Court Upholds Most of the NLRB’s Union Rights Poster Rule

Troutman Sanders LLP law firm reports that last week a federal judge rejected a challenge to the controversial rule issued last year by the National Labor Relations Board (“NLRB” or “Board”) that will require employers to display posters informing workers about their rights to form or join a union.  (You can find our past analysis of this rule here.)  The National Association of Manufacturers and other business interests filed a lawsuit challenging the rule as beyond the Board’s authority under the National Labor Relations Act (“NLRA”).  The Board’s rule was originally scheduled to take effect on January 31, 2012, but after the lawsuit was filed, the effective date was pushed back to April 30, 2012.  In addressing the challenge to the rule, the Court upheld the posting requirement, finding that the Board was authorized to issue the rule under the Board’s rule-making authority to effectuate the purposes of the NLRA.  According to the Court, the NLRB is authorized to issue the posting requirement rule unless some provision of the NLRA limits the Board’s authority, and those challenging the rule failed to identify any sufficiently limiting provision.

However, in its ruling the Court did invalidate a key provision of the rule, which would have deemed an employer’s failure to display the poster an automatic unfair labor practice.  The Court struck down this “blanket advance determination” approach, noting that the NLRA specially defines limited activities that constitute an unfair labor practice.  So, while under a given set of facts the failure to post the notice could be an unfair labor practice, this ruling means that is not automatically the case.  The Court did uphold the rule’s provision that a failure to post the notice can be deemed evidence of anti-union animus when an employer’s motive is at issue in an unfair labor practice proceeding.

Ultimately, this decision is a “win” for the NLRB and for organized labor.  The Court upheld the critical pieces of the posting requirement rule, which employers must follow starting on April 30 (unless this decision is appealed and the Court delays the rule pending the outcome of the appeal).  While the failure to display a union rights poster will not automatically constitute an unfair labor practice, other problems can follow an employer’s failure to follow the rule, as noted above. 

Expect to see more guidance on this issue as the rule becomes effective in less than two months.  Some employers will inevitably fail to meet the rule’s requirements, which will cause the NLRB to refine its position on the consequences of violations.  This summary is provided by attorneys Gene Webb, Evan Pontz and Brandon Dhande of the Troutman Sanders LLP Labor & Employment Group.