In a groundbreaking opinion, the District of Columbia Court of Appeals has ruled that three appointments of officers to the National Labor Relations Board (the “Board” or the “NLRB”) by President Barack Obama were unconstitutional because they lacked the “Advice and Consent” of the Senate and were not authorized by the Constitution’s so-called Recess Appointments Clause. As a result, the Court vacated the underlying Board decision that gave rise to the appeal, concluding that the NLRB had no authority to issue the decision because only two of its five members were validly appointed. Thus the Board lacked the quorum necessary for it to take action. The ruling has widespread implications for the NLRB as well as the President’s overall “recess appointment” powers.

The Court’s decision, Noel Canning v. NLRB, No. 12-1115 (D.C. Cir. Jan. 25, 2013), arguably invalidates hundreds of opinions rendered by the Board this past year. Some of these decisions have been controversial, such as the Board’s recent decision that seemingly innocuous language found in employment policies unlawfully restrains workers’ rights to unionize. And the Canning decision may end the longstanding Presidential practice of appointing government officers, like Board Members, when the Senate is not on a formal recess in between Senate sessions.

Notably, the Noel Canning decision is at odds with a decision by the Eleventh Circuit Court of Appeals in 2004 upholding President George W. Bush’s appointment of a federal judge during an intra-session Senate break. The circuit split virtually guarantees that the Board will ask the Supreme Court to weigh-in. NLRB Chairman Mark Gaston Pearce issued a press release within hours of the decision in Noel Canning, announcing that the Board “respectfully disagrees” with the decision, and “believes that the President’s position in the matter will ultimately be upheld.” The Chairman made clear that the NLRB will continue to issue decisions (although it has no power to do so according to the Court in Noel Canning).

The President’s Appointments

On January 4, 2012, the President filled three Board vacancies purportedly by “recess appointment.” The Senate was on a break when the President made the appointments, but was not in formal recess between Senate sessions, when the Senate is unavailable to receive and act upon the President’s nominations of officers. The vacancies filled by the President had occurred in the preceding year-and-a-half, when the Senate was also not in formal recess.

The Constitutional Provisions at Issue

The Appointments Clause provides that the President “shall nominate, and by and with the Advice and Consent of the Senate, shall appoint…Officers of the United States,” which process includes the appointment of NLRB members. The provision commonly referred to as the “Recess Appointments Clause” adds that, “[t]he President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their Next Session.”

The Canning Decision

In Noel Canning, 358 NLRB No. 4 (Feb. 8, 2012), the Board had ruled that the employer violated the National Labor Relations Act by failing to draft and execute a collective bargaining agreement that the union alleged the parties had reached during their last bargaining session. On appeal, the employer challenged the NLRB’s decision on both statutory and constitutional grounds. Although the Court of Appeals rejected the employer’s arguments that the Board’s decision was not supported by the evidence and ran afoul of contract law principles, the Court agreed with the employer that the Board lacked the authority to issue its decision in the first place, because only two NLRB members were validly appointed. Absent a quorum of at least three Board members, the Board has no power to act, as the Supreme Court has recently made clear.

The Court’s decision turned on a painstaking analysis of the phrase in the Recess Appointments Clause: “that may happen during the Recess of the Senate.” First, the Court reasoned that “the Recess” referred to in this clause means the time between Senate sessions when the Senate is unavailable to receive and act upon the President’s nominations, as opposed to mere intra-session breaks. The Court emphasized that the framers of the Constitution used the definitive article “the” before the word “Recess,” evidencing that they were contemplating the formal break between Senate sessions, and not merely an “adjournment.” The Court relied upon contemporaneous writings from the time the Constitution was drafted as well, and highlighted that no President even attempted an intra-session appointment for the first 80 years of the country’s existence, further demonstrating that the authors of the Constitution did not intend such appointments. The Court buttressed its interpretation by reasoning that to uphold the appointments in question would effectively eviscerate the fundamental constitutional principle of separation of powers explicitly found in Appointments Clause’s requirement that the Senate approve presidential nominations. The President could simply bypass Senate approval by waiting for a Senate break to make appointments.

Additionally, the Court determined that the Recess Appointments Clause authorizes the President to fill only those vacancies that actually occur during a formal recess of the Senate. The Court reasoned that a contrary interpretation would render superfluous the Clause’s “that may happen” language. Here, the Court looked to contemporaneous writings from the time the Constitution was written that used the word “happen,” including dictionaries that explain the word “happen” requires an action. The Court also noted there is evidence that the nation’s founders interpreted the word “happen” to mean “arise,” including George Washington in his interpretation of the Senate Vacancies Clause. Here, too, the Court noted that, absent its interpretation, the President could delay making appointments until the Senate went into formal recess, thereby avoiding the need for Senate approval and skirting the separation of powers contemplated by the Appointments Clause.

Now What?

As noted, the Board most likely will seek Supreme Court review of the Canning decision. And, based upon the NLRB’s press release, the Board will continue acting on the assumption that the Supreme Court will uphold the appointments at issue. But, should the Supreme Court affirm the Noel Canning decision, hundreds of Board decisions may be invalidated. This, of course, will not be anything new for the Board recently, which has been down this road once before. In 2010, the Supreme Court invalidated hundreds of Board decisions that were rendered by only two Board members. The Board had to re-decide many cases, creating a backlog that took well over a year to clean up.

For now, however, it may be an employer’s best bet to adhere to the Board’s recent rulings pending future developments in the Supreme Court. Please feel free to contact an attorney in the Gibbons Employment & Labor Law Department for answers to questions regarding a case pending before the Board, a decision the NLRB issued against your company this past year, or to help you navigate your options in light of the Noel Canning decision.

James J. La Rocca is an Associate in the Gibbons Employment & Labor Law Department.