Third Circuit Deems NLRB “Recess Appointments” Unconstitutional

On May 16, 2013, in NLRB v. New Vista Nursing & Rehab., a divided panel of the Court of Appeals for the Third Circuit joined the D.C. Circuit in holding that the Recess Appointments Clause of the Constitution allows the President to make “recess appointments” (that is, without the advice and consent of the Senate) only when the Senate is on a formal intersession recess, as opposed to an intra-session break. Both the Third Circuit’s decision and the D.C. Circuit’s recent decision in Noel Canning v. NLRB (as elaborated upon in Nat’l Ass’n of Mfrs. v. NLRB) arise from actions taken by the National Labor Relations Board (the “Board” or the “NLRB”) some of whose members had been appointed during an intra-session break. To summarize: (1) at least three Board members must participate in a Board decision; (2) according to these courts, the Board has not had three validly-appointed Members since August 27, 2011; and (3) although the NLRB has had four sitting Members between April 5, 2010 and August 27, 2011, it has issued some three-Member decisions during this time wherein one decision-maker, Craig Becker, was arguably unconstitutionally-appointed, rendering those decisions invalid. Potentially hundreds of decisions by the Board over the past three years are at risk of being declared invalid.

As we previously reported on January 31, 2013, and May 13, 2013, the Supreme Court is likely to address what constitutes a valid recess appointment next term in response to a petition filed by the Board in Canning. The Supreme Court will be faced with a Circuit split, as in 2004 the Eleventh Circuit upheld an intra-session appointment of a federal judge under the Recess Appointments Clause.

Summary of the Decision

Like the D.C. Circuit in Canning, the Third Circuit engaged in a historical analysis to conclude that the Constitution’s drafters intended that the President make recess appointments only during an intersession recess of the Senate. The Court rejected the argument that the President could also make these appointments during an intra-session recess of the Senate that lasted a non-negligible length of time (e.g., at least 10 days), or whenever the Senate is “unavailable for business,” the position taken by the Board. The Court found no merit in the argument that what constitutes a “recess” under the Recess Appointments Clause is a “political question” that the courts should refrain from deciding.

The Word “Recess” Itself

The Third Circuit initially focused on the meaning of word “recess” at the time the Constitution was written. The Court concluded that the word “recess” on its face could be read to include all proposed definitions, and, therefore, shed no insight on the question. In this regard the Third Circuit disagreed with the Canning decision in which the D.C. Circuit reasoned that the definitive article “the” preceding “recess” in the Recess Appointments Clause, meant that the clause only permitted appointments during the Senate’s formal intersession recess.

The Court then examined the historic use of “recess” in State constitutions at the time of the Constitution’s ratification. The Third Circuit explained that officials in some States interpreted the word “recess” to mean intersession recesses only, while officials in other States interpreted the word to include intra-session recesses lasting considerable lengths of time. Accordingly, while the historic use of the word “recess” failed to resolve the issue for the Court, it did lead the Court to discount the Board’s “anytime the Senate is unavailable for business” interpretation.

Constitutional Context

The Court then examined the Recess Appointments Clause in its Constitutional context, and concluded that the drafters of the Constitution intended for the President to make recess appointments only during intersession Senate recesses. The Third Circuit noted that the primary way for the President to appoint “Officers of the United States” (such as Board Members) is “by and with the Advice and Consent of the Senate,” whereas the Recess Appointments Clause provides an auxiliary method when the appointments cannot be made with the Senate’s approval. The Court pointed out that the only time the Senate definitively cannot give its approval is during an intersession recess, and that the Senate may, and, in fact, has taken action during intra-session breaks, even when it had agreed not to conduct business during such breaks. The Third Circuit further reasoned that the auxiliary nature of the Recess Appointments Clause is consistent with the Constitutional requirement that recess appointments expire at the end of “at the End of [the Senate’s] next Session,” which ensures that the appointments only last until the President can make appointments using the primary method.

Historic Practice

The Third Court found additional support for its conclusion by examining the President’s historic practice of making recess appointments. The Court highlighted that no President made an intra-session recess appointment for more than a century after the Constitution was written, few Presidents made intra-session appointments prior to World War II (one of whom was impeached), and intra-session recess appointments only became common in the past 30 years.

Separation of Powers

The Court ended its opinion by reasoning that its interpretation of the Recess Appointments Clause is needed to safeguard the separation of powers between the executive and legislative branches inherent in the President’s appointment powers. In the Court’s view, limiting the President’s ability to make recess appointments to intersession recesses of the Senate provides the “high walls” and “clear distinctions” required by separation of powers principles, whereas permitting the President to make recess appointments during “long” intra-session breaks of the Senate, or whenever the Senate is unavailable for business falls far short of providing these structural safeguards.

What’s Next?

Employers who have received unfavorable decisions from the Board since April 5, 2010 should consider appealing those decisions to the D.C. Circuit (which has jurisdiction over all NLRB decisions) or the Third Circuit (which covers Delaware, New Jersey, Pennsylvania and the U.S. Virgin Islands) if the decision in question was rendered by an improperly-constituted Board. Moreover, any actions taken by “agents” of the NLRB (e.g., Regional Directors), at a time when the Board had less than three-validly appointed Board Members are arguably invalid as well. (The Third Circuit has stayed a case involving such an allegation pending the Board’s appeal to the Supreme Court in Canning.) Notably, there is no time limit on appealing NLRB decisions, although a court might dismiss an appeal due to undue delay.

We now must await a decision on the meaning of “recess” by the Supreme Court. If the Court affirms the decisions of the Third and D.C. Circuits, the Board may have to re-decide hundreds of decisions just as it was required to do only a few years ago when the NLRB issued decisions with only two sitting Members. Meanwhile, despite these decisions, arguably improperly-appointed Board Members continue to participate in Board rulings. Fortunately for the NLRB, this saga may soon come to an end. Recently, the Senate HELP Committee (on Health, Education, Labor and Pensions) held a hearing on five pending nominations of Board Members. It is anticipated that these five nominees will be presented to the Senate as a package for its “Advice and Consent” this coming Wednesday, May 22, although a filibuster is possible.

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For answers to any questions about potentially improperly issued Board rulings or other NLRB issues, please feel free to contact an attorney in the Gibbons Employment & Labor Law Department.