Employers Can Breathe a Sigh of Relief: D.C. Circuit Invalidates NLRB’s Controversial “Notice Rule”

On May 7, 2013, the U.S. Court of Appeals for the District of Columbia Circuit invalidated the controversial rule recently promulgated by National Labor Relations Board (the “Board”).  The August 30, 2011 “Notice Rule” is formally known as the “Notification of Employee Rights under the National Labor Relations Act.”  The Rule would have required all employers subject to its provisions to post notices to employees informing them of their rights under the National Labor Relations Act (the “Act”).  An employer’s failure to comply with the rule’s provisions could have resulted in a finding against the employer of unfair labor practices or could have been used as evidence of the employer’s “anti-union animus.”  An additional enforcement mechanism included the ability to suspend the statute of limitations in certain circumstances to allow employees more time to file a charge.

Not surprisingly, many trade associations filed complaints around the country to invalidate the mandatory posting rule.  The D.C. Circuit’s opinion in National Association of Manufacturers v. National Labor Relations Board, et al. is the first appellate decision to strike down the rule.  The Court held that all three of the Notice Rule’s enforcement mechanisms were invalid, as they were contrary to the Act.  Although the Court did not decide the question of the Board’s rulemaking authority, it did raise concerns about whether the Board should ever have authority to issue such rules, stating that “[t]he Board’s [issuance of this Notice Rule] departs from its historic practice.”  Thus, this decision raises significant doubts about the Board’s ability to implement other rules in the future.

For the time being, the Court’s decision means that employers will not need to post  notice informing employees of their rights under the Act.  This is a big victory for the nearly 6 million employers that would have been subjected to the mandatory posting requirements under the Board’s Notice Rule.

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