Fourth Circuit Follows D.C. Circuit’s Lead in Striking Down NLRB Notice Posting

In a recent unanimous decision, the United States Court of Appeals for the Fourth Circuit became the second appellate court to reject the National Labor Relation Board’s (“NLRB”)  notice posting requirement, under which employers had to display a poster informing employees of their rights to organize a union; form, join, or assist a union; bargain collectively through representatives; discuss wages, benefits, and union organizing; take action with others regarding working conditions; strike or picket; or choose not to engage in any of these activities.  The court held that the notice fell outside the scope of the NLRB’s authority in that it affirmatively required employers to educate employees about federal employment law.

Last month, Benesch served as lead counsel to the National Association of Manufacturers in a case where the D.C. Circuit ruled that the regulation violated employers’ free speech rights under Section 8(c) of the National Labor Relations Act (“NLRA”).  Avoiding the First Amendment argument, the Fourth Circuit instead held that the NLRB’s proper role is limited to investigating unfair labor practice charges and conducting union representative elections, and does not include “proactive rulemaking.”  The court explained that only when an employer has been found to have violated its employees’ rights may the NLRB impose subsequent preventative measures upon the employer.  The regulation, which penalized employers who failed to follow the posting procedure by categorizing it as an unfair labor practice, was therefore in conflict with the NLRB’s “reactive nature.”

This latest development in the ongoing litigation only heightens speculation as to whether the NLRB will eventually appeal the D.C. Circuit case to the Supreme Court.  It appears the NLRB might first try its hand at getting the D.C. Circuit to consider rehearing the decision en banc; any petition to the Supreme Court would then have to be filed within ninety days of either the D.C. Circuit’s denial of rehearing or its subsequent entry of a new judgment.  An unfavorable Court ruling could have lasting implications by keeping the NLRB’s regulatory power under the NLRA very narrow.  Alternatively, maintaining the status quo opens the door for other appellate circuits to make their own determinations on the regulation’s legality.  Whichever course the NLRB takes, the posting requirement is likely to remain a high-profile issue for the foreseeable future.

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