Federal labor board has been much more pro-worker under Biden. Employers want courts to end that

Originally Published: 23 APR 24 08:28 ET

Updated: 23 APR 24 13:06 ET

By Chris Isidore and John Fritze, CNN

Washington, DC (CNN) — Starbucks and the National Labor Relations Board, the federal agency charged with protecting workers’ rights, will battle each other before the Supreme Court Tuesday, in one of numerous cases now pending in which major employers are questioning the NLRB’s powers and even its right to exist.

The NLRB under the labor-friendly Biden administration has been overseeing a period of significantly more organizing and strike activities by the nation’s unions. Some high-profile companies are complaining that the agency is abusing its powers. The companies are asking federal courts, often with conservative, pro-business judges, to stop the agency from standing behind the more activist unions now making their lives more difficult.

Tuesday’s Supreme Court case involves the NLRB’s powers to get employees whom it judges were wrongly fired for union activity immediately rehired, rather than forcing them to go through a long, drawn-out court process. At issue are seven employees Starbucks fired at a store in Memphis in 2022 that the union said were attempting to organize. The employees, known as the “Memphis 7,” have become a nationwide symbol for labor supporters.

Starbucks is arguing that the NLRB’s powers are not being applied uniformly across the country because some federal courts, including the courts that reviewed the Memphis 7 case, are using what critics describe as a more lenient standard to force employers to take preliminary action. In this case, the lower courts required Starbucks to reinstate the employees it had fired.

“The NLRB has long used the federal courts … to obtain injunctions … before the merits of an unfair labor practice case are fully evaluated,” said a statement from Starbucks. “As a company, we felt obligated to stand up for what is right, not only for our partners and our company, but also for the employers across the country who are subject to NLRB requests for injunctions in federal courts.”

But the NLRB argues that the only way to protect workers who are improperly terminated for union activity is to allow it to go to federal court and get immediate action against the offending employer, as it successfully did in the case of the Memphis employees.

“Injunctive relief is one of the most important tools available to the NLRB to protect workers’ statutory rights through effective enforcement of the only federal labor law in the country,” said Jennifer Abruzzo, the NLRB’s General Counsel, in a statement about the case.

“Congress … has empowered the agency to seek this interim relief to immediately end violative conduct and restore the status quo at the workplace while the board’s administrative process proceeds,” Abruzzo said. “Without obtaining this temporary relief, the lawbreaker will fully reap the benefits of having violated workers’ rights — such as by snuffing out a nascent organizing drive — through the passage of time.”

Justices’ tough questions for the NLRB

During arguments Tuesday, Starbucks’ attorney argued that the NLRB has too much power to get an injunction to order fired workers returned to work, without the district court getting to weigh evidence in the case itself.

“Preliminary injunctions are extraordinary and drastic remedies,” said Lisa Blatt, a veteran Supreme Court litigator and Starbucks’ attorney in the case. “Such relief is highly inappropriate absent a clear showing.”

Justice Ketanji Brown Jackson questioned how the NLRB could be abusing its powers, as Starbucks was arguing, given that there had been only 14 instances of the board seeking such injunctions in the last year out of the thousands of cases it considered.

“If we’re worried about an abusive board doing things it’s not supposed to be [doing], giving undue deference, it seems like the board is pretty careful when it’s determining whether or not to even seek these injunctions since it’s only asked for it 14 times,” she said.

But both conservative and liberal justices posed tough questions to the government, pressing the Biden administration’s attorney on why lower courts should review labor cases any differently than other controversies involving government agencies.

“The district court is an independent check,” conservative Justice Amy Coney Barrett said. “So, it seems like it should be just doing what district courts do.”

Justice Elena Kagan, a member of the court’s liberal wing, appeared to agree, suggesting that lower federal courts should do “what courts normally do, which is applying the law as the court finds it to a case.”

Those questions appeared to cut against the arguments raised by the government that courts should give some special deference to the NLRB’s read on a dispute between employers and employees.

Justice Neil Gorsuch, a conservative member of the court, pointed out that “in all sorts of alphabet soup agencies, we don’t do this. District courts apply the likelihood of success test as we generally perceive it. So why is this particular statutory regime different from so many others?”

And Chief Justice John Roberts suggested that attorneys for both the government and Starbucks could agree, “we can dispose of this in a short opinion,” prompting laughter in the courtroom.

The labor law that controls what happens if an employer illegally fires a worker for supporting a union doesn’t give the workers much in the way of relief. The employer could be forced to provide back pay for the time since the improper firing, but that amount would be reduced by whatever pay the worker received at a job they held in the meantime. The employer doesn’t have to pay any interest, penalty or fine, to the fired workers, their union or the agency.

“The remedies against the employer are so pathetically weak they’re almost an invitation to violate the law,” said Cathy Creighton, an NLRB attorney during the Clinton administration and a union lawyer who now serves as the head of the Buffalo, New York office of Cornell University’s school of Industrial and Labor Relations.

While this is the first such case to reach the Supreme Court, other cases are emerging in which some high profile employers are challenging the agency’s right to exist. The Supreme Court’s decision is expected by the end of June.

Other challenges to NLRB

Rocket company SpaceX filed two federal lawsuits so far this year questioning the constitutionality of the agency itself after the NLRB announced it was looking at complaints from eight former employees of the nonunion rocket company who said they were fired for writing company management begging them to publicly condemn CEO Elon Musk’s “harmful” behavior on social media.

Three other companies — Starbucks, Amazon and Trader Joe’s — have raised similar arguments in cases still before the NLRB’s administrative law judges, although they have not taken the case to federal court as SpaceX has done and have not joined its suit.

The constitutionality of the NLRB was upheld by the Supreme Court in 1937, two years after the agency was created during the New Deal, said Cornell’s Creighton.

She said the Supreme Court’s rulings with the current conservative majority on some other cases involving unions makes her worried that it is poised to rule against the agency on this case. And she’s also worried that if the question of constitutionality of the NLRB were to reach the high court, it could rule against the agency as well.

“They’re seeking to annihilate the board,” she said about the employers’ challenges to the NLRB. “I’m worried because this court is not ruled by precedent the way other courts have been. Just taking up the issue, they’re signaling they’re not particularly labor friendly.”

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