Quoting Woody Allen in the decision’s opening passage, today District Court Judge James Boasberg of the District Court for the District of Columbia granted summary judgment to the U.S. Chamber of Commerce in its lawsuit against the National Labor Relations Board’s "quickie" election rule. The Board rule, published in the Federal Register on Thursday, December 22, 2011, amended its election case procedures to shorten the time between the filing of a petition and the conduct of a union representation election. The rule went into effect on April 30, 2012.
The Court today, however, ruled that the final rule was promulgated without a proper quorum of three Board Members, and therefore must be set aside as beyond the Board’s authority….for now:
In so doing, however, the Court emphasizes that its ruling need not necessarily spell the end of the final rule for all time. The Court does not reach – and expresses no opinion on – Plaintiffs’ other procedural and substantive challenges to the rule, but it may well be that, had a quorum participated in its promulgation, the final rule would have been found perfectly lawful. As a result, nothing appears to prevent a properly constituted quorum of the Board from voting to adopt the rule if it has the desire to do so. In the meantime, though, representation elections will have to continue under the old procedures.
Somewhat interesting to note, the Court states clearly that the Board was denied the authority to act merely by Member Hayes refusal to participate in the rulemaking:
Two members of the Board participated in the decision to adopt the final rule, and two is simply not enough. Member Hayes cannot be counted toward the quorum merely because he held office, and his participation in earlier decisions relating to the drafting of the rule does not suffice. He need not necessarily have voted, but he had to at least show up.
This strikes us as an extension of the Supreme Court’s New Process Steel decision, 130 S. Ct. 2635, 2638 (2010), cited here by the parties and the Court. Only Judge Boasberg’s decision specifies that the three required Board Members must not only be properly seated, but also participate in the action for it to pass muster. Observers will recall that at the time of the rulemaking action, there was considerable speculation as to whether Member Hayes might step down from the Board to prevent it from acting. As it may turn out, he did not have to.
Initial thoughts about "takeaway":
This decision foreshadows the coming showdown over President Obama’s January 2012 "recess" appointments. Judge Boasberg’s decision strongly suggests that if there is an interest in a fully functional National Labor Relations Board, there must be a fully seated Board — or at least a full quorum of three like-minded Members who will participate in actions.
Finally, it is unclear whether the decision truly opens the door to allow an obstinate Member to derail the Board by perpetually ignoring Board overtures to act. On the facts of this case, the Judge simply found there was no quorum:
Had someone reached out to him to ask for a response, as is the agency’s usual practice where a member has not voted, or had a substantial amount of time passed following the rule’s circulation, moreover, it would have been a closer case. But none of that happened here. In our prior world of in-person meetings, Hayes’s actions are the equivalent of failing to attend, whether because he was unaware of the meeting or for any intentional reason. In any event, his failure to be present or participate means that only two members voted, and the rule was then sent for publication that very day.
For now, the Board’s prior rules will remain in place, and parties should expect the current median of 38 days to remain the approximate amount of time between the filing of a petition and an election. It does, however, raise the interesting question of the extent to which elements of the Acting General Counsel’s new guidelines — designed to expedite election processing consistent with the rule — will survive as an administrative matter on the regional level.