NLRB Intra-session Recess Appointments Were Unconstitutional, Precluded Quorum: Fourth Circuit | Practical Law

NLRB Intra-session Recess Appointments Were Unconstitutional, Precluded Quorum: Fourth Circuit | Practical Law

In NLRB v. Enterprise Leasing Co. Southeast, LLC, the US Court of Appeals for the Fourth Circuit, by a 2-1 split, found the President's January 4, 2012 recess appointments to the National Labor Relations Board (NLRB) unconstitutional and precluded the NLRB from acting with a three-member quorum as required under the National Labor Relations Act (NLRA). The Fourth Circuit denied enforcement of two NLRB orders by NLRB panels that it found lacked a quorum since the intra-session recess appointment of Member Griffin could not count towards NLRA quorum requirements.

NLRB Intra-session Recess Appointments Were Unconstitutional, Precluded Quorum: Fourth Circuit

by Practical Law Labor & Employment
Published on 22 Jul 2013 • USA (National/Federal)
In NLRB v. Enterprise Leasing Co. Southeast, LLC, the US Court of Appeals for the Fourth Circuit, by a 2-1 split, found the President's January 4, 2012 recess appointments to the National Labor Relations Board (NLRB) unconstitutional and precluded the NLRB from acting with a three-member quorum as required under the National Labor Relations Act (NLRA). The Fourth Circuit denied enforcement of two NLRB orders by NLRB panels that it found lacked a quorum since the intra-session recess appointment of Member Griffin could not count towards NLRA quorum requirements.
On July 17, 2013, the US Court of Appeals for the Fourth Circuit issued an opinion in NLRB v. Enterprise Leasing Co. Southeast, LLC, finding the January 4, 2012, recess appointments to the panel (Board) in charge of the NLRB's election processes and heading the NLRB's judicial functions were unconstitutional. The Fourth Circuit largely echoed the analysis of the US Court of Appeals for the District of Columbia Circuit in Noel Canning v. NLRB by finding the recess appointments unconstitutional because the Senate was not in full recess when the appointments were made and invalidated the Board's decisions.
The Fourth Circuit's ruling arose after two employers, Enterprise Leasing Company and Huntington Ingalls, Inc. refused to bargain with the unions that were elected to represent some of their employees to trigger appellate court review of the NLRB's rulings on:
  • The appropriateness of the bargaining units.
  • Challenges and objections to the elections.
The Board issued each decision at times when it was comprised of only two Senate-confirmed Members and needed January 4, 2012 intra-session appointments to count towards the three-member quorum requirements under the NLRA.
The Fourth Circuit:
  • Held that:
    • the January 4, 2012 intra-session recess appointments to the Board were unconstitutional under the recess appointment clause because the Senate was not in recess at the time;
    • the Board lacked the statutory quorum required under the NLRA when it issued the decisions the court was reviewing jointly;
    • challenges to the recess appointments are constitutional rather than jurisdictional. The Fourth Circuit like the DC Circuit, reviewed the substance of the employer's petition for review and the Board's petition for enforcement under the NLRA before denying enforcement to the decisions because the Board lacked a lawful quorum. Unlike the US Court of Appeals for the Third Circuit, the Fourth Circuit (and the DC Circuit) did not view lack of quorum as entirely voiding the Board's jurisdiction over the matters and rendering review of the substance of the underlying Board decision unnecessary (NLRB v. New Vista Nursing & Rehab.); and
    • the employers failed to show that the Board's decisions were unsupported by record evidence or not based on reasoned analysis. The court side-stepped reviewing the Board's application of Specialty Healthcare by finding that the employers failed to show that the challenged bargaining units were not appropriate under earlier precedent. It was unnecessary to evaluate whether the employers met the heavier overwhelming community of interest burden from Specialty Healthcare or whether that standard was appropriate (see Legal Update, NLRB Changes Standard for Determining an Appropriate Bargaining Unit).
  • Denied enforcement of the Board's decision and order in each case.
The Supreme Court will consider the validity of intra-session recess appointments to the Board when it reviews the DC Circuit's decision in Noel Canning (see Legal Update, US Supreme Court to Review Noel Canning, Scope of President's Recess Appointment Authority).
Court documents: