On August 7, in SW General Inc. v. NLRB 2015 US App LEXIS 13812, a federal appellate court ruled that the January 5, 2011 appointment of Lafe Solomon as Acting General Counsel to the NLRB violated the Federal Vacancies Reform Act 5 U.S.C. Sections 3345 et. seq. (FVRA) (PDF). For that reasons it held that his authorizations to issue an unfair labor practice (“ULP”) complaint in the case was invalid and the NLRB’s decision finding the employer guilty of ULPs must be vacated. Since Solomon served as Acting General Counsel until November 4, 2013, the Court’s decision renders potentially suspect any and all NLRB ULP  decisions based upon complaints issued during that period.

Noel Canning

In NLRB v. Noel Canning 134 S. Ct. 2550 (2014) the Supreme Court invalidated a plethora of NLRB decisions based on its finding that the appointments of Board members who had participated in the decisions  were  invalid recess appointments because the Court found that the Senate was not in fact in recess at the time the appointments were made. In the wake of Noel Canning, the Board, then composed of members whose appointments had been properly confirmed by the Senate reconsidered and reissued most of those decisions.  SW General  seems to be another decision invalidating a scheme by the Administration to get around Senate roadblocks to appointments which has been invalidated by the Courts.

The Impact of SW General

But the Court in SW General made clear that its holding in that case would actually be much narrower in its impact.  That is because it held that if an employer had  not timely raised the issue of the General Counsel’s appointment,  the defense was waived:

We hold that the former Acting General Counsel of the NLRB, Lafe Solomon, served in violation of the FVRA from January 5, 2011 to November 4, 2013. But this case is not Son of Noel Canning and we do not expect it to retroactively undermine a host of NLRB decisions. We address the FVRA objection in this case because the petitioner raised the issue in its exceptions to the ALJ decision as a defense to an ongoing enforcement proceeding. We doubt that an employer that failed to timely raise an FVRA objection—regardless whether enforcement proceedings are ongoing or concluded—will enjoy the same success. See 29 U.S.C. § 160(e); Andrade, 729 F.2d at 1499.

In SW General, the defense was raised in exceptions to the Administrative Law Judge’s decision. Whether it can be raised after the decision by the NLRB is questionable.  29 U.S.C. Sec 160 (e) specifically provides: No objection that has not been urged before the Board, its member, agent, or agency, shall be considered by the court, unless the failure or neglect to urge such objection shall be excused because of extraordinary circumstances In Andrade v. Lauer, 729 F2d 1475 (D.C. Cir. 1984), the DC Circuit set forth the requirements needed to attack decisions by an invalidly appointed official:

 The core purposes of the doctrine are served if a plaintiff challenging government action on the ground that the officials taking that action improperly hold office meets two requirements. First, the plaintiff must bring this action at or around the time that the challenged government action is taken. Second, the plaintiff must show that the agency or department involved has had reasonable notice under all the circumstances of the claimed defect in the official’s title to office. This does not require that the plaintiff perform any particular rituals before bringing suit, nor does it mandate that the agency’s knowledge of the alleged defect must come from the plaintiff. It does, however, require that the agency or department involved actually knows of the claimed defect.

What This Means for Employers

Thus, employers found to have committed unfair labor practices in proceedings between January 5, 2011 and November 4, 2013, during Lafe Solomon’s  tenure as  Acting General Counsel should review the status of the proceedings against them and determine whether they are still able  to raise this issue as quickly as possible in any proceeding which has not yet been decided by the NLRB.

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