseeability in Assessing Takings Damages, in Condemnation 101: Making the Complex Simple in Eminent Domain 449-51 (ALI-ABA Committee on Continuing Professional Education eds. 2011). Before joining the Legal Center’s team, Wake completed a prestigious two-year fellowship as an attorney in the Pacific Legal Foundation’s (PLF) College of Public Interest Law. Wake is a graduate of Case Western Reserve University School of Law in Cleveland Ohio. He is a member of the California Bar, the District of Columbia Bar, and the U.S. Supreme Court Bar. He completed his undergraduate studies at Elon University in North Carolina in 2006 where he focused on political theory and corporate communications.
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2 Responses to NFIB v. NLRB – Round 2 Moves to the Court of Appeals: Appellate Court Receptive to NFIB’s Lawsuit against the Poster Rule

  1. Pingback: Friends in High Places: NFIB Small Business Legal Center Gains Historic Supreme Court Ranking |

  2. Pingback: Great News for Small Business: NLRB’s Notice Poster Rule is Dead |

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