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When silence speaks volumes: divergent interpretations of the NLRB’s rulemaking authority

April 26, 2012

If the National Labor Relations Board (NLRB) hopes to fully implement its recent notice posting rule regarding collective bargaining rights, it will likely need to convince two United States Courts of Appeal that it has the legal authority to create such a requirement. One key argument will revolve around Congress’ silence in the National Labor Relations Act (NLRA) regarding the NLRB’s ability to proactively require employers to take certain actions, such as display aposter informing employees of their collective bargaining rights.

As we mentioned in our Apr. 17 post, the United States Court of Appeals for the District of Columbia Circuit temporarily enjoined the NLRB’s notice posting rule. Further, the NLRB has “voluntarily” postponed implementation of the notice posting rule, meaning that employers no longer have to post the notice by Apr. 30 – that is, until the Court of Appeals issues a final decision (oral argument will be scheduled for some time in Sept. 2012).

This appeal is based on a case initiated by the National Association of Manufacturers (NAM) in the United States District Court for the District of Columbia. The court ruled that the NLRB has legal authority to issue the notice posting rule. The District Court, however, also held that the NLRB exceeded its authority by creating a new unfair labor practice for failure to post the notice and in attempting to toll the statute of limitations whenever an employer failed to post the notice.

In a separate case filed by the South Carolina Chamber of Commerce in the United States District Court for the District of South Carolina, that court held that the NLRB lacked authority to issue the notice posting rule.

The contradictory outcomes can be “explained” by looking at each court’s interpretation of the NLRA, which created the NLRB and granted it limited powers to adjudicate certain cases and to create limited rules and regulations.  Specifically, both courts reviewed the language of Section 6 of the NLRA, which gives the NLRB “authority . . . to make, amend, and rescind[] . . . such rules and regulations as may be necessary to carry out the provisions of [the NLRA].” 

In the NAM Case, the court interpreted the NLRA to give the NLRB authority to enact rules addressing any of the NLRA’s provisions, including the provisions of Section 1. Section 1 of the NLRA, the court explained, states our national policy encouraging and protecting collective bargaining rights. Since employees must know their rights to effectively exercise them, the court reasoned that requiring employers to inform employees of their rights “furthers the purposes of the Act.” Stating that “plaintiffs read too much into Congress’ silence on the subject,” the court rejected NAM’s argument that Congress’ failure to expressly grant the NLRB the power to require a notice to employees evinces Congress’ prohibition of such a notice.

In the South Carolina case, on the other hand, the court interpreted the same language narrowly, focusing on whether the NLRB’s posting requirement was “necessary to carry out” any provision of the NLRA. The court noted that, while the posting requirement would be useful in furthering the goals of Section 1 of the NLRA, it was not “necessary” to implement any provision of the NLRA. In addition, the court noted that the NLRB’s function is mainly reactionary, meaning that it does not have the ability to regulate employers without a complaint being filed against an employer. The notice requirement, therefore, proactively attempts to regulate employers and runs contrary to the NLRB’s “reactive role under the Act.” As for Congress’ silence regarding notification to employees of their rights under the NLRA (unlike other federal labor statutes), the court stated that the NLRB “should have heeded the admonition of Simon & Garfunkle [sic]:  ‘And no one dared / disturb the sound of silence.'”

The NLRB will likely appeal the result in the South Carolina case to the Court of Appeals for the Fourth Circuit. Thus, the NLRB will need to convince two Courts of Appeal that Congress’ silence regarding employee notification actually means that Congress intended to give the NLRB authority to require the notice posting. A tall task indeed, but split decisions on the issue could lead to a bigger fight before the Supreme Court.

Stay tuned (silently) for additional developments . . .


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