On April 13, 2012, a federal court in South Carolina held that the National Labor Relations Board lacked authority to issue its notice-posting rule.
Executive Summary: On April 13, 2012, a federal court in South Carolina held that the National Labor Relations Board lacked authority to issue its notice-posting rule. The South Carolina court's decision conflicts with an earlier decision by a federal trial court in D.C., which upheld the Board's authority to issue the rule. The South Carolina court did not enjoin enforcement of the notice-posting rule; thus, it technically still takes effect April 30, 2012. In light of the conflicting court decisions and the uncertainty surrounding whether the South Carolina court will enjoin enforcement of the rule, however, we recommend you consult with legal counsel before making a decision not to post the notice. Additionally, because publicity surrounding the notice-posting rule and court decisions interpreting it likely will result in questions from employees regarding the rule and the company's position on unions, employers should take steps now to educate their supervisors on how to answer these questions.
As discussed in our August 30, 2011 Legal Alert, NLRB to Require Posting of Notice of Employee Rights, available at http://www.fordharrison.com/shownews.aspx?Show=7546, the Board's notice-posting rule requires employers covered by the NLRA to post a Notice of Employee Rights Under the National Labor Relations Act "in conspicuous places where [it] is readily seen by employees, including all places where notices to employees concerning personnel rules or policies are customarily posted." The notice requirement does not apply to employers who are not covered by the NLRA, including, among others, any person subject to the Railway Labor Act, as well as entities over whom the Board has been found not to have jurisdiction or over which the Board has chosen not to assert jurisdiction.
In Chamber of Commerce v. National Labor Relations Board (April 13, 2012), the court held that the plain language and structure of the NLRA compel a finding that the Board lacks authority under Section 6 of the Act to promulgate the notice-posting rule. The court held that the "notice-posting rule contradicts both the plain meaning of Section 6 and the balance achieved by the statutory framework [of the NLRA]." Noting that neither Section 6 nor any other section of the NLRA "even mentions the issue of notice posting," the court held that the rule is not necessary to carry out any provision of the Act. Further, in light of the statutory scheme, legislative history, history of evolving congressional regulation in the area, and other federal labor statutes, the court found that "Congress did not intend to impose a notice-posting obligation on employers, nor did it explicitly or implicitly delegate authority to the Board to regulate employers in this manner."
The court did not, however, issue an injunction prohibiting the Board from enforcing the notice-posting requirement. In March, a federal court in D.C. upheld the notice-posting requirement, but held that the penalty provisions of the rule are invalid. The plaintiffs in that case have asked the D.C. Court of Appeals to enjoin the notice posting requirement while the court considers their appeal. The court's decision in Chamber of Commerce may make it more likely that the Court of Appeals will grant this request.
Employers' Bottom Line: We will continue to keep you updated regarding the status of the notice-posting rule. In light of the publicity surrounding the notice posting rule and court decisions interpreting it, employers should educate their supervisors on how to answer questions they are likely to get from employees.
If you have any questions regarding this Alert or would like assistance in developing a strategy for educating supervisors on how to handle questions regarding the rule, please contact the Ford & Harrison attorney with whom you usually work.