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Court Holds NLRB Notice-Posting Rule Violates Employers’ Free Speech Rights

May 9, 2013

As we previously reported, the National Labor Relations Board (NLRB) issued a rule in late August 2011, which would have required most private-sector employers to post a notice describing employees’ rights (the Notice-Posting Rule) under the National Labor Relations Act (NLRA). For more information regarding that rule, please refer to Honigman’s earlier Labor Alert regarding the matter by clicking here

Although it was originally scheduled to take effect on November 14, 2011, the Notice-Posting Rule drew heavy criticism from business organizations and ultimately legal challenges. In April 2012, the U.S. Court of Appeals for the D.C. Circuit issued a decision, National Ass’n of Mfrs. v. NLRB, which indefinitely delayed the rule’s implementation until such time as that court could consider the merits of the challenge. For more information on the details of the delays and the legal challenges, click below to read Honigman’s earlier Labor Alerts regarding these matters. Honigman Labor and Employment Alerts - October 12, 2011; January 5, 2012; and April 17, 2012.

On May 7, 2013, the D.C. Circuit held that the Notice-Posting Rule is invalid because it violates employers’ free speech rights under section 8(c) of the NLRA, which prohibits the NLRB from finding that employer speech which contains no threat of reprisal or force or promise of benefit constitutes evidence of an unlawful labor practice. The D.C. Circuit found that employers’ free speech rights were violated by the portions of the Notice-Posting Rule that made it an unlawful labor practice to refuse or fail to post the notice and that provided the refusal to post could be considered evidence of an employer’s unlawful motive. National Ass’n of Mfrs. v. NLRB, (D.C. Cir. May 7, 2013). The Court also found invalid the Notice-Posting Rule provision that the six-month statute of limitations found in section 10(b) of the NLRA was tolled if an employer failed to post the notice concluding it was contrary to the intent of Congress. The D.C. Circuit vacated the Notice-Posting Rule in its entirety. The Court reached its decision notwithstanding the uncertainty surrounding the NLRB’s authority to act in light of President Obama’s recess appointments to that agency; an issue likely to be decided by the U.S. Supreme Court. The D.C. Circuit concluded that the NLRB had a lawful quorum when the final Notice-Posting Rule was signed in August 2011.

Another legal challenge to the Notice-Posting Rule remains pending. On April 13, 2012, the U.S. District Court for the District of South Carolina held that the NLRB exceeded its authority in adopting the rule. Chamber of Commerce of the United States v. NLRB (D.S.C. April 13, 2012). The NLRB has appealed that ruling to the U.S. Court of Appeals for the Fourth Circuit with a decision yet to be issued by that court.

Honigman will continue to keep you informed about developments concerning the Notice-Posting Rule. If you have any questions regarding this important issue, please contact one of our Labor and Employment Department attorneys.