17 June 2024 • 3 minute read
US Supreme Court reels in National Labor Relations Board, heightens required showing for injunctive relief
On June 13, 2024, the Supreme Court issued a significant labor law decision holding that the National Labor Relations Board (NLRB) must satisfy the traditional equitable criterion when petitioning federal district courts for injunctive relief under Section 10(j) of the National Labor Relations Act (NLRA). Starbucks Corp. v. McKinney, No. 23-367, *1 (June 13, 2024).
Significantly, the Court held the NLRB must show it is “likely to succeed on the merits.” In addition, courts need not “yield to the Board’s preliminary view of the facts, law, and equities.”
Section 10(j) of the NLRA
The NLRB’s authority to seek injunctive relief is grounded in Section 10(j) of the NLRA. It provides that federal district courts may “grant to the Board such temporary relief . . . as it deems just and proper.” Such relief is intended to preserve the status quo as it existed prior to an employer’s commission of alleged unfair labor practices. For example, the NLRB commonly uses Section 10(j) petitions for injunctive relief as a tool to restore the status quo during union organizing drives. The NLRB will often seek, for example, immediate reinstatement of employees who allegedly were terminated because they supported a union. The purpose of such relief is to capture the moment in time where employees might be inclined to discontinue organizing efforts, fearing possible reprisals.
The Court’s decision
This decision resolved a circuit split, under which some circuits applied a more relaxed standard, requiring only that the NLRB demonstrate “reasonable cause to believe that unfair labor practices have occurred” for the petition to be granted. Moving forward, the NLRB will no longer enjoy such generous deference.
Applying this lower standard, in Starbucks, the Sixth Circuit affirmed the district court’s decision ordering Starbucks to reinstate several baristas who allowed the news media to enter a store after hours, at which time the baristas announced their intent to unionize. The NLRB claimed that the terminations were grounded in pretext, and that the real reason Starbucks terminated them was due to their support for the union. Starbucks said the district court and Sixth Circuit gave the NLRB too much deference, and applied a test that was unsupported by the NLRA. The Supreme Court agreed.
In reaching its decision and ordering remand, the Court in Starbucks significantly heightened the NLRB’s burden of proof and, in so doing, removed a powerful tool from the NLRB’s arsenal, namely, threatening to steamroll over employers with costly threats of injunctive relief, without demonstrating a likelihood of success on the merits in underlying administrative proceedings.
As big a win as Starbucks is for employers, employers who face unionization risk are encouraged to remain vigilant. DLA Piper’s Labor Group has substantial experience assisting employers with the penumbra of issues that continue to arise under the NLRA, and the current administration’s attempts to broaden the scope of the NLRA well beyond what the drafters ever envisioned.
Employers faced with threats of unionization, or who already are in the throes of an organizing campaign and facing difficult employee disciplinary decisions, are encouraged to consult with counsel in order to take such prophylactic measures as necessary to minimize the risk of 10(j) injunction proceedings.
For more information, please contact the authors.
Significantly, the Court held the NLRB must show it is “likely to succeed on the merits.” In addition, courts need not “yield to the Board’s preliminary view of the facts, law, and equities.”
Section 10(j) of the NLRA
The NLRB’s authority to seek injunctive relief is grounded in Section 10(j) of the NLRA. It provides that federal district courts may “grant to the Board such temporary relief . . . as it deems just and proper.” Such relief is intended to preserve the status quo as it existed prior to an employer’s commission of alleged unfair labor practices. For example, the NLRB commonly uses Section 10(j) petitions for injunctive relief as a tool to restore the status quo during union organizing drives. The NLRB will often seek, for example, immediate reinstatement of employees who allegedly were terminated because they supported a union. The purpose of such relief is to capture the moment in time where employees might be inclined to discontinue organizing efforts, fearing possible reprisals.
The Court’s decision
This decision resolved a circuit split, under which some circuits applied a more relaxed standard, requiring only that the NLRB demonstrate “reasonable cause to believe that unfair labor practices have occurred” for the petition to be granted. Moving forward, the NLRB will no longer enjoy such generous deference.
Applying this lower standard, in Starbucks, the Sixth Circuit affirmed the district court’s decision ordering Starbucks to reinstate several baristas who allowed the news media to enter a store after hours, at which time the baristas announced their intent to unionize. The NLRB claimed that the terminations were grounded in pretext, and that the real reason Starbucks terminated them was due to their support for the union. Starbucks said the district court and Sixth Circuit gave the NLRB too much deference, and applied a test that was unsupported by the NLRA. The Supreme Court agreed.
In reaching its decision and ordering remand, the Court in Starbucks significantly heightened the NLRB’s burden of proof and, in so doing, removed a powerful tool from the NLRB’s arsenal, namely, threatening to steamroll over employers with costly threats of injunctive relief, without demonstrating a likelihood of success on the merits in underlying administrative proceedings.
As big a win as Starbucks is for employers, employers who face unionization risk are encouraged to remain vigilant. DLA Piper’s Labor Group has substantial experience assisting employers with the penumbra of issues that continue to arise under the NLRA, and the current administration’s attempts to broaden the scope of the NLRA well beyond what the drafters ever envisioned.
Employers faced with threats of unionization, or who already are in the throes of an organizing campaign and facing difficult employee disciplinary decisions, are encouraged to consult with counsel in order to take such prophylactic measures as necessary to minimize the risk of 10(j) injunction proceedings.
For more information, please contact the authors.
