Friday, May 1, 2009
We've posted quite a bit about challenges to decisions issued by the two-member NLRB (see, for instance, here, here, and here) and now the near-final verdict is in: the decisions are struck down. In the Laurel Baye decision issued today, the D.C. Circuit held that the two-member NLRB did not have authority to issue decisions. The key issue in the case was whether the Board correctly interpreted Section 3(b) of the NLRA as permitting two-members decisions. Section 3(b) states that:
According to the court, the Board's interpretation of this provision was improper:
Reading the two quorum provisions harmoniously, the result is clear: a three-member Board may delegate its powers to a three-member group, and this delegee group may act with two
members so long as the Board quorum requirement is, “at all times,” satisfied. But the Board cannot by delegating its authority circumvent the statutory Board quorum requirement, because this requirement must always be satisfied.
Indeed, if Congress intended a two-member Board to be able to act as if it had a quorum, the existing statutory language would be an unlikely way to express that intention. The quorum
provision clearly requires that a quorum of the Board is, “at all times,” three members. A modifying
phrase as unambiguous as this denotes that there is no instance in which this Board quorum requirement may be disregarded. . . .
Congress provided that a quorum of the Board is three members. The Board does not have three members. It cannot act. Though section 3(b) gives the Board power to delegate its authority to a group of members, this authority is necessarily limited by the fact that the delegation authority
allows the Board to grant its power only to a group of three or more members. The Board’s
delegation power is also obviously limited by the fact that the Board quorum provision establishes that the power of the Board to act exists when the Board consists of three members.The
delegee group’s delegated power to act, however, ceases when the Board’s membership dips below the Board quorum of three members. It therefore follows that where, as here, a delegee group acts on behalf of the Board, the Board quorum requirement still must be satisfied.
As I've said before, I agree with this interpretation of Section 3(b), although thought the Board had a reasonable position and an admirable goal of keeping the agency doing what it's supposed to do (and hats off again to Members Liebman and Schaumber for all their hard work during this time). More important, however, is that this decision will impose a significant cost on the Board and the victims of unfair labor practices in all the affected cases--as they'll now have to wait a lot longer to have their cases heard again. To its credit, the D.C. Circuit addressed this reality in its closing:
Finally, we acknowledge that the case before us presents a close question, and that neither OLC’s interpretation nor the Board’s desire to continue to function is entirely indefensible. Both were undoubtedly born of a desire to avoid the inconvenient result of having the Board’s adjudicatory wheels grind to a halt. Nevertheless, we may not convolute a statutory scheme to avoid an inconvenient result. Our function as a court is to interpret the statutory scheme as it exists, not as we wish it to be. Any change to the statutory structure must come from the Congress, not the courts. Perhaps a properly constituted Board, or the Congress itself, may also minimize the dislocations engendered by our decision by ratifying or otherwise reinstating the rump panel’s previous decisions, including the case before us. See, e.g., FEC v. Legi- Tech, Inc., 75 F.3d 704 (D.C. Cir. 1996) (affirming properly reconstituted FEC Board’s ratification remedy for its unconstitutional membership).
Perhaps a small silver lining for the Board in this case is that Congress and the Obama Administration will try to move more quickly to get the Board back up to its full complement of members.
Finally, in a late-breaking twist, I've just found out (thanks to Peter Winkler, Dennis Walsh, and Patrick Kavanagh) that the NLRB actually won on the exact same issue today in the Seventh Circuit. The court's analysis in New Process Steel isn't as thorough as the D.C. Circuit's, although much more so than the First Circuit's, which earlier upheld the two-member decisions. In New Process Steel, the Seventh Circuit held that the decisions were valid, stating (among other things) that the Board's reading of Section 3(b):
Thus far--and the way today is going, who knows what other court will weigh in--the count is now 2-1 in favor of the NLRB's current two-members decisions. Unfortunately for the Board, the votes aren't weighted equally. Not only does the D.C. Circuit have jurisdiction over every potential NLRB case (so any party that wanted to challenge a two-member decision can race to file there), its holding generally garners far more respect than those of other circuits.
I don't know how the Board will decide to proceed until it gets more members; it could apply its non-acquiescence rule and continue to plow ahead or it can sit back and wait a bit until it can be sure that what it does won't be struck down because of this issue. I imagine the Board itself doesn't know at this point, so we'll have to wait and see. You can also see the AP story that quotes the NLRB's press release on Laurel Baye.
Hat Tip: Jeff Wilson & Peter Winkler