Another setback for NLRB’s proposed posting rule

by Brian R. Garrison

Continuing what has been a recent trend, the U.S. Court of Appeals for the District of Columbia Circuit has issued another decision against the National Labor Relations Board (NLRB). On May 7, the court determined the Board’s proposed rule mandating that employers display posters explaining employee rights under the National Labor Relations Act (NLRA) is invalid.

Background
The controversial posting rule was approved by the NLRB in August 2011 and slated to go into effect last year but was put on hold pending appeal. Under the rule, employers were required to post notices “in conspicuous places, informing [employees] of their NLRA rights, together with Board contact information and information concerning basic enforcement procedures.” The NLRB’s proposed notice describes employees’ right to form and join unions, bargain collectively, engage in other activities protected under the NLRA, or refrain from those activities altogether. (The poster didn’t mention employees’ right to decertify a union, not pay union dues in right-to-work states, or object to paying dues unrelated to union representation. The NLRB claimed it was entitled to “editorial judgment.”)

The rule also had stiff consequences for noncompliance. Failure to post the notice would, in and of itself, be deemed an unfair labor practice (ULP), be considered evidence of unlawful motive in any other ULP charge, and toll, or extend, the six-month statute of limitations for filing ULP charges. The NLRB believed the rule was necessary because “employees were not aware of their rights under the [NLRA].” Specifically, the Board cited the fact that only a small portion of the private workforce is unionized and the workforce is increasingly made up of immigrants and workers coming out of high school who are ignorant of their rights under the NLRA.

Court’s decision
Business groups opposed the requirement on several grounds. They argued that the NLRB has no authority to require the posters, the rule created a new ULP that Congress hadn’t intended when the NLRA was passed (namely, not displaying the poster), the rule violated employers’ free-speech rights, and the Board didn’t perform a required analysis of the rule’s effect on small employers. The NLRB maintained that Congress gave it authority to create regulations to fill in gaps in the NLRA. The D.C. Circuit wasn’t persuaded by the NLRB’s arguments.

The court noted that the First Amendment to the U.S. Constitution and Section 8(c) of the NLRA permit employers to freely communicate with employees about unionization as long as their speech doesn’t contain any threats or promise any benefits. In addition, the law allows employers to remain silent on the topic altogether at their discretion. However, under the NLRB’s rule, “the government selected the message and ordered its citizens to convey that message” and then assessed penalties for noncompliance. The court made it very clear that such a mandate is unlawful. Nat’l Ass’n of Mfrs v. NLRB, Nos. 12-5068 and 12-5138.

Bottom line
The NLRB has yet to issue a statement about the decision, so it’s unknown whether the case will make its way to the U.S. Supreme Court. However, the Board is still precluded from implementing the posting requirement. The D.C. Circuit’s decision is a significant development for employers everywhere. When considered in conjunction with another ruling by a federal district court in South Carolina that the NLRB’s proposed rule is invalid, the latest decision by the D.C. Circuit means that employers nationwide have a good-faith basis for refusing to post the notice pending the resolution of these cases.

Brian R. Garrison is an attorney with Faegre Baker Daniels, practicing in the firm’s Indianapolis, Indiana, office. He may be contacted at brian.garrison@FaegreBD.com.