Last year, the U.S. Chamber of Commerce challenged the legality of the NLRB’s notice posting rule in federal court in South Carolina. Yesterday, Judge David C. Norton found (pdf) that the NLRB did not have the authority to issue the notice posting rule and that it was, therefore, unlawful under the Administrative Procedure Act.
Judge Norton reasoned that the notice posting rule was not "necessary to carry out" the NLRA because there is no provision in the NLRA itself that requires any type of notice posting. He also found that the overall structure of the NLRA contemplates that the NLRB will serve a reactive function, responding to charges or petitions filed by others. The notice requirement constituted a proactive attempt to dictate employer conduct prior to the filing of any such charge or petition. Finally, Judge Norton found that Congress did not intend to give the NLRB the power to require a notice posting. The NLRA, unlike other labor legislation enacted around the same time and since, does not contain a provision requiring employers to post a notice of the rights afforded under the statute.
With Judge Norton’s ruling, labor professionals are faced with conflicting rulings from two federal judges. The District of Columbia decision is currently on appeal, and the court of appeals has been asked to stay the ruling of the district court judge in that case pending appeal. The NLRB will likely appeal the South Carolina decision as well. Thus, litigation over the rule will continue.
Whether the NLRB, in light of the South Carolina decision and the continuing litigation, will voluntarily delay the effective date of the notice posting rule is yet to be seen. To be sure, the NLRB has already delayed the effective date on prior occasions even before the District of Columbia and South Carolina decisions were issued. If the NLRB does so, or as any additional developments occur, this blog will cover them.