Court Declares Obama's NLRB Appointments Unconstitutional

On Friday, January 25th, the U.S. Court of Appeals for the District of Columbia invalidated three of President Obama's appointees to the National Labor Relations Board (the "Board"), calling into question the validity of every decision issued by the Board since January 2012.

The Board consists of five official members, who must be approved by the United States Senate. Under federal law, the Board can only issue decisions when three Board members are sitting. On January 4, 2012, President Obama appointed individuals to fill three vacant Board seats.

The Court's decision on January 25th invalidated those January 2012 appointments as unconstitutional.

Under the Constitution, the President has the authority to temporarily appoint government officials when the Senate officially recesses between sessions. President Obama, the Court found, appointed these three individuals when the Senate had not gone into an official recess. As a result, the President was required to get the Senate's approval before installing these three as Board members. Since the President failed to do so, the Court struck down these appointments.

This lawsuit was initiated by a Pepsi bottling and distributing company. The company appealed the Board's determination that the company had violated the National Labor Relations Act (the "Act"). With the January 25, 2013 decision invalidating the appointment of these three Board members, only two Board members were technically sitting when the Board determined that the company had violated the Act. As discussed, three members must be sitting in order to issue official opinions. Accordingly, the Court struck down the Board's determination that the company had violated the Act.

The Obama Administration is likely to appeal the Court's decision to the Supreme Court. By doing so, it may be quite some time before the outcome of this case is finalized. However, if the January 25th decision ultimately stands, it is a significant victory for employers.

The Court's decision calls into question the validity of the more than 200 decisions issued by the Board since January 4, 2012. Going forward, there is only one official Board member. The Board does not have a quorum to issue any new rules or decisions. Additionally, the President must get the Senate's approval before appointing any new Board members.

Employers which dealt with the National Labor Relations Board in 2012, or which relied upon a Board decision from this past year, should contact a member of our Labor and Employment Practice Group to discuss the potential ramifications of the Court's legal decision. Members of MacDonald Illig's Labor and Employment Practice Group include: