Court Delays Controversial NLRB Poster Requirement

The request for an injunction, filed by the National Association of Manufacturers (NAM), stems from its appeal of the U.S. District Court for the District of Columbia's March ruling on NAM's challenge to the Final Rule. The district court generally upheld the posting requirement, but ruled that the NLRB went too far when it declared that failure to post is an automatic unfair labor practice, and stayed the statute of limitations for any unfair
practice charges. However, the district court noted that “nothing in [its] decision prevents the [NLRB] from finding that a failure to post constitutes an unfair labor practice in any individual case brought before it,” but that any such finding must be based on the facts and circumstances of each specific case.

While the NLRB opposed a delay in enforcement of the Final Rule pending NAM's appeal, the D.C. Circuit disagreed. In a per curiam opinion, the appellate court noted that the uncertainty about enforcement of the Final Rule weighed in favor of temporarily preserving the status quo pending resolution of the appeal. Of particular significance to the court was the tension between the NLRB's prior position of voluntarily postponing the rule pending litigation, with its current position that the rule should be implemented during the pendency of an appeal. Together with the NLRB's potential appeal of another aspect of the lower court's ruling ' which severed portions of the rule as invalid ' the appellate panel concluded that the tension left enough uncertainty surrounding enforcement of the rule to merit an injunction.

In support of its conclusion, the D.C. Circuit also cited a South Carolina federal court's April 13 decision, which struck down the Final Rule on the grounds that the NLRB exceeded its authority under the Administrative Procedures Act. The decision marked a significant victory for the U.S. and South Carolina chambers of commerce and called into question the obligation of employers nationwide to post the notice. The NLRB has stated that it intends to appeal that decision.

The D.C. Circuit's ruling further delays implementation of the Final Rule, initially set to take effect in November 2011. The NLRB has already pushed back the effective date multiple times due to apparent confusion, resistance to the rule, and pending litigation. Prior to the D.C. Circuit's ruling, it was slated to take effect April 30, 2012.

Oral Argument in September

The D.C. Circuit ordered an expedited briefing schedule for the appeal, and directed the clerk to calendar the case for oral argument in September 2012. As a result, the injunction will remain in place until September, and employers will not be required to post the employee notice poster until then, if at all, depending on the outcome of the appeal. The NLRB has said that its regional offices will not implement the rule pending resolution of the issues before the courts.

Daniel V. Johns is a partner in the Litigation Department, Practice Leader of the Higher Education Group, and a member of the Labor and Employment Group and Health Care Group at Ballard Spahr LLP. Reach him at 215-864-8107 or [email protected]. Geoffrey D. Bruen and Meredith C. Swartz are associates in the firm. Reach them at [email protected] and [email protected] respectively.

On April 17, the U.S. Court of Appeals for the District of Columbia Circuit enjoined the National Labor Relations Board (NLRB) from enforcing a controversial rule that would require most private sector employers covered by the National Labor Relations Act to post a notice advising employees of their rights under the Act.

'Unfair Labor Practice'

The Rule, announced in August 2011, would not only have required that employers post the notice in the workplace, but also provided that failure to do so would be an unfair labor practice that tolls the statute of limitations for any other unfair practices in that workplace.

The request for an injunction, filed by the National Association of Manufacturers (NAM), stems from its appeal of the U.S. District Court for the District of Columbia's March ruling on NAM's challenge to the Final Rule. The district court generally upheld the posting requirement, but ruled that the NLRB went too far when it declared that failure to post is an automatic unfair labor practice, and stayed the statute of limitations for any unfair
practice charges. However, the district court noted that “nothing in [its] decision prevents the [NLRB] from finding that a failure to post constitutes an unfair labor practice in any individual case brought before it,” but that any such finding must be based on the facts and circumstances of each specific case.

While the NLRB opposed a delay in enforcement of the Final Rule pending NAM's appeal, the D.C. Circuit disagreed. In a per curiam opinion, the appellate court noted that the uncertainty about enforcement of the Final Rule weighed in favor of temporarily preserving the status quo pending resolution of the appeal. Of particular significance to the court was the tension between the NLRB's prior position of voluntarily postponing the rule pending litigation, with its current position that the rule should be implemented during the pendency of an appeal. Together with the NLRB's potential appeal of another aspect of the lower court's ruling ' which severed portions of the rule as invalid ' the appellate panel concluded that the tension left enough uncertainty surrounding enforcement of the rule to merit an injunction.

In support of its conclusion, the D.C. Circuit also cited a South Carolina federal court's April 13 decision, which struck down the Final Rule on the grounds that the NLRB exceeded its authority under the Administrative Procedures Act. The decision marked a significant victory for the U.S. and South Carolina chambers of commerce and called into question the obligation of employers nationwide to post the notice. The NLRB has stated that it intends to appeal that decision.

The D.C. Circuit's ruling further delays implementation of the Final Rule, initially set to take effect in November 2011. The NLRB has already pushed back the effective date multiple times due to apparent confusion, resistance to the rule, and pending litigation. Prior to the D.C. Circuit's ruling, it was slated to take effect April 30, 2012.

Oral Argument in September

The D.C. Circuit ordered an expedited briefing schedule for the appeal, and directed the clerk to calendar the case for oral argument in September 2012. As a result, the injunction will remain in place until September, and employers will not be required to post the employee notice poster until then, if at all, depending on the outcome of the appeal. The NLRB has said that its regional offices will not implement the rule pending resolution of the issues before the courts.

Daniel V. Johns is a partner in the Litigation Department, Practice Leader of the Higher Education Group, and a member of the Labor and Employment Group and Health Care Group at Ballard Spahr LLP. Reach him at 215-864-8107 or [email protected]. Geoffrey D. Bruen and Meredith C. Swartz are associates in the firm. Reach them at [email protected] and [email protected] respectively.