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D.C. Federal District Court Overturns NLRB Quickie Election Rule; Leaves Questions for Employers

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May 15, 2012

By Doug Hass

Yesterday, the U.S. District Court for the District of Columbia issued a ruling on the U.S. Chamber of Commerce’s challenge to the National Labor Relations Board’s (NLRB) quickie election rule that technically took effect on April 30.  District Judge James E. Boasberg handed the NLRB its second major defeat in the past two weeks.  Holding that “the quorum requirement…is no trifle,” he ruled that the NLRB failed to approve the quickie election rule with a quorum, and that the new rule was therefore invalid.

The Quickie Election Rule

In June 2011, the NLRB proposed new changes to procedures governing union elections under the National Labor Relations Act.  The NLRB’s proposed changes to its election procedures drew a tsunami of comments from the labor and business communities and led to a nasty public disagreement among NLRB members.  Despite the public outcry, and with the two Democratic Members apparently acting largely without the participation of Republican Member Brian Hayes, the NLRB announced in December 2011 that it would issue a scaled-down version of the hotly debated changes. 

Under the quickie elections rule, employers would face representation elections more quickly, and would have far fewer opportunities to challenge any problems with the election process. The Board asserted that the quickie elections rule was “intended to eliminate unnecessary litigation, delay, and duplicative regulations.” However, opponents of the rule, including Member Hayes, suggested that the rule was partisan and merely intended to speed up the union election process while limiting employers’ ability to participate in it.  As we noted in a recent alert, as the Board prepared to implement the new rule, the Acting General Counsel released a set of guidelines and Frequently Asked Questions further clarifying the significant acceleration in election procedures that employers would face.

The Chamber of Commerce’s Lawsuit

Shortly after the NLRB’s announcement, the Chamber of Commerce and the Coalition for a Democratic Workplace filed a lawsuit in the D.C. district court alleging a host of violations.  The lawsuit sought to enjoin the Board from enforcing the new rule, and requested that the Court issue a declaratory judgment that the rule was invalid.  Joined by numerous amicus supporters, the challengers contended that the Board passed the rule without a proper quorum and that the rule violated the National Labor Relations Act, the Administrative Procedure Act, the Regulatory Flexibility Act, and the First and Fifth Amendments to the United States Constitution.

The challengers emphasized, among other issues, that the rule “curtails an employer’s right to communicate with its employees by substantially shortening the election period.”  Other arguments stressed that pre-election issues historically had been addressed in a pre-election hearing, such as single vs. multiple sites, manager and confidential classification issues, independent contractor issues and clerical issues.  Under the new rule, the challengers argued, these important discussions might not take place.

In addition, the Chamber and its supporters argued that the final rule essentially eliminated the parties’ right to file post-hearing briefs, and impermissibly prohibited pre-election consideration of supervisory status issues, which could lead to frequent elections where supervisory status issues were left unaddressed, affecting both employers and unions.

The District Court’s Opinion

Judge Boasberg agreed with the Chamber’s arguments.  The Court noted that while Member Hayes had participated in earlier votes on drafts of the final rule, Member Hayes did not vote or even participate in the Board’s vote on the final version, depriving the Board of a quorum.  Judge Boasberg held that “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.”  Quoting Woody Allen, Judge Boasberg found that Member Hayes “had to at least show up.”  While the Court recognized that its “decision may seem unduly technical,” it cited the Supreme Court’s past decisions as establishing that the quorum requirement “is no trifle.”

However—and importantly for employers—the Court did not finally decide the issue.  Because Judge Boasberg found that the Board had passed the quickie election rule without the required quorum, he declined to rule on the merits of the Chamber’s challenge itself.  The opinion explicitly states that it “does not reach – and expresses no opinion on – Plaintiffs’ other procedural and substantive challenges to the rule.”

What Happens Now?

As the Court noted, “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.”  The NLRB has not yet commented on the impact of Judge Boasberg’s ruling or whether it will seek to vote again on the quickie election rule with the Board’s current composition.  In the meantime, though, the Court held that “representation elections will have to continue under the old procedures.”

It may take a period of time before we learn for sure whether the district court’s ruling is more than a temporary reprieve for employers. We will continue to monitor developments in this case as it moves to the appellate stage and will monitor the NLRB’s position on this issue and provide further guidance as appropriate.

In the meantime, if you have any questions or would like to discuss the quickie election rule in greater detail, please contact Doug Hass, Chris Johlie or Amy Zdravecky.

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