Chamber of Commerce of the United States of America v. National Labor Relations Board , 118 F. Supp. 3d 171 ( 2015 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
____________________________________
)
CHAMBER OF COMMERCE )
OF THE UNITED STATES )
OF AMERICA, et al., )
)
Plaintiffs, )
)
v. ) Civil Action No. 15-0009 (ABJ)
)
NATIONAL LABOR )
RELATIONS BOARD, )
)
Defendant. )
____________________________________)
MEMORANDUM OPINION
Plaintiffs the Chamber of Commerce of the United States of America, the Coalition for a
Democratic Workplace, the National Association of Manufacturers, the National Retail
Federation, and the Society for Human Resource Management (“the Chamber plaintiffs”) have
brought this action challenging a new set of regulations promulgated by the National Labor
Relations Board (“NLRB” or “the Board”) to govern union elections. They claim that the rule,
entitled “Representation – Case Procedures,” 79 Fed. Reg. 74,308 (Dec. 15, 2014) (“the Final
Rule”), exceeds the Board’s statutory authority under the National Labor Relations Act (“NLRA”),
29 U.S.C. §§ 151–169. They also contend that the Final Rule is arbitrary and capricious and should
be set aside under the Administrative Procedure Act (“APA”), 5 U.S.C. § 706, and that it violates
employers’ First and Fifth Amendment rights. Compl. [Dkt. # 1] (“Chamber Compl.”). In a
separate action, Baker DC, LLC (“Baker”) and three of its employees (collectively, “the Baker
plaintiffs”) also challenged the Final Rule on similar grounds, Am. Compl., Baker DC, LLC v.
NLRB, No. 15-0571 (ABJ) [Dkt. # 12] (“Baker Am. Compl.”), and the Court consolidated the two
cases. Order (Apr. 22, 2015) [Dkt. # 31] (“Consolidation Order”). After considering the points
and authorities set forth in the briefs submitted by both sides and the arguments presented at the
hearing, the Court will uphold the Final Rule.
Plaintiffs mount a broad attack on the rule as a whole, claiming that it “makes sweeping
changes to the election process” and that it “sharply curtails” employers’ statutory, due process,
and constitutional rights. Pls.’ Mot. for Summ. J. & Mem. in Supp. [Dkt. # 17] (“Chamber Mot.”)
at 1–3; see also Baker Am. Compl. ¶¶ 4–5, 11. But these dramatic pronouncements are predicated
on mischaracterizations of what the Final Rule actually provides and the disregard of provisions
that contradict plaintiffs’ narrative. And the claims that the regulation contravenes the NLRA are
largely based upon statutory language or legislative history that has been excerpted or paraphrased
in a misleading fashion. Ultimately, the statutory and constitutional challenges do not withstand
close inspection, and what is left is a significant policy disagreement with the outcome of a lengthy
rulemaking process. This is apparent from the Chamber plaintiffs’ heavy reliance upon the dissent
to the Final Rule published by two members of the Board. See 79 Fed. Reg. at 74,430–60 (dissent).
Plaintiffs’ policy objections may very well be sincere and legitimately based, but in the
end, this case comes down to a disagreement with choices made by the agency entrusted by
Congress with broad discretion to implement the provisions of the NLRA and to craft appropriate
procedures. Given the level of deference that applies in an APA case, particularly in the labor
context, and for the additional reasons set forth in more detail below, the Court does not find
grounds to overturn the Final Rule. 1 The Board’s motion for summary judgment will be granted.
1 A parallel challenge to the Final Rule in the United States District Court for the Western
District of Texas has been also resolved in the Board’s favor. Associated Builders & Contractors
of Tex., Inc. v. NLRB, No. 1-15-CV-026 RP, 2015 WL 3609116 (W.D. Tex. June 1, 2015).
2
BACKGROUND
I. Factual and Procedural Background
The Chamber plaintiffs are organizations and associations that “collectively represent
millions of employers and human resource professionals in companies covered by the NLRA and
subject to the Final Rule.” Chamber Compl. ¶¶ 11–16. They bring this action challenging the
Final Rule on behalf of their members. Id. ¶¶ 11–15. The Chamber plaintiffs filed a motion for
summary judgment, and the Board filed a combined partial motion to dismiss pursuant to Rule
12(b)(1) and cross-motion for summary judgment, and those motions have been fully briefed.
Chamber Mot.; Def.’s Partial Mot. to Dismiss & Cross-Mot. for Summ. J. [Dkt. # 22] (“Board
Mot.”); Pls.’ Mem. in Opp. to Board Mot. & in Further Supp. of Chamber Mot. [Dkt. # 25]
(“Chamber Reply”); Def.’s Reply in Supp. of Board Mot. [Dkt. # 27] (“Board Reply”). The Court
also received an amicus brief in support of the Chamber plaintiffs. Amicus Brief of the Nat’l Right
to Work Legal Def. & Educ. Found., Inc., in Supp. of Pls. [Dkt. # 19] (“Amicus Brief”).
The Baker plaintiffs are a District of Columbia employer and three of its employees. Baker
Am. Compl. ¶¶ 9–10. After the United Construction Workers Local Union No. 202-Metropolitan
Regional Council of Carpenters (“UCW”) filed a petition with the Board seeking to represent
Baker’s employees for collective bargaining purposes, Baker filed a separate action with this Court
on April 17, 2015, challenging the application of the Final Rule to Baker and its employees on
many of the same grounds as the Chamber plaintiffs. Compl., Baker DC, LLC v. NLRB, No. 15-
0571 (ABJ) [Dkt. # 1] (“Baker Compl.”). That same day, Baker filed a motion for a temporary
restraining order seeking to enjoin the enforcement of the Final Rule. Pl.’s Mot. for TRO, Baker
DC, LLC v. NLRB, No. 15-0571 (ABJ) [Dkt. # 3] (“Baker TRO Mot.”); Pl.’s Mem. in Supp. of
Baker TRO Mot., Baker DC, LLC v. NLRB, No. 15-0571 (ABJ) [Dkt. # 3-1] (“Baker TRO Mem.”).
3
Baker filed an amended complaint, adding three of its employees as plaintiffs, on April 21, 2015.
Baker Am. Compl. After finding that the Baker plaintiffs had failed to show that they would suffer
irreparable harm if they were subjected to the regulatory regime implemented by the Final Rule
pending resolution of the case on the merits, the Court denied the motion for injunctive relief and
consolidated the Baker action with the Chamber plaintiffs’ case. Baker DC, LLC v. NLRB, No.
15-0571 (ABJ), 2015 WL 1941516 (D.D.C. Apr. 22, 2015); Consolidation Order.
After the consolidation, the Baker plaintiffs joined the Chamber plaintiffs’ motion for
summary judgment and filed a supplemental opposition to the Board’s motion, Opp. of Baker Pls.
to Board Mot. [Dkt. # 32] (“Baker Opp.”), to which the Board replied. Def.’s Reply to Baker Opp.
[Dkt. # 33] (“Board 2d Reply”). All parties were heard at a hearing on the summary judgment
motions on May 15, 2015. See Tr. of Hr’g (May 15, 2015) [Dkt. # 38] (“Hr’g Tr.”). The Baker
plaintiffs also filed a supplemental brief at the Court’s direction. Supplemental Post-Hr’g Br. of
Baker Pls. in Resp. to Ct.’s Req. [Dkt. # 37] (“Baker Br.”). In joining the Chamber plaintiffs’
challenge to the Final Rule, the Baker plaintiffs also rely on the arguments advanced in Baker’s
motion for a temporary restraining order. See Baker Opp. at 1.
II. Statutory Background
The National Labor Relations Act is the federal statute that regulates private sector labor-
employer relations in the United States. 29 U.S.C. §§ 151–169. It was first passed by Congress
in 1935, Pub. L. No. 74-198, 49 Stat. 449 (1935), and it has since been amended several times.
See, e.g., Labor Management Relations (Taft-Hartley) Act, Pub. L. No. 80-101, 61 Stat. 136
(1947); Labor-Management Reporting and Disclosure (Landrum-Griffin) Act, Pub. L. No. 86-257,
73 Stat. 519 (1959); Act of July 26, 1974, Pub. L. No. 93-360, 88 Stat. 395 (1974).
4
The Act begins with a declaration of national policy:
It is hereby declared to be the policy of the United States to eliminate the
causes of certain substantial obstructions to the free flow of commerce and
to mitigate and eliminate these obstructions when they have occurred by
encouraging the practice and procedure of collective bargaining and by
protecting the exercise by workers of full freedom of association, self-
organization, and designation of representatives of their own choosing, for
the purpose of negotiating the terms and conditions of their employment or
other mutual aid or protection.
29 U.S.C. § 151. This statement is followed by a number of substantive provisions, including
several that are relevant to this case.
Sections 153 through 156 establish the National Labor Relations Board. Id. §§ 153–156.
Section 156 provides the Board with “authority from time to time to make, amend, and
rescind . . . such rules and regulations as may be necessary to carry out the provisions” of the
NLRA. Id. § 156. Section 157 is a declaration of the rights that employees “shall have,” including
“the right to self-organization, to form, join, or assist labor organizations, to bargain
collectively . . . [and] to refrain from any or all of such activities.” Id. § 157. Section 158(a)
defines unfair labor practices for both employers and labor organizations, and, in particular, it
provides: “[i]t shall be an unfair labor practice for an employer . . . to interfere with, restrain, or
coerce employees in the exercise of the rights guaranteed in section 157 of this title.” Id.
§ 158(a)(1). Section 158(c) protects parties’ free speech, and it provides that “[t]he expressing of
any views, argument, or opinion, or the dissemination thereof, whether in written, printed, graphic,
or visual form, shall not constitute or be evidence of an unfair labor practice under any of the
provisions of this subchapter, if such expression contains no threat of reprisal or force or promise
of benefit.” Id. § 158(c).
Section 159(b) states that it is the Board’s duty to determine the appropriate unit for the
purposes of collective bargaining, “in order to assure to employees the fullest freedom in
5
exercising the rights” guaranteed by the NLRA. Id. § 159(b). Accordingly, when employees and
their employer are unable to agree on whether the employees should be represented by a labor
union, section 159(c) sets out the procedures for resolving that issue. Id. § 159(c). First, an
employee, union, or employer files a petition for an election through one of the Board’s regional
offices. Id. § 159(c)(1). Second, if there is reasonable cause to believe that a “question of
representation” 2 exists, the Board will “provide for an appropriate hearing upon due notice,” which
the Court will refer to as the “pre-election hearing.” Id. The pre-election hearing may be
conducted by an officer or employee of one of the Board’s regional offices, called the hearing
officer. Id. If it is determined that a question of representation does exist, the Board directs an
election by secret ballot, and it certifies the results of that election. Id.
Section 153 of the NLRA allows the Board to delegate its section 159 authority to its
regional directors, permitting them “to determine the unit appropriate for the purpose of collective
bargaining, to investigate and provide for hearings, and determine whether a question of
representation exists, and to direct an election or take a secret ballot . . . and certify the results
thereof.” Id. § 153(b). While a hearing officer may conduct the pre-election hearing, he may not
make “any recommendations with respect thereto,” as decisions regarding elections are reserved
for the regional directors and the Board. See id. § 159(c)(1). “[U]pon the filing of a request [for
review] with the Board by any interested person, the Board may review any action of a regional
director delegated to him,” but review by the Board does not operate as a stay of the regional
director’s action. Id. § 153(b).
2 Under the Final Rule, “[a] question of representation exists if a proper petition has been
filed concerning a unit appropriate for the purpose of collective bargaining or concerning a unit in
which an individual or labor organization has been certified or is being currently recognized by
the employer as the bargaining representative.” 29 C.F.R. § 102.64(a).
6
III. Regulatory Background
After announcing the proposed rule and subjecting it to a notice and comment period, 3 the
Board published the Final Rule in the Federal Register on December 15, 2014. 79 Fed. Reg. at
74,308, 74,311. Two Board members dissented. Id. at 74,430–60 (dissent). As was announced
in December, the Final Rule went into effect on April 14, 2015. See id. at 74,308. It implemented
twenty-five changes to the procedures governing the election of union representatives for
collective bargaining purposes. Id. at 74,308–10 (summarizing amendments). Those changes are
codified within 29 C.F.R. Parts 101, 102, and 103.
Although the Chamber plaintiffs seek to have the entire Final Rule invalidated, see
Chamber Mot. at 44,4 they have raised specific objections to only some of the changes
implemented by the Final Rule. See Chamber Mot. at 10. The Baker plaintiffs object to the same
provisions. Baker Am. Compl. ¶ 4. Those provisions are:
x The requirement that, “[w]ithin 2 business days after service of the
notice of hearing, the employer . . . post the [Board’s] Notice of Petition
for Election in conspicuous places, including all places where notices to
employees are customarily posted, and shall also distribute it
electronically if the employer customarily communicates with its
employees electronically.” 29 C.F.R. § 102.63(a)(2).
3 In 2011, the Board issued a final rule enacting similar changes to the representation election
process, and it was also subject to a notice and comment period. 79 Fed. Reg. at 74,311; see also
Representation – Case Procedures, 76 Fed. Reg. 80,138 (Dec. 22, 2011). After the Chamber of
Commerce and the Coalition for a Democratic Workplace challenged that rule, it was invalidated
on the sole ground that the Board acted in the absence of a quorum. Chamber of Commerce v.
NLRB, 879 F. Supp. 2d 18, 20–21 (D.D.C. 2012). The court in that case stated that it “does not
reach – and expresses no opinion on – Plaintiffs’ other procedural and substantive challenges to
the rule.” Id. at 30.
4 It is not entirely clear whether the Baker plaintiffs seek to have the entire Final Rule set
aside or just the provisions they have challenged. Compare Baker Am. Compl. at 11 (asking that
the Court “[v]acate and set aside the new Rule”) with Baker Opp. at 2 (“The challenged provisions
of the new Rule should therefore be set aside.”). But, because they “agree with and incorporate
by reference” the Chamber plaintiffs’ pleadings, Baker Opp. at 1, which ask this Court to invalidate
the entire Final Rule, the Court will presume that the Baker plaintiffs seek the same relief.
7
x The requirement that the employer file a written “Statement of Position”
before the pre-election hearing is scheduled to begin, detailing its
position on a range of issues, or risk waiving its ability to litigate those
issues at the pre-election hearing. Id. §§ 102.63(b)(1)(i), 102.66(d).
x The provision clarifying that the purpose of the pre-election hearing “is
to determine if a question of representation exists,” and permitting
regional directors to decline to take evidence on or litigate “individuals’
eligibility to vote or inclusion in an appropriate unit.” Id. § 102.64(a).
x The provision stating that, once the pre-election hearing has been held
and a direction of election issued by the regional director, “[t]he regional
director shall schedule the election for the earliest date practicable
consistent with these rules.” Id. § 102.67(b).
x The requirement that the employer, within two business days after the
direction of election, provide a “voter list” to the regional director and
the parties to the election proceeding, containing “the full names, work
locations, shifts, job classifications, and contact information (including
home addresses, available personal email addresses, and available home
and personal cellular (‘cell’) telephone numbers) of all eligible voters.”
Id. § 102.67(l).
x The elimination of parties’ ability to stipulate to mandatory post-
election Board review through a stipulated election agreement. Id. at
101.28; 102.62(b). 5
Plaintiffs contend that certain of these provisions violate the NLRA or the Constitution, and that
several are the result of arbitrary and capricious rulemaking. Each challenged provision and the
specific grounds for plaintiffs’ objections are discussed in greater detail below.
5 At the summary judgment hearing, the Court asked the parties to identify the specific
changes enacted by the Final Rule to which they objected. Hr’g Tr. 6:14–18. Counsel for the
Chamber plaintiffs stated that they challenge amendments four, five, seven, eight, nine, ten,
thirteen, fifteen, seventeen, and twenty of the Final Rule. See id. 11:18–12:15, discussing 79 Fed.
Reg. at 74,308–10. Those amendments deal with the requirement that employers post the Board’s
Notice of Petition for Election; the timing, scope, and purpose of the pre-election hearing; the
requirement that employers file a pre-hearing statement of their position on a range of issues; the
elimination of the presumptive pre-election waiting period; the requirement that employers
disclose employees’ personal contact information; and the elimination of parties’ ability to
stipulate to mandatory Board review of post-election disputes. Counsel for the Baker plaintiffs
stated that they challenge the same amendments. See id. 16:15–19.
8
 STANDARD OF REVIEW
I. Motion to Dismiss
Under Rule 12(b)(1), the plaintiff bears the burden of establishing jurisdiction by a
preponderance of the evidence. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992);
Shekoyan v. Sibley Int’l Corp., 217 F. Supp. 2d 59, 63 (D.D.C. 2002). Federal courts are courts of
limited jurisdiction and the law presumes that “a cause lies outside this limited jurisdiction.”
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); see also Gen. Motors Corp.
v. EPA, 363 F.3d 442, 448 (D.C. Cir. 2004) (“As a court of limited jurisdiction, we begin, and end,
with an examination of our jurisdiction.”). “[B]ecause subject-matter jurisdiction is ‘an Art[icle]
III as well as a statutory requirement . . . no action of the parties can confer subject-matter
jurisdiction upon a federal court.’” Akinseye v. District of Columbia, 339 F.3d 970, 971 (D.C. Cir.
2003), quoting Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702
(1982).
When considering a motion to dismiss for lack of jurisdiction, unlike when deciding a
motion to dismiss under Rule 12(b)(6), the court “is not limited to the allegations of the complaint.”
Hohri v. United States, 782 F.2d 227, 241 (D.C. Cir. 1986), vacated on other grounds, 482 U.S.
64 (1987). Rather, “a court may consider such materials outside the pleadings as it deems
appropriate to resolve the question [of] whether it has jurisdiction to hear the case.” Scolaro v.
D.C. Bd. of Elections & Ethics, 104 F. Supp. 2d 18, 22 (D.D.C. 2000), citing Herbert v. Nat’l
Acad. of Scis., 974 F.2d 192, 197 (D.C. Cir. 1992); see also Jerome Stevens Pharms., Inc. v. FDA,
402 F.3d 1249, 1253 (D.C. Cir. 2005).
9
II. Summary Judgment
Summary judgment is appropriate when the pleadings and evidence show that “there
is no genuine dispute as to any material fact and [that] the movant is entitled to judgment
as a matter of law.” Fed. R. Civ. P. 56(a). However, in cases involving review of agency
action under the APA, Rule 56 does not apply due to the limited role of a court in reviewing the
administrative record. Select Specialty Hosp.-Akron, LLC v. Sebelius, 820 F. Supp. 2d 13, 21
(D.D.C. 2011).
Under the APA, a court must “hold unlawful and set aside agency action, findings, and
conclusions” that are “arbitrary, capricious, an abuse of discretion, or otherwise not
in accordance with law,” 5 U.S.C. § 706(2)(A), in excess of statutory authority, id. § 706(2)(C),
or “without observance of procedure required by law.” Id. § 706(2)(D). However, the scope
of review is narrow. See Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins.
Co., 463 U.S. 29, 43 (1983). The agency’s decision is presumed to be valid, see Am. Radio Relay
League, Inc. v. FCC, 617 F.2d 875, 879 (D.C. Cir. 1980), and a court must not “substitute its
judgment for that of the agency.” State Farm, 463 U.S. at 43.
When a plaintiff challenges an agency’s authority to act, a court analyzes the agency’s
interpretation of the authorizing statute using the two-step procedure set forth in Chevron, U.S.A.,
Inc. v. Natural Resource Defense Council, Inc., 467 U.S. 837 (1984). First, the court must
determine “whether Congress has directly spoken to the precise question at issue.” Id. at 842.
“If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency,
must give effect to the unambiguously expressed intent of Congress.” Id. at 842–43. Courts
“use ‘traditional tools of statutory construction’ to determine whether Congress has
unambiguously expressed its intent,” Serono Labs., Inc., v. Shalala, 158 F.3d 1313, 1319 (D.C.
10
Cir. 1998), quoting Chevron, 467 U.S. at 843 n.9, including the statute’s text, structure, purpose,
and legislative history. Bell Atl. Tel. Cos. v. FCC, 131 F.3d 1044, 1047 (D.C. Cir. 1997).
If the court concludes that the statute is either silent or ambiguous, the second step of the
review process is to determine whether the interpretation proffered by the agency is “based on a
permissible construction of the statute.” Chevron, 467 U.S. at 843. Once a reviewing court reaches
the second step, it must accord “considerable weight” to an executive agency’s construction of a
statutory scheme it has been “entrusted to administer.” Id. at 844. Indeed, “under Chevron, courts
are bound to uphold an agency interpretation as long as it is reasonable – regardless whether there
may be other reasonable, or even more reasonable, views.” Serono Labs., 158 F.3d at 1321.
If an agency’s construction of the applicable statute satisfies Chevron, the court is still
bound to ensure that the challenged action is not otherwise arbitrary and capricious. Nat’l Ass’n
of Clean Air Agencies v. EPA, 489 F.3d 1221, 1228 (D.C. Cir. 2007). Agency action will be upheld
if the agency involved “has considered the relevant factors and articulated a ‘rational connection
between the facts found and the choice made.’” Id., quoting Allied Local & Reg’l Mfrs. Caucus v.
EPA, 215 F.3d 61, 68 (D.C. Cir. 2000). The review is “[h]ighly deferential” and it “presumes the
validity of agency action.” AT&T Corp. v. FCC, 220 F.3d 607, 616 (D.C. Cir. 2000). The agency
may rely on comments submitted during the notice and comment period as justification for the
rule, so long as the submissions are examined critically. See Nat’l Ass’n of Regulatory Util.
Comm’rs v. FCC, 737 F.2d 1095, 1125 (D.C. Cir. 1984). But it “need not – indeed cannot – base
its every action upon empirical data; depending upon the nature of the problem, an agency may be
‘entitled to conduct . . . a general analysis based on informed conjecture.’” Chamber of Commerce
v. SEC, 412 F.3d 133, 142 (D.C. Cir. 2005), quoting Melcher v. FCC, 134 F.3d 1143, 1158 (D.C.
Cir. 1998).
11
ANALYSIS
I. The Nature and Justiciability of the Challenges to the Final Rule
A. The Facial Challenge to the Final Rule
The Court must first address the Board’s contention that those provisions of the Final Rule
that provide regional directors with a measure of discretion, such as those concerning the scope of
the pre-election hearing and the length of the campaigning period, are “not ripe for a pre-
enforcement facial challenge,” and that plaintiffs’ challenges to those provisions should be
dismissed. 6 Board Mot. at 4; see also Board Reply at 1–3; Board 2d Reply at 1–4. According to
the Board, because the Final Rule grants regional directors the discretion to determine whether
individual voter eligibility and inclusion issues will be litigated at the pre-election hearing, and
because it “contains no rigid time targets” for the length of representation election proceedings,
plaintiffs’ facial challenge is “ill-suited for review at this time.” Board Mot. at 5–6. In support of
this argument, the Board relies on Reno v. Flores, 507 U.S. 292 (1993), which held that a party
bringing a facial challenge to a regulation must prove that “no set of circumstances exists under
which the regulation would be valid.” Board Mot. at 4–5, quoting Flores, 507 U.S. at 301.
The Chamber plaintiffs submit that because they “challenge an agency’s purely legal
interpretation of a statute, not an exercise of discretion,” their “pre-implementation challenge” to
the discretionary aspects of the Final Rule is ripe. Chamber Reply at 2–3. In other words, because
the Final Rule has gone into effect, their attacks on its facial validity are justiciable, even as to the
discretionary provisions. Hr’g Tr. 21:19–22:18. The Court agrees with this contention; as the
D.C. Circuit has observed, “a purely legal claim in the context of a facial challenge . . . is
6 The Board does not dispute the ripeness of plaintiffs’ facial challenge to the non-
discretionary portions of the Final Rule. Board Mot. at 4 n.2; see also Board Reply at 1 n.1.
12
presumptively reviewable,” especially where it is a claim “that an agency’s action is arbitrary and
capricious or contrary to law.” Cement Kiln Recycling Coal. v. EPA, 493 F.3d 207, 215 (D.C. Cir.
2007), quoting Nat’l Ass’n of Home Builders v. U.S. Army Corps of Eng’rs, 417 F.3d 1272, 1282
(D.C. Cir. 2005). Indeed, this interpretation is consistent with Flores, which set out the no set of
circumstances test as the standard for consideration of a facial challenge on its merits. See 507
U.S. at 301.
The Chamber plaintiffs maintain, though, that the no set of circumstances test should not
apply. They state that “[t]he D.C. Circuit has made clear that ‘[t]he Supreme Court has never
adopted a no set of circumstances test to assess the validity of a regulation challenged as facially
incompatible with governing statutory law.’” Chamber Reply at 3–4, quoting Nat’l Mining Assoc.
v. U.S. Army Corps of Eng’rs, 145 F.3d 1399, 1407 (D.C. Cir. 1998). But the Court of Appeals
subsequently clarified that observation, and it has stated that the National Mining Association
decision “was made in the mistaken belief” that the Supreme Court had never before applied the
“no set of circumstances” test to a facial statutory challenge, when in fact it “had done just that
several years earlier in Flores.” Sherley v. Sebelius, 644 F.3d 388, 397 n.** (D.C. Cir. 2011); see
also Amfac Resorts, LLC v. Dep’t of Interior, 282 F.3d 818, 826 (D.C. Cir. 2002) (stating that the
National Mining Association decision “apparently overlooked” the Supreme Court’s ruling in
Flores), vacated in part on other grounds sub nom. Nat’l Park Hospitality Ass’n v. Dep’t of
Interior, 538 U.S. 803 (2003). Recognizing that it was “bound . . . by a higher authority,” the
Sherley Court followed Flores in applying the no set of circumstances test to a facial challenge to
13
agency regulations, despite the conflicting panel decision in National Mining Association. 644
F.3d at 397 n.**. 7
In Flores, a class of juvenile aliens challenged a final rule implemented by the Immigration
and Naturalization Service (“INS”). 507 U.S. at 299–300. The situation was similar to the one
facing this Court:
[T]his is a facial challenge to INS regulation 242.24. Respondents do not
challenge its application in a particular instance; it had not yet been applied
in a particular instance – because it was not yet in existence – when their
suit was brought . . . and it had been in effect only a week when the District
Court issued the judgment invalidating it. We have before us no findings
of fact, indeed no record, concerning the INS’s interpretation of the
regulation or the history of its enforcement. We have only the regulation
itself and the statement of basis and purpose that accompanied its
promulgation.
Id. at 300–01. Under the circumstances, the Court held that “[t]o prevail in such a facial
challenge,” the respondents “must establish that no set of circumstances exists under which the
[regulation] would be valid.” Id. at 301, quoting United States v. Salerno, 481 U.S. 739, 745
(1987). This test applied to “both the constitutional challenges, and the statutory challenge.” Id.,
citing Schall v. Martin, 467 U.S. 253, 268 n.18 (1984), and INS v. Nat’l Ctr. for Immigrants’
Rights, Inc., 502 U.S. 183, 188 (1991).
7 Several panels of the D.C. Circuit have applied the Flores no set of circumstances test to
facial challenges to agency actions and regulations. See, e.g., Ass’n of Private Sector Colls. &
Univs. v. Duncan, 681 F.3d 427, 433–34, 442 (D.C. Cir. 2012) (applying test to facial challenge
to Department of Education regulations that increased requirements for schools to qualify for
federal funds under Title IV of the Higher Education Act of 1965); Air Transp. Ass’n of Am., Inc.
v. Dep’t of Transp., 613 F.3d 206, 208, 213 (D.C. Cir. 2010) (applying test to amendments to
Department of Transportation Policy Regarding Airport Rates and Charges); see also Owner-
Operator Indep. Drivers Ass’n, Inc. v. Pena, 996 F.2d 338, 339 (D.C. Cir. 1993) (“[I]f we had
jurisdiction we would have to decide whether ‘the Pilot Program’ – whatever that might
comprehend – was incapable of being administered in a constitutional fashion.”), citing Flores,
507 U.S. at 301.
14
Given the procedural posture of this case, the Court will adopt the approach taken by the
D.C. Circuit panel in Sherley and follow Flores here. Accord Associated Builders & Contractors
of Tex., Inc. v. NLRB, No. 1-15-CV-026 RP, 2015 WL 3609116, at *4 (W.D. Tex. June 1, 2015).
(applying no set of circumstances test in parallel challenge to the Final Rule). Applying that
precedent, the Court finds that the facial challenge to the discretionary provisions of the Final Rule
is ripe for consideration, and the Board’s partial motion to dismiss will be denied. To succeed on
their motion for summary judgment, plaintiffs must show that there is no set of circumstances
under which the Final Rule could be applied consistently with the NLRA or the Constitution. 8
8 The Court acknowledges that two courts in this District, after carefully reviewing the
relevant precedent, observed that “there is a good deal of confusion in this Circuit and elsewhere
as to when courts should apply Reno v. Flores . . . rather than Chevron, when plaintiffs challenge
regulations on their face.” Am. Petroleum Inst. v. Johnson (API), 541 F. Supp. 2d 165, 188 (D.D.C.
2008) (noting that the Chevron approach “seem[ed] especially sound,” but deciding case on
procedural grounds under the APA); see also Mineral Policy Ctr. v. Norton, 292 F. Supp. 2d 30,
38–40 (D.D.C. 2003) (noting that “confusion in this Circuit remains” regarding the application of
the Flores test to facial challenges to agency regulations, and analyzing the challenge in that case
under Chevron). But these cases are not “controlling authority,” as the Chamber plaintiffs describe
them, see Chamber Reply at 4, and the courts in the API and Mineral Policy cases did not have the
benefit of several subsequent decisions issued by panels of the D.C. Circuit embracing the Flores
approach in reviewing agency regulations. See supra note 7.
In addition, the reasoning underlying the decision to apply Chevron rather than Flores in
those cases is distinguishable from the situation faced by the Court here. In the API case, the
question presented was one of pure statutory interpretation: the agency had undertaken to define
a statutory term in its new regulations. 541 F. Supp. 2d at 187–89. And the Mineral Policy case
also involved a question of statutory interpretation, and the court noted that Chevron was
“adequately deferential” to the decisions of the agency, and found that the regulation did not pass
muster under Chevron in any event. 292 F. Supp. 2d at 38–40. Here, in contrast, plaintiffs are
challenging a procedural regime that involves considerable discretion and for which there is no
history of enforcement. This differentiates the Final Rule from the sort of regulations to which
other courts in this District have applied Chevron rather than Flores, and it presents the very
situation that led the Supreme Court in Flores to apply the no set of circumstances test.
15
B. The Baker Plaintiffs’ As-Applied Challenge
Baker filed its initial complaint on April 17, 2015, three days after the Final Rule went into
effect and before proceedings under the Final Rule had begun. But while this action has been
pending, the Baker plaintiffs have proffered evidence along the way, alerting the Court about how
the Final Rule is being applied in the ongoing election proceeding at the company. See, e.g., Baker
Opp. at 1–2 (“appris[ing] the Court of events that have transpired in the related Board
representation proceeding since the filing of the [UCW] petition”). 9 The Baker plaintiffs contend
that, in light of the application of the Final Rule to the ongoing election proceeding, the Board can
no longer contend that the consolidated legal challenge is not ripe for review. Id. at 5.
As discussed above, the Court agrees that plaintiffs’ facial challenge to the Final Rule is
justiciable at this time, even absent any specific developments in the Baker election proceeding.
But to the extent that the Baker plaintiffs seek to recharacterize their complaint as including an as-
applied challenge, see Baker Br. at 1 (“Baker’s Complaint states both a facial and as-applied
challenge to the [Final] Rule.”), that challenge would not be ripe. Essentially, the Baker plaintiffs
are asking this Court to hit a moving target – to take notice of, and rule on, the propriety of the
regional director’s decisions in their representation case as it unfolds and before it is complete.
The very nature of this request makes it clear that any as-applied claims are not justiciable until
the entire election process and the subsequent Board review has come to its conclusion.
At the outset, the Court questions whether Baker’s original or amended complaint can even
be construed as asserting an as-applied challenge. The original complaint was filed on April 17,
9 Specifically, Baker has informed the Court that it was compelled to post the Board’s Notice
of Petition for Election, file a Statement of Position, and disclose employee names and information,
and that it was prevented from litigating individual voter eligibility and inclusion issues at the pre-
election hearing. See Baker Br. at 2.
16
2015, just three days after the Final Rule went into effect and well before any of its provisions had
been applied to Baker. See Baker Compl. And the amended complaint is identical in every
material respect to the original complaint. Compare Baker Compl. with Baker Am. Compl. Both
complaints allege only that the Final Rule on its face is contrary to the NLRA, the APA, and the
Constitution, and that it is arbitrary and capricious – not because of how it has been or will be
applied to Baker or its employees, but because of the way it was written. See Baker Compl. ¶¶ 12–
38; Baker Am. Compl. ¶¶ 12–38. 10 Ripeness is to be determined at the time the complaint is filed.
See, e.g., Ctr. for Sci. in Pub. Interest v. FDA, No. Civ. A. 03-1962 (RBW), 2004 WL 2218658, at
*3 (D.D.C. Sept. 17, 2004) (“When a court reviews claims for ripeness or standing to pursue a
claim, such review is conducted based on the facts that existed at the time the complaint was
filed.”). Therefore, since the Baker plaintiffs’ complaint and amended complaint were filed before
the Final Rule was fully applied to Baker, the Court could find on this ground alone that they do
not state an as-applied challenge.
Further, even if the Court generously construed the Baker complaints to include such a
challenge, it would not be ripe. The Baker plaintiffs assert that their extrinsic evidence “show[s]
as a matter of public record and undisputed facts that the allegations of the Complaint regarding
the [Final] Rule’s adverse impact on the Baker plaintiffs were true.” Baker Br. at 2; see also id. at
3 (“Baker’s supplemental information merely establishes that a number of these identified adverse
impacts have in fact occurred.”). But these assertions of ongoing or imminent injury-in-fact go to
10 In fact, large portions of the substantive allegations of the Baker plaintiffs’ complaints were
copied nearly verbatim from the Chamber plaintiffs’ complaint. Compare Baker Am. Compl.
¶¶ 19–23, 25–26, 28–38 with Chamber Compl. ¶¶ 65–70, 72, 76–86. And the Chamber plaintiffs
specifically acknowledged that they presented only a facial challenge. Chamber Reply at 3
(stating that the Chamber plaintiffs’ challenge presents “purely legal questions that . . . are properly
resolved through a facial challenge”). This casts further doubt on whether the Baker plaintiffs’
complaint states an as-applied challenge.
17
the Baker plaintiffs’ standing to bring these challenges – which has not been contested – and they
do not establish the ripeness of any as-applied challenge as a prudential matter.
“The fundamental purpose of the ripeness doctrine is ‘to prevent the courts, through
avoidance of premature adjudication, from entangling themselves in abstract disagreements over
administrative policies, and also to protect the agencies from judicial interference until an
administrative decision has been formalized and its effects felt in a concrete way by the challenging
parties.’” Sprint Corp. v. FCC, 331 F.3d 952, 957 (D.C. Cir. 2003), quoting Nat’l Park Hospitality,
538 U.S. at 807–08. While the constitutional aspect of ripeness may involve the same impending
injury-in-fact requirement that is necessary for standing, the prudential aspect of ripeness requires
more: a court must “balance[] ‘the fitness of the issues for judicial decision and the hardship to
the parties of withholding court consideration.’” Nat’l Treasury Emps. Union v. United States,
101 F.3d 1423, 1427–28 (D.C. Cir. 1996), quoting Abbott Labs. v. Gardner, 387 U.S. 136, 149
(1967), and citing Duke Power Co. v. Carolina Envtl. Study Grp., Inc., 438 U.S. 59, 81–82 (1978).
The fitness of an issue for judicial decision depends on whether there are “contingent future events
that may not occur as anticipated, or indeed may not occur at all.” Thomas v. Union Carbide Agric.
Prods. Co., 473 U.S. 568, 580–81 (1985) (citations omitted).
Here, to the extent the Baker plaintiffs wish to reformulate their claim as an as-applied
challenge, they are asking the Court to engage in precisely the sort of premature analysis of an
unfinished administrative process that the ripeness doctrine is designed to prevent. There are many
points in the representation election proceeding at which the Baker plaintiffs’ objections to the
discretionary decisions made under the Final Rule could be rendered moot: UCW could lose the
election, the number of challenged voters could be too small to affect the results, or the Board
could grant a request to review the regional director’s decision and overturn it. There has yet to
18
be a formal, final outcome, and these potential future events weigh against a finding that an as-
applied challenge is ripe. 11
Furthermore, once the process is complete, this would not be the forum in which the Baker
plaintiffs could obtain review in any event. Even if Baker loses at each of these administrative
stages, it can refuse to bargain with UCW, thereby triggering an unfair labor practice hearing, and
it can seek review of the result of that hearing before the D.C. Circuit pursuant to 29 U.S.C.
§ 160(f). Through that provision, “Congress declared that the person aggrieved by a Board
representation decision is obliged to precipitate an unfair labor practice proceeding as a means of
securing review in the appellate courts.” Hartz Mountain Corp. v. Dotson, 727 F.2d 1308, 1311
(D.C. Cir. 1984) (emphasis added) (citation omitted); see also id. at 1310 (“The cases are legion
holding that, as a general rule, Board orders emanating from representation proceedings are not
directly reviewable in court.”). The Baker plaintiffs insist that they are “not actually asking [the
Court] to enjoin the representation proceeding that’s ongoing,” and that they are only asking the
Court “to enjoin, to vacate” the Final Rule. Hr’g Tr. 69:1–5; see also Baker Opp. at 5 n.3
(“Plaintiffs are not seeking to enjoin an ongoing representation proceeding; they are seeking to set
aside an unlawful Rule.”). If that is so, then the facial challenge, which is the only aspect of the
Baker plaintiffs’ complaint that is ripe, should suffice to serve that purpose.
As for the Baker plaintiffs’ APA challenge, the Court cannot consider evidence of what is
transpiring in the ongoing representation case proceedings, because its review of the Board’s
action under the APA is limited to the administrative record that was before the agency at the time
11 As for the non-discretionary aspects of the Final Rule, like the requirements that employers
post the Board’s Notice of Petition for Election and disclose employee names and personal contact
information, those objections are still preserved, and they will be addressed in this Court’s ruling
on plaintiffs’ facial challenges.
19
it made its decision. See 5 U.S.C. § 706; James Madison Ltd. v. Ludwig, 82 F.3d 1085, 1095 (D.C.
Cir. 1996); see also Camp v. Pitts, 411 U.S. 138, 142 (1973) (per curiam) (“In applying [the abuse
of discretion] standard, the focal point for judicial review should be the administrative record
already in existence, not some new record made initially in the reviewing court.”). Thus, how the
Final Rule has been applied to Baker and its employees since it went into effect is not properly
part of any challenge under the APA, 12 and what is pending before the Court is the consolidation
of plaintiffs’ facial attack on the Final Rule, to be analyzed under the Flores test.
II. The Individual Challenges to the Final Rule
In examining each of plaintiffs’ challenges to the Final Rule, the Court cannot help but
notice that the complaints are largely conclusory and argumentative. 13 They rely heavily on the
repetition of disparaging labels, referring to the Final Rule as the “‘ambush’ or ‘quickie’ election
rule” that compels employees to “‘vote now, understand later.’” Chamber Mot. at 1, quoting 79
Fed. Reg. at 74,430 (dissent). This tendency to speak in broad terms continued well into the
12 The Baker plaintiffs contend that the ongoing proceedings are properly considered as part
of their APA challenge because the ripeness of their claims would not otherwise be “self-evident”
from the administrative record. Baker Br. at 5. But here again, they confuse ripeness with standing
in asserting that “it is no longer speculative” that the harms they have predicted will materialize as
a result of the Final Rule. Id. The Baker plaintiffs also claim that their extra-record information
may be considered as background material. Id. at 6, citing Esch v. Yeutter, 876 F.2d 976, 991
(D.C. Cir. 1989). But, as the Baker plaintiffs recognize, the Esch case has been severely limited
by the D.C. Circuit to circumstances which are entirely absent here. See Hill Dermaceuticals, Inc.
v. FDA, 709 F.3d 44, 47 (D.C. Cir. 2013) (“Esch has been given a limited interpretation since it
was decided, and at most it may be invoked to challenge gross procedural deficiencies – such as
where the administrative record itself is so deficient as to preclude effective review.”), citing
Theodore Roosevelt Conservation P’ship v. Salazar, 616 F.3d 497, 514 (D.C. Cir. 2010).
13 The Court observes that there is little about the Chamber plaintiffs’ press release of a
complaint that resembles the “short and plain statement” of facts called by for Federal Rule of
Civil Procedure 8. Indeed, much of what can only be characterized as argument is repeated –
almost verbatim – in the Chamber plaintiffs’ memorandum in support of their motion for summary
judgment. Compare Chamber Compl. ¶¶ 1–4, 11–17, 28–29, 32, 37, 39–49, 51 with Chamber
Mot. at 1, 3–5, 7–11.
20
parties’ lengthy, but often nebulous, memoranda. Faced with this lack of specificity, the Court
struggled at oral argument to get counsel to identify which provisions of the Final Rule violated
which provisions of the NLRA or the Constitution and how. Counsel resisted being pinned down,
insisting that the analysis should be conducted at the 30,000 foot level. This may be because when
one descends to the level of the particular, the provisions at issue are not quite as described. On
its face, the Final Rule does not necessarily lead to the outcomes to which plaintiffs object, because
it accords the Board’s regional directors considerable discretion to apply its provisions in a manner
that is appropriate to individual circumstances.
Plaintiffs fended off the Court’s attempts to zero in on specific regulatory language,
maintaining that it is the entire Final Rule – the combination of the requirement to submit an early
Statement of Position, the claimed elimination of the pre-election hearing on voter eligibility
issues, the shortening of the presumptive minimum time period between the petition and the
election, and the denial of an opportunity to agree to stipulate to full Board review – that violates
the statutory regime as a whole. But this attempt to look at the regulatory changes in the aggregate
fails if the component parts have been inaccurately portrayed, or if they each pass muster under
the applicable statutory and constitutional provisions. So the Court must proceed to examine each
of the challenged regulations individually, notwithstanding plaintiffs’ disinclination to do so.
The motions present no genuine issues of material fact, and so the case may be properly
decided on summary judgment as a matter of law. See Fed. R. Civ. P. 56(a); Celotex Corp. v.
Catrett, 477 U.S. 317, 322–23 (1986). The questions presented are: (1) whether the challenged
portions of the Final Rule violate the NLRA; (2) whether those provisions violate the First and
Fifth Amendments of the Constitution of the United States; and (3) whether the decision to
implement the Final Rule was arbitrary and capricious under the APA. The Court undertakes this
21
review bound by the long line of Supreme Court precedent which emphasizes that “Congress has
entrusted the Board with a wide degree of discretion in establishing the procedure and safeguards
necessary to insure the fair and free choice of bargaining representatives by employees.” NLRB v.
A.J. Tower Co., 329 U.S. 324, 330 (1946). “The control of the election proceedings, and the
determination of the steps necessary to conduct that election fairly were matters which Congress
entrusted to the Board alone.” NLRB v. Waterman S.S. Corp., 309 U.S. 206, 226 (1940). It is with
this direction in mind that the Court reviews each of the challenged provisions of the Final Rule.
A. The Posting Requirement
The Final Rule provides that “[w]ithin 2 business days after service of the notice of hearing,
the employer shall post the [Board’s] Notice of Petition for Election in conspicuous places,
including all places where notices to employees are customarily posted, and shall also distribute it
electronically if the employer customarily communicates with its employees electronically.” 29
C.F.R. § 102.63(a)(2) (“the Posting Requirement”). Under the prior regulations, the posting of
such a notice was voluntary, and the notice was less detailed. 79 Fed. Reg. at 74,309.
As an exhibit to its motion for a TRO, Baker submitted a copy of the notice it was required
to post, making it part of the record in this case. See Ex. 1 to Baker TRO Mot., Baker DC, LLC v.
NLRB, No. 15-0571 (ABJ) [Dkt. # 3-2] at 11–12. The notice is emblazoned with the text “National
Labor Relations Board” at the top and bottom, and that text is bracketed by two NLRB seals. Id.
The phrase “THIS IS AN OFFICIAL GOVERNMENT NOTICE” is printed in bold-face, capital
letters at the bottom of the second page. Id. at 12.
The notice informs employees that a petition has been filed by UCW, which is “seeking an
election to become certified as the representative” of Baker’s employees. Id. at 11. It also states
that, under “Federal Law,” employees have certain rights:
22
x To self-organiz[e]
x To form, join, or assist labor organizations
x To bargain collectively through representatives of [their] own choosing
x To act together for the purposes of collective bargaining or other mutual
aid or protection
x To refuse to do any or all of these things unless the union and employer,
in a state where such agreements are permitted, enter into a lawful
union-security agreement requiring employees to pay periodic dues and
initiation fees. Nonmembers who inform the union that they object to
the use of their payments for nonrepresentational purposes may be
required to pay only their share of the union’s costs of representational
activities (such as collective bargaining, contract administration, and
grievance adjustments).
Id.
The notice outlines the procedure for processing the petition for election. Id. It states that
the NLRB’s goal is to apply rules “that are intended to keep its elections fair and honest and that
result in a free choice,” and it sets forth examples of conduct that would interfere with employees’
rights and may result in setting aside the election. Id. at 12. The notice additionally informs the
reader that “every effort will be made to protect your right to a free choice under the law,” and that
“[t]he NLRB as an agency of the United States Government does not endorse any choice in the
election.” Id. Finally, the notice directs employees to “go to www.nlrb.gov or contact the NRLB”
to obtain “additional information about the processing of petitions.” Id.
The Final Rule provides that an employer’s failure to post or distribute the Notice of
Petition for Election may be grounds for setting aside the election if proper and timely objections
are filed. 29 C.F.R. § 102.63(a)(2).
Both sets of plaintiffs challenge the Posting Requirement on the grounds that it
impermissibly compels employers to engage in speech about unionization, even before the Board
23
has determined whether a petition is valid and will result in an election. Chamber Mot. at 42–44;
Baker TRO Mem. at 5–7. The Chamber plaintiffs argue that the Final Rule violates the First
Amendment, Chamber Mot. at 42–44, and the Baker plaintiffs claim that it contravenes the NLRA
and the First Amendment. Baker TRO Mem. at 5–7; Baker Am. Compl. ¶¶ 23–24.
1. The Posting Requirement does not violate section 8(c) of the NLRA.
Section 8(c) of the NLRA provides:
The expressing of any views, argument, or opinion, or the dissemination
thereof, whether in written, printed, graphic, or visual form, shall not
constitute or be evidence of an unfair labor practice under any of the
provisions of [the Act], if such expression contains no threat of reprisal or
force or promise of benefit.
29 U.S.C. § 158(c).
The Baker plaintiffs cite National Association of Manufacturers v. NLRB (NAM), 717 F.3d
947, 955 (D.C. Cir. 2013), overruled in part by American Meat Institute v. Department of
Agriculture, 760 F.3d 18, 22–23 (D.C. Cir. 2014), in support of their claim that the Posting
Requirement is contrary to section 8(c). Baker Am. Compl. ¶ 24; see also Baker TRO Mem. at 5–
6. But as this Court has already indicated in its Memorandum Opinion denying Baker’s motion
for a TRO, that case is distinguishable, and it does not stand for the proposition that a requirement
to post an election notice – or any NLRB-issued poster – contravenes the statute. See Baker, 2015
WL 1941516, at *4–*5.
In the NAM case, the trade association challenged a Board rule which would have required
all employers to post a general notice informing employees of their rights under the NLRA. 717
F.3d at 949–50. The rule included three possible sanctions for the failure to comply: it declared
that an employer’s failure to post the notice would constitute an unfair labor practice; it permitted
the Board to “suspend the running of the six-month limitations period for filing any unfair-labor-
24
practice charge” for a failure to post; and it authorized the Board to consider an employer’s failure
to post “as evidence of unlawful motive in a case in which motive is an issue.” Id. at 950–51.
Because the posting rule made an employer’s failure to post the Board’s notice an unfair
labor practice, and because it deemed such a failure to be evidence of unlawful motive in other
cases, the D.C. Circuit found, as the District Court did below, that the enforcement provisions of
the posting rule violated the guarantee in section 8(c) that “[t]he expressing of any views,
argument, or opinion, or the dissemination thereof . . . shall not constitute or be evidence of an
unfair labor practice.” NAM, 717 F.3d at 951, 954, 959; 29 U.S.C. § 158(c). Since the means for
enforcing the Board’s posting requirement were invalid, and the Court concluded that the
enforcement provisions could not be severed from the posting rule itself, it struck down the entire
rule. NAM, 717 F.3d at 963–64. Significantly, the Court did not decide “whether, as plaintiffs
also contend, the Board lacked the regulatory authority to issue . . . the requirement that employers
post the notice” under the NLRA or the Constitution. Id. at 963. So the NAM case does not support
the Baker plaintiffs’ argument that the Posting Requirement as contrary to section 8(c).
If anything, the case is contrary to the Baker plaintiffs’ position, because the D.C. Circuit
specifically distinguished the general employee rights notice involved in that case, which carried
with it the unfair labor practice penalty, from the then-existing NLRB election notice posting
requirement, which made the failure to post “a basis for setting aside the election.” Id. at 959 n.19
(“Our conclusion here does not affect the Board’s rule requiring employers to post an election
notice . . . . Because the failure to post the required election notice does not constitute an unfair
labor practice but may be a basis for setting aside the election, the rule does not implicate § 8(c).”),
citing 29 C.F.R. § 103.20(d) (2013). Like the election notice posting requirement deemed to be
lawful by the D.C. Circuit, the Final Rule provides only that an employer’s “failure properly to
25
post or distribute the Notice of Petition for Election may be grounds for setting aside the election.”
29 C.F.R. § 102.63(a)(2). So the Court finds that the Posting Requirement “does not implicate
§ 8(c),” see NAM, 717 F.3d at 959 n.19, and the Baker plaintiff’s section 8(c) challenge to the
Posting Requirement fails.
2. The Posting Requirement does not violate the First Amendment.
Both sets of plaintiffs also complain that the Posting Requirement compels employers to
speak and forces them “to disseminate a message the employer may not support or agree with,”
and that it therefore violates employers’ free speech rights. Chamber Mot. at 42; see also Baker
TRO Mem. at 5 (“The [Final] Rule . . . runs afoul of the First Amendment’s prohibition against
compelled speech by impermissibly co-opting employers to deliver the government’s own
preferred message.”). The Board takes the position that the notice is government speech which is
not subject to scrutiny under the free speech clause, and that since the Posting Requirement does
not interfere with employer speech, it does not violate the First Amendment. Board Mot. at 42–
43. 14
In the NAM case, this Court held that the requirement to post the NLRB notice of employee
rights did not violate the Constitution. Nat’l Ass’n of Mfrs. v. NLRB, 846 F. Supp. 2d 34, 58–61
(D.D.C. 2012), aff’d in part, rev’d in part on other grounds, 717 F.3d 947. And another judge in
this District recently addressed a similar First Amendment challenge to a Board posting rule, and
it found that the requirement to post a notice of employee rights “does not unconstitutionally
14 The Board also contends that the Chamber plaintiffs waived their First Amendment
argument because “it was not adequately raised by the Chamber during the rulemaking process.”
Board Mot. at 42. But since the Baker plaintiffs challenge the Final Rule on the same grounds,
and the Board has conceded that the consolidation of the two cases effectively moots their waiver
argument, see Hr’g Tr. 118:5–19, the Court need not decide the waiver issue, and it will proceed
to the merits of the First Amendment claim.
26
compel speech.” Nat’l Ass’n of Mfrs. v. Perez, No. 1:13-cv-01998 (APM), 2015 WL 2148230, at
*5 (D.D.C. May 7, 2015). The Court agrees with the thorough analysis in that case.
First, the Court finds that the Notice of Petition for Election is government speech. The
NLRB has effective control and final approval authority over the poster’s content, which are two
factors that signal government speech. See Pleasant Grove City, Utah v. Summum, 555 U.S. 460,
473 (2009) (finding government speech where “the City has ‘effectively controlled’ the messages
sent” by monuments displayed in a city park “by exercising ‘final approval authority’ over their
selection”), quoting Johanns v. Livestock Mktg. Ass’n, 544 U.S. 550, 560–61 (2005); see also
Walker v. Tex. Div., Sons of Confederate Veterans, Inc., 135 S. Ct. 2239, 2249–51 (2015) (applying
“direct control” and “final authority” factors in finding that a license plate is government speech).
And the notice clearly indicates that the government, and not the employer, is the speaker: it
displays the NLRB seal on all four corners, it is labeled “National Labor Relations Board” at the
top and bottom, and it announces, “THIS IS AN OFFICIAL GOVERNMENT NOTICE.” With
these identifiers, “there is little chance that observers will fail to appreciate the identity of the
speaker.” Summum, 555 U.S. at 471.
It is true, though, that “the First Amendment does not ‘le[ave] it open to public authorities
to compel [a person] to utter’ a message with which he does not agree.” Johanns, 544 U.S. at 557,
quoting W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624, 634 (1943). For that reason, the
Supreme Court has held that threatening schoolchildren with expulsion for refusing to recite the
Pledge of Allegiance, Barnette, 319 U.S. 624, or fining and jailing a Jehovah’s Witness for refusing
to display the state motto “Live Free or Die,” Wooley v. Maynard, 430 U.S. 705 (1977), violates
the First Amendment.
27
But a review of the case law indicates that the Posting Requirement is not unconstitutional,
even if the employers dispute the content of its message. In Rumsfeld v. Forum for Academic and
Institutional Rights, Inc. (FAIR), 547 U.S. 47 (2006), the Supreme Court found that the Solomon
Amendment, which required universities to permit military recruiters to recruit on campus at the
risk of losing their federal funding, did not abridge the schools’ free speech rights. Id. at 70. The
Court distinguished its prior government speech cases, noting that “[t]he compelled-speech
violation in each of our prior cases . . . resulted from the fact that the complaining speaker’s own
message was affected by the speech it was forced to accommodate.” Id. at 63. In other words, in
those cases, the government’s required speech “interfered with the [speaker’s] ability to
communicate its own message.” Id. at 64, citing Pac. Gas & Elec. Co. v. Pub. Util. Comm’n of
Cal., 475 U.S. 1, 8–9, 16–18 (holding that ordering a utility company to mail a third-party
newsletter along with its own newsletter interfered with the utility’s ability to communicate its
own message), and Miami Herald Publ’g Co. v. Tornillo, 418 U.S. 241, 256–58 (1974) (noting
that “the compelled printing of a reply . . . tak[es] up space that could be devoted to other material
the newspaper may have preferred to print,” and alters the message the paper wished to express).
The Court concluded that, because “nothing in the Solomon Amendment restricts what the law
schools may say about the military’s policies,” and because students “can appreciate the difference
between speech a school sponsors and speech the school permits because legally required to do
so,” there was no First Amendment violation. Id. at 65, 70.
Here, the Final Rule requires employers to display the NLRB’s message, but it does not
dictate “what they may or may not say” about the notice, the petition, or the representation election
28
process. See id. at 60. 15 As the Perez court put it, an employer “is required to host government
speech” as a part of the representation election process, but it is not required to engage in speech
itself. 2015 WL 2148230, at *6. If an employer chooses not to post the notice, it risks the potential
consequence that its failure to comply “may be grounds for setting aside the election whenever
proper and timely objections are filed.” 29 C.F.R. § 102.63(a)(2). 16 In providing employers with
that choice, the Final Rule recognizes that “an employer’s right to silence is sharply constrained
in the labor context, and leaves it subject to a variety of burdens to post notices of rights and risks.”
NAM, 717 F.3d at 959, quoting UAW-Labor Emp’t & Training Corp. v. Chao, 325 F.3d 360, 365
(D.C. Cir. 2003).
Nothing in the Final Rule constrains an employer from expressing its own position about
the election. And nothing about the poster, which outlines the Board’s election procedures and
accurately sets forth employees’ statutory rights to be free from coercion from either side,
undermines or dilutes an employer’s ability to convey its own pre-election message to counteract
what it sees as disagreeable government speech. See FAIR, 547 U.S. at 65; NAM, 717 F.3d at 958
15 The Perez court observed that requiring employers to post a government notice is “simply
not the same as forcing a student to pledge allegiance, or forcing a Jehovah’s Witness to display
the motto ‘Live Free or Die,’ and it trivializes the freedom protected in Barnette and Wooley to
suggest that it is.” 2015 WL 2148230, at *6, quoting FAIR, 547 U.S. at 62.
16 For that reason, as discussed above, the D.C. Circuit’s decision in NAM does not control
the result here. While the Court of Appeals in that case examined at length the parallels between
an employer’s free speech rights under section 8(c) and the First Amendment in reaching its
conclusion, NAM, 717 F.3d at 954–59, it did not base its ruling on First Amendment grounds, and
it instead invalidated the posting requirement solely because it was not severable from its penalty
provisions. Id. at 963; see also Perez, 2015 WL 2148230, at *5 (noting that the NAM case “does
not carry the constitutional weight that Plaintiffs ascribe to it” and that the case “did not announce
a First Amendment holding”).
29
n.15 (“We suppose an employer could post a statement next to the poster pointing out its
compulsory nature.”).
The Baker plaintiffs argue that the Notice of Petition for Election “is controversial, one-
sided and in some respects untrue” because it “improperly conditions the right of employees under
Section 7 to refrain from any and all [representation] activities,” and because it asserts that the
Board’s rules are designed to keep elections fair and honest, and to provide employees with a free
choice – a message with which Baker apparently disagrees. Baker TRO Mem. at 5 & n.2. But it
is well settled that the government may “make content-based choices” in its speech, and that it is
permitted to “regulate the content of what is or is not expressed when it is the speaker or when it
enlists private entities to convey its own message.” Rosenberger v. Rector & Visitors of the Univ.
of Va., 515 U.S. 819, 833 (1995).
Both sets of plaintiffs rely heavily on Wooley, but that case is distinguishable. In Wooley,
the Supreme Court held that New Hampshire could not require Jehovah’s Witnesses to display the
state motto, “Live Free or Die,” on their license plates, because the appellants had the right to
“decline to foster” speech to which they had moral, ethical, religious, and political objections. 430
U.S. at 707, 713–14. The Court took note of the fact that the state statute mandated “dissemination
of an ideological message by displaying it on [a person’s] private property in a manner and for the
express purpose that it be observed and read by the public.” Id. at 713, 720 n.15. But here, the
Final Rule requires an employer to display the Notice of Petition for Election to a limited audience
for a limited period of time, and it is plain from the poster that the company is simply transmitting
a message from the NLRB. Therefore, the Court finds that the Posting Requirement does not
violate the NLRA or the First Amendment, and it will uphold that aspect of the Final Rule.
30
B. The Scope of the Pre-Election Hearing
In the Final Rule, the Board addressed the conduct of the pre-election hearing, and it
emphasized at the start of the provision that “[t]he purpose of a hearing conducted under Section
9(c) of the Act is to determine if a question of representation exists.” 29 C.F.R. § 102.64(a). In
accordance with that understanding, the new provision permits hearing officers and regional
directors to decline to hear evidence on other issues – in particular, the eligibility of individual
employees to vote – that do not bear directly on that question. Specifically, the new regulation
states that “[d]isputes concerning individuals’ eligibility to vote or inclusion in an appropriate unit
ordinarily need not be litigated or resolved before an election is conducted.” Id. The regulation
mandates, though, that “it shall be the duty of the hearing officer to inquire fully into all matters
and issues necessary to obtain a full and complete record upon which the Board or the regional
director may discharge their duties under Section 9(c) of the Act.” Id. § 102.64(b). And in a
subsequent section, the Final Rule further provides that no party shall be precluded, “on the
grounds that a voter’s eligibility or inclusion was not contested at the pre-election hearing, from
challenging the eligibility of any voter during the election.” Id. § 102.66(d).
The regulations that immediately preceded those enacted by the Final Rule “did not
expressly state the purpose of the hearing,” 79 Fed. Reg. at 74,309, and provided any party with
the right “to introduce into the record documentary and other evidence” on any issue. 29 C.F.R.
§ 102.66(a) (2014); see also 79 Fed. Reg. at 74,309 (stating that the prior rules
“required . . . litigation of any voter eligibility issues that any party wished to litigate, even if the
regional director was not going to be deciding that question, and even if the particular voter
eligibility question was not necessary to resolving the existence of a question of representation”).
Both sets of plaintiffs object to the new provision on the grounds that it “severely restricts
the scope of the pre-election hearing required by the NLRA.” Chamber Mot. at 16; see also Baker
31
Am. Compl. ¶¶ 18–22. They allege that “[t]he Final Rule violates the Act’s requirement of an
‘appropriate’ pre-election hearing by restricting the employer’s ability to present evidence and
litigate issues of voter eligibility or inclusion in the putative bargaining unit,” and that it “deprives
employers of due process in NLRB representation case proceedings, in violation of the Fifth
Amendment, by preventing employers from litigating issues of voter eligibility and inclusion at
the pre-election hearing.” Chamber Compl. ¶¶ 65, 72; see also Baker Am. Compl. ¶¶ 19, 22.
These claims fail because the Final Rule on its face does not “prevent” or “restrict” the
presentation of such evidence at a pre-election hearing. The regulation simply indicates that
consideration of these issues will “ordinarily” be deferred until after the election, 29 C.F.R.
§ 102.64(a), when it will be clear whether or not the challenged voters could affect the outcome.
In other words, the regulation articulates an expectation that litigation on these topics will be
deferred, but it does not eliminate the possibility that a hearing officer could address these issues
at an early stage, and it accords the regional director the discretion to authorize a hearing on the
record in advance of an election in an appropriate case. See 79 Fed. Reg. at 74,390 (stating that
the Board “expect[s] regional directors to permit litigation of, and to resolve, [individual eligibility
or inclusion] questions when they might significantly change the size or character of the unit”).
1. Granting regional directors the discretion to decline to hear evidence
on individual voter eligibility and inclusion issues does not violate the
NLRA.
Notwithstanding the language of the complaints, plaintiffs indicated at oral argument that
the real gravamen of their concern is not that they are being denied the right to present this evidence
at all, but that section 9(c) of the NLRA requires that evidence about the composition of the unit
must be presented at a pre-election hearing. In other words, plaintiffs maintain that the Board did
not have the authority to make this decision discretionary:
32
[T]he Final Rule improperly limits pre-election hearings by allowing
hearing officers to exclude evidence regarding fundamental issues affecting
the election, such as whether certain employees or groups of employees are
eligible to vote in the election . . . . This contradicts the fundamental
understanding – recognized by the Supreme Court, Congress, and the Board
itself – that Congress required an “appropriate hearing” to give interested
parties a full and adequate opportunity to present their evidence on all
substantial issues.
Chamber Mot. at 15–16; see also Baker Am. Compl. ¶¶ 15, 18–19; Amicus Brief at 5–9.
Here again, plaintiffs overstate the terms of the Final Rule, which provides that ordinarily,
disputes concerning “individuals’” eligibility or inclusion will be deferred, and does not speak to
the inclusion of groups of employees. 29 C.F.R. § 102.64(a). But more important, the text of the
statute does not support plaintiffs’ contention that the NLRA requires that all voter eligibility
issues be heard and resolved in advance of the election.
In their complaint, the Chambers plaintiffs allege:
Section 9(c) of the NLRA provides that, when a petition for a representation
election is filed, the Board must investigate that petition and “shall provide
for an appropriate hearing upon due notice” before the election is held.
Chamber Compl. ¶ 64.
The Baker plaintiffs similarly allege:
Section 9(c)(1) of the Act, enacted as one of the Taft-Hartley amendments
of 1947, requires that the Board conduct an “appropriate hearing” with
regard to all “questions concerning representation.” As was made clear by
Senator Robert Taft, chief sponsor of the Taft-Hartley Act, Congress
intended by this language to require the Board to hold such hearings in order
to “decide questions of unit and eligibility to vote.”
Baker Am. Compl. ¶ 15, quoting 93 Cong. Rec. 6,858, 6,860 (1947).
It is telling that both sets of plaintiffs have chosen to paraphrase section 9(c), because a
reading of the text itself immediately reveals the problem with plaintiffs’ statutory argument.
Section 9(c) of the NLRA provides:
33
Whenever a petition shall have been filed . . . the Board shall investigate
such petition and if it has reasonable cause to believe that a question of
representation affecting commerce exists shall provide for an appropriate
hearing upon due notice. . . . If the Board finds upon the record of such
hearing that such a question of representation exists, it shall direct an
election . . . .
In determining whether or not a question of representation affecting
commerce exists, the same regulations and rules of decision shall apply
irrespective of the identity of the persons filing the petition . . . .
29 U.S.C. §§ 159(c)(1)–(2) (emphasis added).
According to the Chamber plaintiffs, “[a] hearing is ‘appropriate’ under § 9(c)(1) only if it
gives interested parties a full and adequate opportunity to present their evidence on all substantial
issues – including important election issues of voter eligibility, inclusion, and supervisory status.”
Chamber Reply at 6; see also Chamber Mot. at 6 (“The hearing provides an opportunity for the
parties to present evidence on issues that will affect the election, such as whether the employees
are covered by the NLRA, whether the collective bargaining unit defined in the petition is an
appropriate one, and whether certain individuals . . . would be eligible to vote . . . .”). 17 But the
statute does not call for a hearing on all issues affecting the election, or even all substantial issues
affecting the election. It clearly specifies that the purpose of the section 9(c) hearing is to
determine whether a question of representation exists. This is a yes or no question that is distinct
from the question of which individuals will vote in the ensuing election, so plaintiffs’ claim that
the Final Rule contravenes the Act cannot be based on the text of the statute.
17 For that proposition, plaintiffs cite the prior version of the regulations revised by the Final
Rule. Chamber Mot. at 6, citing 29 C.F.R. §§ 102.64(a), 102.66(a) (2014). But those sections do
not explicitly provide plaintiffs with the purported rights they identify. See 29 C.F.R. § 102.64(a)
(2014) (articulating the duties and responsibilities of the hearing officer in conducting the hearing,
including “inquir[ing] fully into all matters and issues necessary to obtain a full and complete
record”); id. § 102.66(a) (2014) (providing that “any party and the hearing officer shall have power
to call, examine, and cross-examine witnesses and to introduce into the record documentary and
other evidence”).
34
Plaintiffs gloss over the plain language of section 9, and they point instead to its legislative
history. Putting aside the question of whether that step is necessary in the absence of ambiguity,
see Ratzlaf v. United States, 510 U.S. 135, 147–48 (1994) (stating that a court need “not resort to
legislative history to cloud a statutory text that is clear”), the effort is ultimately unpersuasive,
since it is also incomplete and misleading. The Chamber plaintiffs assert that “[t]he purpose of
pre-election hearings, as reflected in the legislative history of the 1947 amendments, is to collect
evidence concerning all of the issues relevant to the election – including the eligibility of
employees to vote in the election.” Chamber Mot. at 21. In support of that contention, they set
out this quotation, without an ellipsis:
“Obviously, there can be no choice of representatives and no bargaining
unless units for such purposes are first determined. And employees
themselves cannot choose these units, because the units must be
determined before it can be known what employees are eligible to
participate in a choice of any kind.
This provision is similar to section 2 of 1934 amendments to the Railway
Labor Act (48 Stat. 1185), which states that – In the conduct of any election
for the purpose herein indicated the Board shall designate who may
participate in the election and establish the rules to govern the election.”
Id., quoting S. Rep. No. 74-573, at 14 (1935), reprinted in 2 NLRB, Legislative History of the
NLRA 1935, at 2313 (1949) (emphasis added in plaintiffs’ memorandum).
But the Chamber plaintiffs have omitted the first sentence of that excerpt, which makes it
plain that Congress was talking about section 9(b) – the provision of the NLRA that grants the
Board authority to decide the appropriate collective bargaining unit – and not section 9(c):
Section 9(b) empowers the National Labor Relations Board to decide
whether the unit appropriate for the purposes of collective bargaining shall
be the employer unit, craft unit, plaint unit, or other unit. Obviously, there
can be no choice of representatives and no bargaining unless units for such
purposes are first determined. And employees themselves cannot choose
these units . . . .
35
S. Rep. No. 74-573, at 14. The next sentence of the report after the language quoted by the
Chamber plaintiffs does address section 9(c), but it observes only that the provision empowers the
Board to conduct an investigation to determine collective bargaining representatives, and that “[i]n
any such investigation, an appropriate hearing must be held.” Id. So this snippet of legislative
history sheds no light on the intended scope of the pre-election hearing under section 9(c).
Both sets of plaintiffs also point to a statement by Senator Taft in the Congressional
Record: “[i]t is the function of hearings in representation cases to determine whether an election
may be properly held at the time; and if so, to decide questions of unit and eligibility to vote.”
Chamber Reply at 10, quoting 79 Fed. Reg. at 74,386 n.363; see also Baker Am. Compl. ¶ 15. But
this single sentence by Senator Taft cannot bear the weight that plaintiffs would have it carry. It
does not detail his position on the scope of the pre-election hearing as clearly as plaintiffs suggest,
but even if it was his preference or intention that all issues be resolved in advance, “[t]he ‘remarks
of [a] single legislator, even the sponsor, are not controlling in analyzing legislative history,’” Pac.
Legal Found. v. Council on Envtl. Quality, 636 F.2d 1259, 1264 (D.C. Cir. 1980), quoting Chrysler
Corp. v. Brown, 441 U.S. 281, 311 (1979), especially where that statement did not find its way
into the statutory text or even a committee report.
Furthermore, that remark cannot alter the clear language in the statute identifying the
purpose of the hearing, especially given the context of the Senator’s comments: they were
contained in a supplementary analysis produced after the Act had already passed and they were
directed at a provision authorizing pre-hearing elections – in Taft’s words, “a device of holding
the election first and then providing the hearing to which the parties were entitled by law” – which
was ultimately omitted from the Act. 93 Cong. Rec. 6,860 (1947); see also 79 Fed. Reg. at 74,386
36
n.363. Senator Taft’s lone comment is therefore not dispositive of the meaning of an “appropriate
hearing” as guaranteed by section 9(c). Accord Associated Builders, 2015 WL 3609116, at *7.
As they marshal these and other excerpts of legislative history, the Chamber plaintiffs
emphasize the importance of defining the bargaining unit before an election, see, e.g., Chamber
Mot. at 21, but they consistently blur the distinction between the determination of the appropriate
bargaining unit and challenges to individual voters. 18 It is true that it can be necessary in some
cases to hear evidence on the scope and composition of the unit in order to determine whether a
question of representation exists, but the Final Rule did not ban the introduction of any evidence
ever on the question of what groups of employees might be included: it states only that questions
concerning individual eligibility will ordinarily be deferred. 19
The Chamber plaintiffs’ citation of Supreme Court authority does little more to advance
their argument. They reiterate that section 9(c) calls for an “appropriate hearing,” and then they
purport to quote Inland Empire District Council v. Millis, 325 U.S. 697 (1945):
Congress provided that an “appropriate hearing” must include the “full and
adequate opportunity” to present evidence on all issues related to the
18 The Chamber plaintiffs complain that “[b]y authorizing regional directors and hearing
officers to reject evidence on the scope of the bargaining unit for voter eligibility and inclusion
purposes, the Final Rule makes the taking of evidence useless for all of the decision-making
required under §§ 3 and 9.” Chamber Mot. at 23. But the provision at issue does not address the
exclusion of evidence on the scope of the bargaining unit – only “[d]isputes concerning
individuals’ eligibility to vote or inclusion in an appropriate unit.” 29 C.F.R. § 102.64(a). And
the Final Rule does not, as the Chamber plaintiffs claim, “suggest[] that evidence pertaining to
voter eligibility should be excluded from the pre-election hearing even if the relevant issues affect
a substantial portion of the bargaining unit.” Chambers Mot. at 23, citing 29 C.F.R. § 102.64(a).
19 The Chamber plaintiffs maintain that the scope of the pre-election hearing should not be
limited because “the pre-election hearing record provides the sole basis” for a series of key
decisions, including “[w]hether particular individuals are eligible to vote.” Chamber Mot. at 18,
citing 29 U.S.C. §§ 153(b), 159(c)(1). But the statute does not lend support to this argument either,
and the Chamber plaintiffs ignore the fact that the regulations in the Final Rule specifically provide
for a full hearing on eligibility and inclusion issues at a later point. See 29 C.F.R. § 102.69.
37
election and disputed by the parties: “We think the statutory purpose . . . is
to provide for a hearing in which interested parties shall have full and
adequate opportunity to present their objections.”
Chamber Mot. at 23 (emphasis in original), quoting Inland Empire, 325 U.S. at 708. But this
edited reference to the opinion completely distorts the Inland Empire holding, which was that there
must be a hearing at some point, and not that it must necessarily occur before the election. What
the Court said was:
In view of the preliminary and factual function of an election, we cannot
agree with petitioners’ view that only a hearing prior to an election can be
“appropriate” within the section’s meaning. . . .
Petitioners’ argument does not in terms undertake to rewrite the statute. But
the effect would be to make it read as if the words “appropriate * * * in any
such investigation” were replaced with the words “hearing prior to any
election.” Neither the language of the section nor the legislative history
discloses an intent to give the word “appropriate” such an effect. We think
the statutory purpose rather is to provide for hearing in which interested
parties shall have full and adequate opportunity to present their objections
before the Board concludes its investigation and makes its effective
determination by the order of certification.
325 U.S. at 707–08 (emphasis added). And the Court reiterated the “broad discretion” conferred
by Congress upon the Board “as to the hearing which [section] 9(c) required before certification.”
Id. at 708. Like the legislative history, then, the Supreme Court precedent provided by plaintiffs
underscores the importance of affording parties a full opportunity to present evidence on a range
of substantial issues, but it does not specify that the evidence must be heard on every issue before
an election can proceed. Indeed, it says precisely the opposite.
Therefore, the Court finds that this aspect of the Final Rule does not violate section 9(c) of
the NLRA.
38
2. Granting regional directors the discretion to decline to hear evidence
on individual voter eligibility and inclusion issues is not arbitrary and
capricious.
Both sets of plaintiffs also rely upon the Board’s prior opinions in Barre-National, Inc.,
316 N.L.R.B. 877 (1995), and North Manchester Foundry, Inc., 328 N.L.R.B. 372 (1999),
asserting that in those opinions, “the Board recognized that § 9(c) provides a statutory right to
introduce evidence on issues of voter eligibility and inclusion at the pre-election hearing.”
Chamber Mot. at 24; see also Baker Opp. at 6. This overstates the holding of both cases somewhat,
and in any event, the Board’s departure from its previous precedent does not, standing alone, render
the Final Rule arbitrary and capricious.
In Barre-National, pursuant to the regional director’s instructions, the hearing officer ruled
that the supervisory status of a number of employees – who made up approximately eight to nine
percent of the unit – would not be resolved at the pre-election hearing, and he ordered that they be
permitted to vote subject to challenge. 316 N.L.R.B. at 877–78. The employer instructed those
individuals not to vote in the election on the grounds that they were supervisors. Id. at 878. By
the time the matter was decided by the Board, the employer had eliminated all but one of the earlier
contested positions, the election had been held, and the result had been impounded. Id. at 877.
The Board found, “[u]nder all the circumstances, the preelection hearing held in this case did not
meet the requirements of the Act and Board’s Rules and Statements of Procedure,” id. at 878, but
it did not specifically address the question of whether the hearing would have been mandated by
the statute alone. Given the posture of the case and the nature of the employer’s arguments, it did
not void the election, but remanded the matter back to the regional director to open and count the
ballots and take appropriate action thereafter as part of the election objection process. Id. at 877,
879. The Board also took pains to point out: “[t]his conclusion is based on the facts of this case.
39
We do not express a view as to whether a different result would be warranted if one or more of
those facts were different.” Id. at 878 n.9. The Board went on: “[w]e note that reviewing courts
have held that there is no general requirement that the Board decide all voter eligibility issues prior
to an election, although in some circumstances the size and character of the group of individuals
whose status is left unresolved may be deemed a basis for invalidating the election.” Id.
Similarly, in North Manchester, the hearing officer declined to take evidence on whether a
particular group of employees should be included in the unit, and the regional director denied the
request to reopen the record given the small number of employees involved and the fact that the
employer would have the ability to challenge their status after the election if the votes turned out
to be determinative. 328 N.L.R.B. at 372. The employer filed a timely request for review of the
regional director’s decision. Id. Applying Barre-National, the Board ruled that “the hearing
officer did not provide the employer with a sufficient opportunity to present its evidence at the
preelection hearing, as required under the Section 9(c) of the Act and the Board’s Rules and
Regulations,” and it required that the hearing be reopened for that purpose. Id. at 372–73.
The Board did not specifically state in either opinion that its determination was mandated
by the language of the statute alone. Plaintiffs are correct, though, when they point out that the
Final Rule marks a departure from the approach the Board called for in those cases. But as the
Sixth Circuit explained in Kindred Nursing Centers East, LLC v. NLRB, 727 F.3d 552 (6th Cir.
2013), that does not necessarily render the Final Rule unlawful under the APA:
Following the United States Supreme Court, we have held that [i]t is within
the Board’s purview . . . to develop standards for ascertaining whether one
unit is more appropriate than another. It follows, then, that it is within the
Board’s purview to choose to follow one of its precedents or reject another.
An agency may depart from its precedents, and provided that the departure
from precedent is explained, our review is limited to whether the rationale
is so unreasonable as to be arbitrary and capricious. An administrative
40
agency may reexamine its prior decisions and may depart from its
precedents provided the departure is explicitly and rationally justified.
Id. at 560 (internal citations omitted).
Here, the Board directly addressed Barre-National and North Manchester in its discussion
of this provision in the Final Rule, it explained and justified any change in its approach, and it
explicitly overruled those holdings. 79 Fed. Reg. at 74,385–86 (finding that Barre-National
“cannot be read to rest on a construction of the [NLRA],” that its statutory analysis “is essentially
non-existent,” and that its end result “is not administratively rational” and is contrary to legislative
history). Moreover, the decisions in Barre-National and North Manchester that it was error for
the regional director to fail to take up voter inclusion issues at the pre-election stage were based
on the specific circumstances presented in those cases, and there is nothing in the Final Rule that
would bar a regional director from following that guidance in any particular instance in the future,
or that would preclude the Board from granting an employer’s request for review and finding that
a particular regional director abused his discretion in a particular instance in the future. 20
Accordingly, the Court finds that this aspect of the Final Rule is not arbitrary and capricious. 21
20 The Baker plaintiffs also reference Barre-National, where the Board acknowledged the
employer’s concern that the unsettled status of a group of supervisors could sow unnecessary
confusion into the pre-election period or limit their opportunity to participate. Baker Opp. at 6;
see also Amicus Brief at 11–12. These are legitimate concerns that may militate in favor of an
evidentiary hearing in some particular cases in advance of the election. But the Court does not sit
as a policy-making member of the NLRB, and it cannot hold, given the deference required, that
the majority of the Board did not have the discretion to make the call it made as to how hearings
should proceed in the ordinary case. Baker has the opportunity to seek Board review of the
regional director’s decision in its election proceeding under section 3(b) of the NLRA, 29 U.S.C.
§ 153(b), and depending on the outcome of that request, it can also refuse to bargain with UCW
and obtain review of the entire proceeding in the D.C. Circuit. Id. § 160(f).
21 In addition to objecting to the Final Rule on the grounds that it reflects a departure from
the Board’s prior holdings, both sets of plaintiffs attack this aspect of the Final Rule as part of their
broader arbitrary and capricious challenges. See Chamber Mot. at 31–34; Baker Am. Compl.
¶¶ 27–32, 36. These arguments are addressed below.
41
3. Granting regional directors the discretion to decline to hear evidence
on individual voter eligibility and inclusion issues does not violate the
Fifth Amendment.
Plaintiffs also allege that permitting regional directors to exclude individual voter
eligibility and inclusion evidence at the pre-election hearing violates an employer’s Fifth
Amendment due process rights, because it denies the employer “the opportunity to be heard at a
meaningful time and in a meaningful manner.” Chamber Mot. at 25, quoting Mathews v. Eldridge,
424 U.S. 319, 333 (1976); see also Baker Am. Compl. ¶¶ 22. While that general proposition of
law is undisputed, plaintiffs have neglected to mention the other aspect of a due process claim: the
deprivation of a liberty or property interest. See, e.g., Atherton v. D.C. Office of Mayor, 567 F.3d
672, 689 (D.C. Cir. 2009) (“A procedural due process violation occurs when an official deprives
an individual of a liberty or property interest without providing appropriate procedural
protections.”); see also Mathews, 424 U.S. at 333 (“[S]ome form of hearing is required before an
individual is finally deprived of a property interest.”) (emphasis added). And as their counsel
conceded during oral argument, the Chamber plaintiffs were unable to direct the Court to any case
that identifies a due process interest in what takes place during a representation election
proceeding. Hr’g Tr. 13:17–20 (“The Court: I know what [Mathews v. Eldridge] says, but is there
a case in your brief that ties due process to these proceedings? Ms. Ho: No, Your Honor.”).
Essentially, the Chamber plaintiffs are asserting that they have a due process right to be
afforded due process. Id. 13:24–14:3 (“I think . . . the liberty or process interest at stake is how
Mathews describes it, is the interest in fair – in fair and meaningful proceedings. In other words,
to a meaningful opportunity to be heard on an issue.”). This is a circular argument which carries
no weight. Moreover, as counsel for the Chamber recognized, what process is due depends upon
the nature of the interest at stake. Id. 14:7–12 (“I think a meaningful opportunity to be heard,
42
obviously that doesn’t – that doesn’t mean you have a right to stand up in court and say anything
you want. And I think we certainly acknowledge, as the case law has held, that the due process
clause is, of course, quite context specific . . . .”).
In any event, as the Supreme Court observed in Inland Empire, “[t]he demands of due
process do not require a hearing, at the initial stage or at any particular point or at more than one
point in an administrative proceeding so long as the requisite hearing is held before the final order
becomes effective.” 325 U.S. at 710, quoting Opp Cotton Mills, Inc. v. Adm’r of Wage & Hour
Div. of Dep’t of Labor, 312 U.S. 126, 152–53 (1941). Because parties retain the right to petition
the Board for review, both pre- and post-election, and because they can refuse to bargain and obtain
a hearing on their claims before a federal court of appeals, the Court does not find that the Final
Rule violates parties’ due process rights to an “appropriate hearing.”
C. The Statement of Position Requirement
The Final Rule requires that an employer file a written Statement of Position one day before
the pre-election hearing. 29 C.F.R. § 102.63. The Statement of Position must:
state whether the employer agrees that the Board has jurisdiction over it and
provide the requested information concerning the employer’s relation to
interstate commerce;
state whether the employer agrees that the proposed unit is appropriate, and,
if the employer does not so agree, state the basis for its contention that the
proposed unit is inappropriate, and state the classifications, locations, or
other employee groupings that must be added to or excluded from the
proposed unit to make it an appropriate unit;
identify any individuals whose eligibility to vote the employer intends to
contest at the pre-election hearing and the basis of each such contention;
raise any election bar;
state the length of the payroll period for employees in the proposed unit and
the most recent payroll period ending date;
43
state the employer’s position concerning the type, date(s), time(s), and
location(s) of the election and the eligibility period; and
describe all other issues the employer intends to raise at the hearing.
Id. § 102.63(b)(1)(i). The Statement of Position must also “include a list of the full names, work
locations, shifts, and job classifications of all individuals in the proposed unit,” as well as any
individuals the employer wishes to add to or exclude from the proposed unit. Id.
§ 102.63(b)(1)(iii).
The Final Rule provides that “[a] party shall be precluded from raising any issue . . . that
the party failed to raise in its timely Statement of Position,” id. § 102.66(d), but “[t]he regional
director may permit the Statement of Position to be amended in a timely manner for good cause.”
Id. § 102.66(b).
The Final Rule explains that “[p]rior practice requested parties to state positions and
provide a list of employees and job classifications before the hearing, but did not require
production of such information prior to the hearing.” 79 Fed. Reg. at 74,309. In addition, “[p]rior
best practices required parties to take positions on the issues orally at the hearing,” but the approach
was not uniform, and parties were permitted at times “to remain silent on their position or to take
shifting positions during the hearing.” Id.
The Baker plaintiffs allege that the requirement “that Baker file a written Statement of
Position on each and every potential [sic] that could arise during a hearing, at a time when no pre-
hearing discovery is permissible, upon penalty of precluding Baker from presenting evidence on
unit and voter eligibility issues as expressly permitted by the Act, violates Section 9 and
Congressional intent.” Baker Am. Compl. ¶ 19; see also Baker TRO Mem. at 7–9. They also
object that they are required to “disclose to the petitioning union the names and work locations of
employees inside and outside the petitioned for unit, again upon penalty of precluding Baker from
44
exercising its statutory right to submit evidence on all issues.” Baker TRO Mem. at 7. Because
they assert that Baker is “entitled . . . under the statute ” to “contest numerous aspects of [UCW’s]
petition, including voter eligibility issues” at the hearing, the Baker plaintiffs contend that the
preclusive aspect of this provision “unlawfully prevents Baker from exercising its statutory and
due process rights.” Id. 22
1. The Statement of Position Requirement does not violate the NLRA.
Although it is not entirely clear from their pleadings, the Baker plaintiffs appear to be
arguing that the Statement of Position Requirement, which could limit an employer’s ability to
litigate certain issues at the pre-election hearing if those issues were not raised in the Statement of
Position, violates the section 9(c) requirement that there be an “appropriate” pre-election hearing.
See Baker Am. Compl. ¶¶ 4, 11, 19 (stating only that the Statement of Position Requirement
“violates Section 9”); Baker TRO Mem. at 7 (stating that Statement of Position Requirement
“preclud[es] Baker from exercising its statutory right to submit evidence on all issues” and citing
29 U.S.C. § 159(c)(1)). But as discussed in detail above, section 9(c) of the NLRA does not
guarantee an employer the right to present or litigate individual voter eligibility and inclusion
issues at the pre-election hearing, as the Baker plaintiffs claim. Rather, it provides that parties to
a representation proceeding are entitled to “an appropriate hearing upon due notice” that addresses
whether a “question of representation exists.” 29 U.S.C. § 159(c). So the possibility that the
22 At the hearing, the Chamber plaintiffs’ counsel stated that they also challenge the
Statement of Position Requirement “as arbitrary and capricious,” “with respect to . . . due
process . . . and also to the extent that it truncates the fullest freedom guaranteed by Section 8” of
the NLRA. Hr’g Tr. 9:6–15. But other than as part of the claim that the entire Final Rule is
arbitrary and capricious, Chamber Compl. ¶¶ 76–86, the Chamber plaintiffs do not offer a specific
basis for attacking the Statement of Position Requirement anywhere in their pleadings. During the
hearing, counsel directed the Court to pages fifteen through twenty-five of their memorandum,
Hr’g Tr. 9:20–24, but the Statement of Position Requirement is not mentioned on those pages, as
that portion of the brief addresses only the scope of the pre-election hearing.
45
preclusive aspect of the requirement that an employer file a Statement of Position might operate
to streamline the pre-election hearing in this manner does not violate section 9(c) of the NLRA.
Plaintiffs also allege that the issue preclusion embodied in this regulation is “contrary to
the [NLRA’s] goal of ensuring employees ‘the fullest freedom in exercising the rights guaranteed’”
by the Act. Baker TRO Mem. at 7, quoting 29 U.S.C. § 159(b); see also Hr’g Tr. 9:6–15 (stating
that the Chamber plaintiffs object to the Statement of Position Requirement “to the extent that it
truncates the fullest freedom guaranteed by Section 8” of the NLRA). The parties provide no
additional argument on this point, see Baker TRO Mem. at 7–9; Baker Am. Compl. ¶¶ 18–22, and
they do not articulate how section 9(b) is implicated here or how a requirement governing the
evidence an employer may present at the pre-election hearing would curtail employees’ rights.
See 29 U.S.C. § 159(b) (stating that the Board shall decide the appropriate unit for collective
bargaining purposes “in order to assure to employees the fullest freedom in exercising the rights
guaranteed” by the NLRA). But the Final Rule specifically includes an exception to the preclusion
aspect of the Final Rule for individual voter eligibility and inclusion evidence in any event:
A party shall be precluded from raising any issue . . . that the party failed to
raise in its timely Statement of Position . . . except that no party shall be
precluded from contesting or presenting evidence relevant to the Board’s
statutory jurisdiction to process the petition. Nor shall any party be
precluded, on the grounds that a voter’s eligibility or inclusion was not
contested at the pre-election hearing, from challenging the eligibility of any
voter during the election.
29 C.F.R. § 102.66(d) (emphasis added). So even if an employer failed – or refused – to include
the required information in its Statement of Position, and was therefore precluded from raising or
litigating individual voter eligibility and inclusion issues at the pre-election hearing, the employer
would still be able to raise and litigate those issues later and protect its employees’ rights.
Baker also objects to the requirement that it must list the names and work assignments of
the employees in the proposed unit in its Statement of Position, arguing that “[n]othing in the Act
46
authorizes the Board to require” such a disclosure. Baker Am. Compl. ¶ 16. While it may be true
that nothing in the statute explicitly directs the Board to require such disclosures, nothing in the
statute prohibits it, either. See Serono Labs., 158 F.3d at 1319 (D.C. Cir. 1998). 23 And in enacting
the NLRA, Congress plainly accorded the Board “a wide degree of discretion in establishing the
procedure and safeguards necessary to insure the fair and free choice of bargaining representatives
by employees.” A.J. Tower, 329 U.S. at 330. So, the Court finds that the Board did not exceed its
statutory authority by requiring these disclosures, and that the Statement of Position Requirement
withstands plaintiffs’ challenge under the NLRA.
2. The Statement of Position Requirement does not violate the Fifth
Amendment.
Plaintiffs also argue that “the burdensome requirement of the Statement of Position violates
Baker’s due process rights by not providing it sufficient time to respond to [UCW’s] petition.”
Baker TRO Mem. at 7–8, citing Mathews, 424 U.S. at 333; Hr’g Tr. at 9:25–10:11 (stating that the
Chamber plaintiffs challenge the same requirement “to the extent that it provides less time to
prepare for the hearing,” because “it raises due process concerns”).
The general proposition in Mathews v. Eldridge – that due process requires “the
opportunity to be heard ‘at a meaningful time and in a meaningful manner,’” 424 U.S. at 333,
quoting Armstrong v. Manzo, 380 U.S. 545, 552 (1965) – is undisputed. But as with their argument
regarding the scope of the pre-election hearing, plaintiffs have failed to identify – either in their
pleadings or during the hearing – precisely what liberty or property interest could be infringed by
23 The Court in Serono Laboratories was also persuaded by the fact that the statute, as it does
in this case, provided for a “broad grant of discretion to the agency.” 158 F.3d at 1319.
47
the Statement of Position Requirement. See Hr’g Tr. 12:16–15:2; 129:10–131:23. Without that
information, the Court cannot assess what appears to be a half-hearted due process claim. 24
In any event, the new regulations accord regional directors the discretion to grant an
extension to an employer who needs additional time to file and serve its Statement of Position.
See 29 C.F.R. § 102.63(b)(1) (“The regional director may postpone the time for filing and serving
the Statement of Position for up to 2 business days upon request of a party showing special
circumstances. . . . [and] may postpone the time for filing and serving the Statement of Position
for more than 2 business days upon request of a party showing extraordinary circumstances.”).
Indeed, Baker itself sought and was granted a seven-day extension to file and serve the Statement
of Position in its representation proceeding. Hr’g Tr. 125:25–126:9 (admitting that Baker was
given an extension for the “[s]tatement of position and the hearing”); see also Board’s Opp. to
Baker TRO Mot. as to Irreparable Harm, Baker DC, LLC v. NLRB, No. 15-0571 (ABJ), [Dkt. # 8]
at 3 (stating that Baker requested, and received, a seven-day postponement of the pre-election
hearing, “as well as the due date for filing a statement of position”). Given this built-in flexibility,
plaintiffs cannot show that an employer will necessarily be deprived of its due process rights in
every set of circumstances, so the attempt to mount a facial challenge to the Statement of Position
Requirement on Fifth Amendment grounds fails.
D. The Elimination of the Presumptive Pre-Election Waiting Period
The prior version of the regulations stated that the regional director “will normally not
schedule an election until a date between the 25th and 30th days after the date of the decision, to
24 The Court also notes that it is somewhat contradictory for plaintiffs to claim that it is too
“burdensome” to be asked to marshal their arguments so early and list them in the Statement of
Position, Baker TRO Mem. at 7; Hr’g Tr. 9:25–10:11, and to simultaneously insist that they should
be permitted to present and litigate every issue at the earliest possible stage. Baker TRO Mem. at
7–9; Baker Am. Compl. ¶¶ 15–16, 18–22; Chamber Mot. at 15–26.
48
permit the Board to rule on any request for review which may be filed.” 29 C.F.R. § 101.21(d)
(2014). Under the Final Rule, “[e]lections will no longer be automatically stayed in anticipation
of requests for review,” 79 Fed. Reg. at 74,309, and instead, “[t]he regional director shall schedule
the election for the earliest date practicable” consistent with the NLRA and the relevant
regulations. 29 C.F.R. § 102.67(b).
1. The elimination of the presumptive pre-election waiting period does not
violate the NLRA or the First Amendment.
Both sets of plaintiffs contend that the Final Rule’s elimination of the “normal” pre-election
waiting period and its instruction to hold elections on “the earliest date practicable” violate the
NLRA and the First Amendment by “impermissibly curtail[ing] an employer’s right to
communicate with its employees.” Chamber Compl. ¶ 70; Baker Am. Compl. ¶ 26; see also
Chamber Mot. at 26–31. The Chamber plaintiffs argue that section 9(b) of the Act, which directs
the Board to “assure to employees the fullest freedom” in exercising their rights under the Act, and
the free speech protections afforded by section 8(c), combine together to guarantee employers the
right to “sufficient time to engage in free speech before an election.” Chamber Mot. at 27.
The Court acknowledges that section 8(c) of the NLRA reflects a “policy judgment, which
suffuses the NLRA as a whole, as ‘favoring uninhibited, robust, and wide open debate in labor
disputes.’” Chamber of Commerce v. Brown, 554 U.S. 60, 67–68 (2008), quoting Letter Carriers
v. Austin, 418 U.S. 264, 272–73 (1974). But plaintiffs have failed to show that the Final Rule
inhibits this debate in any meaningful way, and they certainly have not shown that there is “no set
of circumstances” in which this aspect of the Final Rule can be enforced consistently with the
NLRA or the First Amendment. That is because the regional director retains discretion in
determining when the election will be held, and in doing so, he is directed “to consider, among
other factors, the desires of the parties, which may include their opportunity for meaningful speech
49
about the election.” 79 Fed. Reg. at 74,318. As the District Court in Texas observed in its opinion
upholding the Final Rule, this discretion makes it “virtually impossible” for plaintiffs to
demonstrate that the elimination of the pre-election waiting period violates the NLRA or the First
Amendment, or otherwise exceeds the Board’s authority under its authorizing statute. Associated
Builders, 2015 WL 3609116, at *12.
Furthermore, this aspect of the Final Rule does not specifically burden employer speech,
because all parties to the election proceeding are constrained by the same timeframe in
disseminating their views to employees. As the Board observed, employers likely have an
advantage in communicating with their employees during a shortened election period, in that they
“can compel employees to attend meetings on working time at the employer’s convenience,”
including meetings at which employees “are often expressly urged to vote against representation.”
79 Fed. Reg. at 74,322–23. By contrast, a union’s “organizers normally have no right of access to
plant premises” and do not have the same captive audience that an employer may have. Id. at
74,337. 25
The Chamber plaintiffs also contend that the legislative history of the Act – specifically,
comments by then-Senator John F. Kennedy – makes clear “that Congress believed that at least 30
days between petition and election was necessary to adequately assure employees the statutorily
guaranteed ‘fullest freedom’ in choosing whether to be represented by a union.” Chamber Mot. at
29, citing 105 Cong. Rec. 5,361 (1959), reprinted in 2 NLRB, Legislative History of the Labor-
Management Reporting and Disclosure Act of 1959, at 1024 (1974) (“LMRDA Hist.”) (“[T]his
25 The Court also agrees with the Texas court’s observation that it is “somewhat ironic that
[p]laintiffs both oppose disclosure of cell phone numbers and email addresses, methods of
communication which would certainly accelerate the process of providing information [to
employees], yet complain that the [Final] Rule fails to provide adequate time for dissemination of
information.” Associated Builders, 2015 WL 3609116, at *12 n.10.
50
provision would permit a representation election 30 days after a petition is filed . . . if there are no
substantial issues of fact or law which require a hearing . . . . The 30 day waiting period is an
additional safeguard against rushing employees into an election where they are unfamiliar with the
issues.”); see also Chamber Mot. at 29, citing 105 Cong. Rec. 5,770 (1959), reprinted in 2 LMRDA
Hist. at 1085 (“[T]here should be at least a 30-day interval between the request for an election and
the holding of the election.”). 26
But plaintiffs do not – and cannot – point to language in the NLRA which provides a right
to a waiting period of some specified length prior to an election, because there is no such language
in the statute. Accord Associated Builders, 2015 WL 3609116, at *12. Where, as here, the statute
is unambiguous on its face, a court need “not resort to legislative history to cloud a statutory text
that is clear.” Ratzlaf, 510 U.S. at 147–48; see also Ala. Power Co. v. Costle, 636 F.2d 323, 400
(D.C. Cir. 1979) (noting that, despite “some indication in the legislative history [of the Clean Air
Act] to suggest that at least one Senator intended” to limit a statutory definition, “the language of
the statute clearly did not enact such limit into law” and that the Court was “constrained here to
follow the clear language”) (footnotes omitted). Furthermore, as stated above, “[t]he ‘remarks of
the single legislator . . . are not controlling in analyzing legislative history.’” Pac. Legal Found.,
636 F.2d at 1264, quoting Chrysler Corp., 441 U.S. at 311.
In any event, as with plaintiffs’ citation to legislative history with regard to the appropriate
hearing requirement, their reliance on Senator Kennedy’s comments is misplaced. Senator
Kennedy made his comments when Congress was considering a proposal to reinstate the pre-
26 It appears to the Court that these citations to Senator Kennedy’s comments are contained
in the daily edition of the Congressional Record. For the permanent edition of the Congressional
Record containing Senator Kennedy’s comments, see 105 Cong. Rec. 5,984 (1959) and 105 Cong.
Rec. 6,434 (1959).
51
hearing election procedure. This proposal would have permitted an election to take place before
any hearing at all, and the Senator made his comments about the need for a waiting period in that
context. The proposal was ultimately rejected by Congress, see 79 Fed. Reg. at 74,326, and
Senator Kennedy’s comments are therefore entitled to little weight in this Court’s analysis of the
Final Rule. See, e.g., Cent. Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511
U.S. 164, 187 (1994) (“[F]ailed legislative proposals are ‘a particularly dangerous ground on
which to rest an interpretation of a prior statute.’”), quoting Pension Benefit Guar. Corp. v. LTV
Corp., 496 U.S. 633, 650 (1990).
Finally, the Court agrees with the Board that because the Final Rule “does not in any way
permit the Board to use speech or its dissemination as evidence of an unfair labor practice, the
literal language of [s]ection 8(c) is not implicated.” 79 Fed. Reg. at 74,319, citing NAM, 717 F.3d
at 956, 959 n.19 (invalidating employee rights posting rule which permitted Board to consider
failure to post notice as unfair labor practice, but noting that similar rule which lacked such a
penalty “does not implicate § 8(c)”). For all these reasons, the Court finds that this aspect of the
Final Rule survives plaintiffs’ statutory and constitutional challenges.
2. The elimination of the presumptive pre-election waiting period is not
arbitrary and capricious.
For similar reasons, to the extent that plaintiffs attempt to argue that this particular aspect
of the Final Rule is arbitrary and capricious, see Chamber Compl. ¶¶ 79–81; Baker Am. Compl.
¶¶ 30–32, that challenge also fails. The discretion afforded to the regional director in setting the
election date effectively precludes a finding that the Board acted arbitrarily or capriciously in the
context of a facial challenge. See, e.g., Am. Hosp. Ass’n v. NLRB, 499 U.S. 606, 619 (1991) (“The
fact that petitioner can point to a hypothetical case in which the rule might lead to an arbitrary
result does not render the rule ‘arbitrary or capricious.’”).
52
E. The Employee Information Disclosure Requirement
Plaintiffs also attack the Final Rule’s requirement that employers disclose employees’
personal contact information in a voter list. The NLRB first required employers to disclose
employee contact information in its 1966 decision in Excelsior:
[W]ithin 7 days . . . after the Regional Director or the Board has directed an
election . . . the employer must file with the Regional Director an election
eligibility list, containing the names and addresses of all the eligible voters.
The Regional Director, in turn, shall make this information available to all
parties in the case.
156 N.L.R.B. at 1239–40. In that case, the Board found that “a lack of information with respect
to one of the choices available” in a representation election impeded employees’ exercise of free
choice in those elections under section 9(b) of the NLRA, and it determined that “by providing all
parties with employees’ names and addresses, we maximize the likelihood that all the voters will
be exposed to the arguments for, as well as against, union representation.” Id. at 1240–41. The
Supreme Court later endorsed this rationale. NLRB v. Wyman-Gordon Co., 394 U.S. 759, 767
(1969) (“The disclosure requirement furthers this objective [to ensure the fair and free choice of
bargaining representatives] by encouraging an informed employee electorate and by allowing
unions the right of access to employees that management already possesses.”).
The Final Rule expands Excelsior, requiring employers to produce a voter list containing
“the full names, work locations, shifts, job classifications, and contact information (including
home addresses, available personal email addresses, and available home and personal cellular
(‘cell’) telephone numbers) of all eligible voters” within two business days of a direction of
election. 29 C.F.R. § 102.67(l) (“the Employee Information Disclosure Requirement”). The Baker
plaintiffs contend that this requirement is contrary to the NLRA, and both sets of plaintiffs claim
that it is arbitrary and capricious. Chamber Mot. at 40–41; Baker TRO Mem. at 9–11; see also
Amicus Brief at 21–24.
53
1. The Employee Information Disclosure Requirement does not violate
the NLRA.
The Baker plaintiffs do not identify a specific provision of the NLRA that the Employee
Information Disclosure Requirement allegedly violates. Instead, they seek to invalidate this
requirement on the sole grounds that “[n]othing in the Act authorizes the Board to require
employers to disclose the personal and private phone numbers and personal email addresses of
their employees.” Baker Am. Compl. ¶ 17. But, again, the fact that the NLRA does not specifically
authorize the Board to mandate these disclosures does not mean that the statute prohibits it. See
Serono Labs., 158 F.3d at 1319. Without more, the Court does not find that the Employee
Information Disclosure Requirement violates any provision of the NLRA.
The Baker plaintiffs also argue that this requirement runs counter to “privacy statutes . . . in
which Congress has expressed its intent to increase employee privacy and not decrease it.” Hr’g
Tr. 18:5–8; see also Baker TRO Mem. at 10–11 (discussing the Privacy Act, the privacy exemption
to the Freedom of Information Act, the Telemarketing and Consumer Fraud and Abuse Protection
Act, and the Controlling the Assault of Non-Solicited Pornography and Marketing Act). They
assert generally that the requirement “conflicts with Congressional intent to protect worker privacy
against further intrusion,” and that it is “the Board’s obligation to accommodate its rules to the
competing interests of other federal laws.” Baker TRO Mem. at 11. But they do not elaborate
upon or provide authorities in support of this contention.
Regardless, as the court observed in the Western District of Texas litigation, not one of the
statutes the Baker plaintiffs cite restricts the disclosure of employee information by employers or
to unions: the Privacy Act and FOIA relate to the disclosure of information maintained by federal
agencies, and the other two statutes restrict the conduct of telemarketers and other non-solicited
communications. Associated Builders, 2015 WL 3609116, at *9 n.6. And the Board specifically
54
considered these concerns in promulgating the Final Rule, noting that “to the extent that any such
laws are found applicable to the nonemployer parties’ use of the contact information, those parties
would be required to conform their conduct” to those statutes. 79 Fed. Reg. at 74,346, 74,352.
So, this aspect of the Baker plaintiffs’ challenge to the Employee Information Disclosure
Requirement is also unavailing.
2. The Employee Information Disclosure Requirement is not arbitrary
and capricious.
Both sets of plaintiffs argue that the Employee Information Disclosure Requirement is
arbitrary and capricious because it disregards employees’ substantial privacy concerns, fails to
provide an opt-out mechanism, and lacks a meaningful penalty for misuse of the voter list.
Chamber Compl. ¶ 82; Chamber Mot. at 40–41; Baker Am. Compl. ¶ 33; Baker TRO Mem. at 9–
11; see also Amicus Brief at 21. The Board counters that the Final Rule’s expansion of the voter
list requirement is consistent with the purpose of the NLRA and that it simply modernizes the
existing requirement to disclose employees’ home addresses in a way that reflects “the
communications revolution that has transformed our country.” Board Mot. at 35–37.
The Final Rule requires employers to supply “available” personal email addresses and
“available” home and personal cell phone numbers, 29 C.F.R. § 102.62(d), 27 with the goal of
advancing the two interests articulated by the Board in Excelsior:
(1) Ensuring the fair and free choice of bargaining representatives by
maximizing the likelihood that all the voters will be exposed to the
27 Importantly, the disclosure requirement does not appear to require employers to track down
employee contact information they do not already have in their possession, as it mandates the
production only of “available personal email addresses, and available home and personal cellular
(‘cell’) telephone numbers).” 29 C.F.R. § 102.67(l) (emphasis added); see also 79 Fed. Reg. at
74,338 n.146 (“[I]f the employer does not maintain those [personal email] addresses and numbers,
it does not need to ask its employees for them.”). In addition, the Final Rule “does not require
employers to furnish the other parties or the regional director with the work email addresses and
work phone numbers of the eligible voters.” 79 Fed. Reg. at 74,335.
55
nonemployer party arguments concerning representation; and
(2) facilitating the public interest in the expeditious resolution of questions
of representation by enabling the parties on the ballot to avoid having to
challenge voters based solely on lack of knowledge as to the voter’s identity.
79 Fed. Reg. at 74,335, citing Excelsior, 156 N.L.R.B. at 1240–41, 1242–42, 1246. The Court
must accord the agency the deference to which it is entitled, but it also must determine whether
the Board considered the relevant factors when seeking to further these goals, and whether it
articulated a rational connection between the facts it found and the choices it made. Clean Air
Agencies, 489 F.3d at 1228.
a. The Board’s conclusion that the Employee Information
Disclosure Requirement ensures fair and free employee choice
was not arbitrary and capricious.
The Board first found that the Employee Information Disclosure Requirement would
further Excelsior’s goal of “ensuring the fair and free choice of bargaining representatives by
maximizing the likelihood that all the voters will be exposed to the nonemployer party arguments
concerning representation.” 79 Fed. Reg. at 74,335. It determined that “the provision of only a
physical home address no longer serves the primary purpose of the Excelsior list,” and that the
disclosure of home and cellular telephone numbers and personal email addresses was warranted,
based on the following factors:
x The “revolution in communications technology,” which has resulted in a
shift away from the U.S. mail system and face-to-face communication, in
favor of mass and electronic media, including cellular phones and email;
x The increased speed with which communications can occur via email and
cellular phones, as opposed to traditional mail or face-to-face
communications;
x The recognition that home and cellular phones have become a “universal
point of contact” for a large majority of Americans; and
x The fact that employers increasingly communicate with their employees via
email about representation elections.
56
Id. at 74,336–41.
The Board engaged in a review of statistics and studies showing that the most common
methods of communication have changed drastically since Excelsior, shifting away from face-to-
face and traditional mail communications and toward cellular phones and email. See id. at 74,335–
40. For example, the Board cited a Census Bureau study showing that, whereas only 78% of
households possessed a telephone in 1960, 97.6% of households had at least one phone as of the
year 2000. Id. at 74,338–39. In addition, the Board noted that while “door to door solicitation is
nearly extinct, and first class mail is at its lowest volume in 25 years,” “39.6 billion emails were
being sent every day” as of 2010, and that while cellular phones were “a non-existent technology
at the time of Excelsior,” 90% of American adults owned one as of 2014. Id. at 74,337, 74,339.
The Board also specifically considered the comments it received that took the position that
“because the Board chose not to mandate disclosure of phone numbers in [Excelsior], at a time
when at least basic telephone technology existed, then it should not do so today.” Id. at 74,338.
In response, the Board observed that home telephones in 1966 lacked voicemail or answering
machine technology and therefore did not necessarily facilitate communication with potential
voters, but cellular and home telephones today can receive and store voicemails and text messages
and are therefore more useful and dependable tools for communication. Id. It also noted that home
phone ownership has increased significantly, and that cellular phones and the advances in text
messaging technology had increased the value of phones as a communication tool, and it
concluded: “the changes in phone ownership and use make personal phones a universal point of
contact today in a way that was unimaginable” when Excelsior was decided. Id. Therefore, the
Board found that the precedent it set in Excelsior did not preclude it from expanding the
requirement in the Final Rule. Id.
57
The Board’s analysis reflects consideration of the relevant issues, and there is a rational
connection between its discussion of the increased use of digital communications technology in
lieu of face-to-face communication and the U.S. mail and the regulation that was promulgated. As
the Supreme Court has observed, “[t]he responsibility to adapt the [NLRA] to changing patterns
of industrial life” has been entrusted to the Board, NLRB v. J. Weingarten, Inc., 420 U.S. 251, 266
(1975), and its decision to do so in this case was not arbitrary and capricious.
b. The Board’s conclusion that the Employee Information
Disclosure Requirement facilitates the public interest was not
arbitrary and capricious.
The Board also found that the expanded disclosure regime would further Excelsior’s
second goal of “facilitating the public interest in the expeditious resolution of questions of
representation by enabling the parties on the ballot to avoid having to challenge voters based solely
on lack of knowledge as to the voter’s identity.” 79 Fed. Reg. at 74,335. The Board noted that
“in many cases at least some of the names on the employer’s list of eligible voters are unknown to
the other parties,” which might force a union to challenge those unknown voters, delaying the
results of an election. Id. at 74,340. The Board found that the new requirement would help the
parties “investigate the identity of any unknown employees on the employer’s voter list in a more
timely manner, thereby helping to decrease the chances that the [party] will have to challenge
voters based solely on the ignorance of their identities.” Id.
While the Board did not provide statistical support for its determination that the disclosure
rule would facilitate the resolution of questions of representation on a more timely basis, this
finding is “of a judgmental or predictive nature,” and “a forecast of the direction in which future
public interest lies necessarily involves deductions based on the expert knowledge of the agency.”
FCC v. Nat’l Citizens Comm. for Broad., 436 U.S. 775, 813–14 (1978), quoting FPC v. Transcon.
58
Gas Pipe Line Corp., 365 U.S. 1, 29 (1961). And plaintiffs did not challenge the validity of this
stated rationale, or the Board’s finding that the disclosure requirement would further that goal.
Thus, the Court does not find this aspect of the Final Rule to be arbitrary and capricious.
c. The Board did not act arbitrarily or capriciously by failing to
consider commenters’ objections in adopting the Employee
Information Disclosure Requirement.
Plaintiffs do not attack the underlying justification for the original Excelsior requirement
and they do not question the connection between the facts the Board lays out in support of the
Final Rule and the Employee Information Disclosure Requirement. But, they claim that the
disclosure requirement is arbitrary and capricious because it disregards employees’ substantial
privacy concerns, it lacks an opt-out mechanism, and it does not contain a meaningful penalty for
misuse of the voter list. Chamber Compl. ¶ 82; Chamber Mot. at 40–41; Baker Am. Compl. ¶ 33;
Baker TRO Mem. at 9–11.
i. Employee Privacy Concerns
Plaintiffs contend in their memoranda that the Board “brushed aside all concerns for
employee privacy and security,” Baker TRO Mem. at 10, that it “concluded, without adequate
justification and concern for employee rights” that the risks to employee privacy were worth
taking, Chamber Compl. ¶ 82, and that it acted “without any reasoning or analysis.” Chamber
Mot. at 41. But these conclusory allegations are belied by the text of the Final Rule, which
indicates that the Board engaged in a lengthy and thorough analysis of the privacy risks and other
concerns raised by the commenters before reaching its conclusion that the Employee Information
Disclosure Requirement was warranted. 79 Fed. Reg. at 74,341–52.
The Board specifically weighed “employee privacy concerns” against the “public interests
in the fair and free choice of bargaining representatives and in the expeditious resolution of
59
questions of representation” in finding that the expanded requirement was justified. Id. at 74,341.
It recognized “that advances in technology since Excelsior have created a heightened risk of
unauthorized dissemination of personal information,” and that there is increased public concern
about privacy issues “due to incidents of identity theft, government surveillance and hacking of
retailers’ electronic databases.” Id. at 74,342. But it found that the privacy risks associated with
the use of cell phones and email “are part of our daily life,” and that “[t]hese risks are worth taking
and as a practical matter, must be taken, if communication about organizational issues is going to
take place using tools of communication that are prevalent today.” Id.
The Board acknowledged that “‘[employees] have [a] nontrivial privacy interest in
nondisclosure’ of home address information,” and that “some employees will consider disclosure
of the additional contact information . . . to invade their privacy, even if they are never contacted.”
Id., quoting Dep’t of Def. v. FLRA, 510 U.S. 487, 501 (1994). But it noted that the risk that an
employee’s privacy rights would be infringed “should be more pronounced surrounding an
employee’s home address – long disclosable under Excelsior – than for the additional contact
information (phone numbers and email addresses)” mandated under the Final Rule. Id. at 74,343.
The Court agrees with the Board’s observation that, in contrast to the home addresses, which “may
lead to face-to-face contact” at an employee’s home, “disclosure of employee phone numbers and
email addresses may simply lead to phone calls or email messages, which are more easily ignored.”
Id.; see also Associated Builders, 2015 WL 3609116, at *11 (“Virtual contact can be readily
ignored. And virtual contact information can be and is routinely changed, unlike a physical home
address.”). And the Board reiterated that the Final Rule requires only the disclosure of available
employee contact information, so if an employee has not shared a personal email address or cell
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phone number with his or her employer, the employer will not be able to disclose it to the other
parties. 79 Fed. Reg. at 74,343 n.169.
Finally, the Board noted that the information to be disclosed “is limited in scope” and does
not reveal any sensitive information “about the employees’ politics, their religion, their
associations, or even their position regarding the labor organization in question.” Id. at 74,343–
44. It pointed out that “the voter list information will be provided to a limited set of recipients,”
and “will not be made available to the public at large.” Id. at 74,344. Ultimately, the Board found
that “the substantial public interests – in fair and free elections and in the speedy resolution of
questions of representation – served by the voter list amendments outweigh the employees’
acknowledged privacy interest in the information that will be disclosed.” Id. at 74,343. Given the
Board’s consideration of the comments it received raising employees’ privacy concerns, its
reasoned analysis as to why the expanded disclosure requirement was necessary, and the
deferential standard that must be applied, the Court does not find that the Board acted arbitrarily
and capriciously in enacting the Final Rule despite its implications for employee privacy.
ii. Opt-out Mechanism
Plaintiffs also contend that the failure to incorporate an opt-out provision in the Final Rule,
which would permit an employee to choose not to receive union communications via email or
telephone, was arbitrary and capricious. Chamber Mot. at 40; Baker TRO Mem. at 9–11.
The Board considered commenters’ suggestions on this point, and it determined that “it
would hardly be consistent with the policy underlying Excelsior – ensuring that employees receive
sufficient information from the nonemployer party to make an educated decision – to begin
allowing employees to opt in or opt out of such disclosures.” 79 Fed. Reg. at 74,347. It also found
that including an opt-out mechanism in the Final Rule could “impose significant administrative
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burdens on the government and the parties,” that it could “invite new areas of litigation resulting
in additional costs to the parties and the Board,” and that it would delay the election “if extra time
were allotted between an election’s direction and its conduct for communication with the subject
employees concerning their ability to opt in or out” of the union’s communications. Id. For those
reasons, the Board found that “attempting to craft a universally applicable opt-out requirement
unique to Board elections would have highly uncertain benefits at a cost of generating new election
disputes and possible conflicts with other Federal regulation of the same subject matter.” Id. at
74,348. Instead, it determined that “the existing self help remedy available to anyone who objects
to unwanted communications – ignoring calls or letters and deleting emails – seems for the time
being to be a more cost-effective option.” Id.
Plaintiffs do not challenge the Board’s findings on this issue, and they do not identify
evidence on this point that the Board failed to consider. They simply disagree with the choice the
Board made, and that is not enough to mount a successful APA challenge. Because the Board’s
decision not to include an opt-out provision in the Final Rule bears a rational connection to the
facts it found and the factors it considered, the Court finds that it was not arbitrary and capricious.
iii. Penalty for Misuse
Finally, plaintiffs contend that Final Rule is arbitrary and capricious because the Board
“declin[ed] to announce penalties for misusing the [voter list],” which could lead to the abuse of
employees’ personal contact information. Chamber Mot. at 41; see also Baker TRO Mem. at 12;
Amicus Brief at 22. But the Final Rule does prohibit abuse: it mandates that parties “shall not use
the [voter] list for purposes other than the representation proceeding, Board proceedings arising
from it, and related matters.” 29 C.F.R. § 102.67(l). The Board addressed some of the
commenters’ concerns that the prohibition was not explicit enough, observing that “it goes without
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saying that nonemployer parties would run afoul of the restriction if, for example, they sold the
list to telemarketers, gave it to a political campaign or used the list to harass, coerce, or rob
employees.” 79 Fed. Reg. at 74,358. The Board added that “if the disclosure of the additional
contact information does subject employees to harm, the Board ‘shall provide an appropriate
remedy,’” id. at 74,342, quoting Excelsior, 156 N.L.R.B. at 1244, and that leaving the “question
of remedies to case-by-case adjudication,” as the Board did in Excelsior, was the best approach.
Id. at 74,359.
The Board also addressed commenters’ objections that the disclosure of employees’
personal phone and email information “could lead to harassment and coercion” in the absence of
an explicit penalty provision. Id. at 74,341–42. Similar concerns were raised at the time of
Excelsior, and the Board stated that no instances of abuse specifically linked to the Excelsior list
had been reported in the nearly fifty years since Excelsior was decided. 28 Id. The Board found
that a union seeking to obtain employees’ votes in its favor was highly unlikely to engage in
coercive behavior, as doing so would greatly decrease the union’s chance of receiving that
employee’s vote. Id. Further, it reviewed statistics showing that “out of 24,681 representation
elections conducted between fiscal years 2000 and 2010, employers filed objections involving
28 The Chamber plaintiffs argue that “[t]he notion that unions have never abused access to
employee home address information is belied by publicly available Board decisions.” Chamber
Reply at 27 & n.9, citing Brown & Sharpe Mfg. Co., 299 N.L.R.B. 586, 590 (1990); Kohler Co.,
128 N.L.R.B.1062, 1106 (1960); Int’l Ass’n of Machinists, 189 N.L.R.B. 50, 54 (1971). But these
same cases were raised and considered during the rulemaking process, and as the Board observed,
those cases “are not linked to misuse of Excelsior list information, but, rather, include the entire
range of coercive union conduct, including when that union is already acting as an employees’
bargaining representative.” 79 Fed. Reg. at 74,342. And while such decisions indicate that some
misuse of employee contact information has potentially occurred, they show that the Board “has
and will continue to address those situations.” Associated Builders, 2015 WL 3609116, at *10.
The Court is therefore not persuaded that these isolated cases show that the expanded Excelsior
list information is likely to be abused, and it does not find that the Final Rule is arbitrary and
capricious on that basis.
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allegations of union threats and/or violence in 469 cases,” of which only 16 resulted in an election
being set aside on that basis. Id. at 74,342 n.162. The Board observed that nothing in its database
indicated that any of these 16 cases involved the misuse of Excelsior information, and that “a
record of union coercion sufficient to set aside an election in 0.065% of elections over a recent 10-
year span simply does not demonstrate that union coercion and intimidation in the context of an
organization campaign is rampant.” Id. (internal quotation marks omitted). The Board found that
the commenters presented only “the mere potential for misuse of the voter list information,” and
it concluded that it would “not make policy based on mere speculation.” Id. at 74,342.
In Wyman-Gordon, the Supreme Court stated that it is for the Board and not for the Court
to weigh the interest in an informed employee electorate against “the asserted interest of employees
in avoiding the problems that union solicitation may present.” 394 U.S. at 767. Because the Board
did just that in reaching its conclusion that the risks to employees’ privacy interests “are worth
taking” to ensure that “communication about organizational issues is going to take place using
tools of communication that are prevalent today,” 79 Fed. Reg. at 74,342, the Court will not
substitute its judgment for the Board’s. Therefore, the Court finds that the Employee Information
Disclosure Requirement does not violate the APA.
F. The Elimination of the Parties’ Ability to Stipulate to Mandatory Post-
Election Board Review Through a Stipulated Election Agreement
Under the prior regulations, all pre-election review and some post-election review by the
Board was discretionary, but the parties could agree in a stipulated election agreement 29 to make
29 A stipulated election agreement is an agreement between the parties to a representation
proceeding, made with the approval of the regional director, waiving the parties’ right to a pre-
election hearing and providing specific procedures for an election held pursuant to the agreement.
See 29 C.F.R. § 102.62(b).
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Board review of post-election disputes mandatory. 79 Fed. Reg. at 74,331–32; see also 29 C.F.R.
§§ 102.62(b); 102.69(c)(2) (2014).
The Final Rule eliminates the parties’ ability to stipulate that post-election disputes will be
resolved by the Board. 79 Fed. Reg. at 74,331. Instead, “the regional director will resolve any
post-election disputes subject to discretionary Board review.” Id. And the Final Rule provides
that “[t]he Board will grant a request for review only where compelling reasons exist therefor,”
such as: where a petitioning party has shown that (1) “a substantial question of law or policy is
raised;” (2) “the regional director’s decision on a substantial factual issue is clearly erroneous;”
(3) “the conduct of any hearing or any ruling made in connection with the proceeding has resulted
in prejudicial error;” or (4) “there are compelling reasons for reconsideration of an important Board
rule or policy.” 29 C.F.R. § 102.67(d). 30
Both the Chamber plaintiffs and the Baker plaintiffs assert that the Final Rule’s
“elimination of mandatory Board review of post-election disputes, during a period of dramatically
30 The presentation of this issue is yet another example of plaintiffs’ blatant
mischaracterization of the regulations under review. The Chamber plaintiffs allege that “the Final
Rule . . . eliminates mandatory Board review of post-election disputes, making such review
discretionary only.” Chamber Compl. ¶ 18. And the Baker plaintiffs complain that it “eliminates
employers’ automatic right to post-election Board review (post-election review would now be
discretionary).” Baker Am. Compl. ¶ 4(g). But there was no “mandatory” or “automatic” Board
review before – there was only the option that the employer and union could agree to mandatory
review, as part of a broader stipulation waiving the pre-election hearing altogether. See 29 C.F.R.
§ 102.62(b) (2014). Otherwise, Board review was already discretionary. And plaintiffs do not
stop there: in paragraph 72 of their complaint, the Chamber plaintiffs also allege that the Final
Rule “deprives employers of due process in NLRB representation case proceedings, in violation
of the Fifth Amendment, by preventing employers from litigating issues of voter eligibility and
inclusion at the pre-election hearing, and then denying the employer the right to seek any Board
review of those issues, whether pre- or post-election, by making all Board review discretionary.”
Chamber Compl. ¶ 72. Paragraph 22 of the Baker amended complaint is identical. Baker Am.
Compl. ¶ 22. But the Board did not “make” something that was already discretionary
discretionary, and even if it eliminated the one mechanism under which it could become
mandatory, “making Board review discretionary” is not the same thing as “denying the employer
the right to seek any Board review.” The right to seek Board review remains as it was.
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reduced case loads, is arbitrary and capricious given the Board’s statutory obligation to oversee
the election process.” Chamber Compl. ¶ 83; Baker Am. Compl. ¶¶ 34–35. The Chamber
plaintiffs warn that “without the failsafe of mandatory post-election review, employers will be
more reluctant to enter into binding election agreements,” Chamber Mot. at 35, and they contend
that the Final Rule “will result in more, not less, litigation overall, including more litigation in
federal court,” Chamber Compl. ¶ 84; Baker Am Compl. ¶ 36, because it “will force more
employers to turn to the federal courts for the review that is denied by the Board.” Chamber Mot.
at 36. But the only support plaintiffs marshal for these predictions is the dissenting opinion to the
Final Rule. See id., citing 79 Fed. Reg. at 74,451 (dissent). Plaintiffs point to no authority that
demands that every agency action be unanimous, and the fact that individual Board members were
outvoted on a matter of policy does not mean that the Board overlooked “evidence” in the record.
Upon review of the Final Rule as a whole, the Court finds that the Board gave substantial
consideration to this and other issues in deciding to eliminate parties’ ability to stipulate to
mandatory Board review, and that its analysis evidences a rational connection between the facts
the Board found and the choice it made.
The Board determined that it was appropriate to eliminate the parties’ ability to stipulate
to mandatory Board review based on the following findings:
x All pre-election review and most post-election review, absent a stipulated
election agreement, was already discretionary, and the Final Rule would
standardize the process for requesting review across all stages of the
election;
x The Board has affirmed “the vast majority of post-election decisions” made
by regional directors, in light of the “highly deferential standard that the
Board employs” in reviewing such decisions; and
x A discretionary review system will provide a full opportunity to raise
contested issues, while conserving Board resources and promoting
efficiency by eliminating the unnecessary review of meritless disputes.
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79 Fed. Reg. at 74,331–32.
Plaintiffs maintain that the Final Rule contravenes the Board’s “statutory obligation to
oversee the election process,” Chamber Compl. ¶ 83; Baker Am. Compl. ¶¶ 34–35, but the Board
found it was not “abdicating its statutory responsibility and function,” because section 153 of the
NLRA expressly provides for the delegation of the Board’s authority to its regional directors. 79
Fed. Reg. at 74,332, quoting 29 U.S.C. § 153(b). Further, because the rules had long provided that
pre-election disputes were subject only to discretionary review, and that decision had been upheld
by the Supreme Court, the Board found that it was “clearly permit[ted] . . . to adopt the final rule’s
amendments concerning post-election review.” Id. at 74,332–33, citing Magnesium Casting Co.
v. NLRB, 401 U.S. 137, 141–42 (1971) (rejecting employer’s contention that “plenary review by
the Board of the regional director’s unit determination is necessary at some point” and holding that
“the fact that the Board has only discretionary review of the determination of the regional director
creates no possible infirmity within the range of our imagination”). These findings are consistent
with the statute and controlling authority.
Plaintiffs expressed concern that “employers will be more reluctant to enter into binding
election agreements” if they cannot stipulate to mandatory post-election Board review, and that
litigation will increase as a result. Chamber Mot. at 35; see also Chamber Compl. ¶ 84; Baker
Am. Compl. ¶ 36. But the Board considered these arguments, and it predicted that the calculus of
whether to litigate pre-election issues or enter into an election agreement would remain the same
under the Final Rule as it did under the prior regime: parties will weigh “the likelihood of success,
the importance of the issue, and the cost of litigation.” 79 Fed. Reg. at 74,334. Because pre-
election agreements enable parties “to avoid[] the time, expense and risk associated with a pre-
election hearing” and provide “certainty with respect to the unit description and the election date,”
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the Board concluded that “parties will continue to have ample reason to enter into stipulated
election agreements” under the Final Rule. Id.
The Board also found that it was “at best, highly speculative” that employers will refuse to
bargain in order to obtain judicial review of regional directors’ decisions, resulting in an increase
in federal court litigation. Id. It observed that the Final Rule “merely applies precisely the same
standard to post-election review” as was already in place for pre-election review, and that there
was no such influx of federal court litigation despite the fact that all pre-election review is, and
long has been, discretionary. Id. at 74,427.
While plaintiffs may believe that the Board’s analysis of this issue is not sufficiently
sensitive to their concerns, they do not point to any evidence, let alone any evidence that was
before the Board during the rulemaking process, that contradicts the Board’s findings or that
should have led the Board to a different conclusion. Accordingly, given the Board’s consideration
of plaintiffs’ concerns during the rulemaking process, the rational connection between the Board’s
findings and its decision, and the deferential standard of review, the Court finds that the Board’s
decision to eliminate the parties’ ability to stipulate to mandatory Board review of post-election
disputes was not arbitrary and capricious. 31
31 Both complaints include a conclusory allegation that this aspect of the Final Rule infringes
employers’ due process rights. See Chamber Compl. ¶ 72 (“The Final Rule also deprives
employers of due process . . . by preventing employers from litigating issues of voter eligibility
and inclusion at the pre-election hearing, and then denying the employer the right to seek any
Board review of those issues, whether pre- or post-election, by making all Board review
discretionary.”); see also Baker Am. Compl. ¶ 22. But plaintiffs take this issue no further in their
summary judgment memoranda, and the Supreme Court has already recognized the Board’s
authority to prescribe discretionary review. See Magnesium Casting Co., 401 U.S. at 141–42. So
plaintiffs challenge to this aspect of the Final Rule on Fifth Amendment grounds also fails.
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III. The Challenge to the Entire Final Rule as Arbitrary and Capricious
Finally, both sets of plaintiffs contend that the Final Rule – when reviewed as a single
comprehensive rule change and not as the set of its component parts – must be invalidated because
it is arbitrary and capricious. Chamber Compl. ¶¶ 76–86; Chamber Mot. at 31–39; Baker Am.
Compl. ¶¶ 28–38. Indeed, counsel for the Chamber plaintiffs stated that their “primary position”
is that the entire Final Rule “fail[s] . . . under the arbitrary and capriciousness inquiry, in that . . . the
rule as a whole is a vastly overbroad solution to a very narrow problem.” Hr’g Tr. 7:21–25.
Plaintiffs complain that “[t]he Final Rule promotes speed in holding elections at the
expense of all other statutory goals and requirements.” Chamber Compl. ¶ 81; Baker Am. Compl.
¶ 32. The Chamber plaintiffs tell the Court that “[t]he Final Rule is overly broad in changing
election procedures in a manner impacting all cases” and in “seek[ing] to arbitrarily expedite the
election process, even though . . . the Board already conducts elections below its established time
targets in more than 90 percent of cases.” Chamber Compl. ¶¶ 78–79; see also Chamber Mot. at
32. The Baker plaintiffs agree that the Final Rule is not “necessary,” in light of the speed with
which the vast majority of elections were already being resolved prior to the Final Rule. Baker
Am. Compl. ¶¶ 29–30; Hr’g Tr. at 73:5–19.
But this argument presupposes that the lone goal of the Final Rule was speedier elections,
and that is not the case. Many of the Final Rule’s provisions, including the Posting Requirement,
the Employee Information Disclosure Requirement, and the sections providing for electronic
transmission and filing of elections materials, do not relate to the length of the election cycle. And
the Board found that the Final Rule was necessary to further a variety of permissible goals and
interests beyond speed:
Especially as to contested cases, current procedures result in duplicative,
unnecessary and costly litigation. Simplifying, streamlining and, in some
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cases, bolstering these procedures will reduce unnecessary barriers to the
fair and expeditious resolution of representation disputes and result in more
fair and accurate elections. The rule also codifies best practices to ensure
that our procedures are more transparent and uniform across regions.
Changes to the representation case procedures are also necessary to update
and modernize the Board’s processes in order to gain the advantages of and
make effective use of new technology, especially affecting communications
and document retrieval and transmission. These changes will enhance the
ability of the Board to fulfill its statutory mission.
79 Fed. Reg. at 74,315.
Expedition is a valid concern, well within the Board’s purview, but the Final Rule makes
clear that it was aimed not only at increasing the speed and efficiency with which representation
elections are carried out, but that it was also designed to increase transparency and uniformity, to
ensure more fair and accurate voting, and to adapt the Board’s rules to modern technology. Id.
These goals all further the Board’s mandate to “adopt policies and promulgate rules and
regulations in order that employees’ votes may be recorded accurately, efficiently and speedily.”
A.J. Tower, 329 U.S. at 331. There is nothing improper about an agency attempting to improve its
regulatory scheme, even if its processes have been working relatively effectively. Accord
Associated Builders, 2015 WL 3609116, at *17. So while some of the changes may have the effect
of expediting the elections timeline, those provisions accord the regional directors considerable
discretion to adapt to specific circumstances, and they have been individually upheld by this Court,
as discussed above, in part because there were other permissible objectives underlying the decision
to adopt the Final Rule as a whole that were entirely unrelated to speed. The Court therefore rejects
plaintiffs’ contention that the Board acted arbitrarily by expediting elections “at the expense of all
other statutory goals and requirements.” See Chamber Compl. ¶ 81; Baker Am. Compl. ¶ 32.
The Chamber plaintiffs also assert that “the Board cannot create a rule to ‘defeat a
bogeyman’” – here, unnecessary delays in representation elections – “whose existence was never
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verified.’” Chamber Mot. at 32–33, quoting Sorenson Commc’ns, Inc. v. FCC, 755 F.3d 702, 710
(D.C. Cir. 2014). In the Sorenson case, the D.C. Circuit found that an FCC rule which imposed
sales charges on phones manufactured for the hearing impaired, in order to deter fraudulent use of
that equipment, was arbitrary and capricious because the agency had “offer[ed] no evidence
suggesting there is fraud to deter.” 755 F.3d at 707, 709–10. Here, the Board has offered evidence
to support the need for the Final Rule – it considered not only the fact that some elections were
being unnecessarily delayed in fully-litigated cases, 79 Fed. Reg. at 74,317–18, but also that “some
rules have become outdated as a result of changes in communications technology and practice,”
that its election processes had not been updated despite those changes, and that best practices were
not being implemented uniformly across its regions. Id. at 74,308, 74,315–16. Accordingly,
unlike in Sorenson, the Board has offered grounds to show that the issues targeted by the Final
Rule were sufficiently tangible to warrant action, and the Court cannot find that the Board acted
arbitrarily or capriciously in reaching that determination.
CONCLUSION
The NLRA declares it to be “the policy of the United States” to facilitate the free flow of
commerce “by encouraging the practice and procedure of collective bargaining and by protecting
the exercise by workers of full freedom of association, self-organization, and designation of
representatives of their own choosing, for the purpose of negotiating the terms and conditions of
their employment or other mutual aid or protection.” 29 U.S.C. § 151. And in enacting that statute,
Congress authorized the Board “to make, amend, and rescind . . . such rules and regulations as
may be necessary to carry out the provisions” of the NLRA. Id. § 156. Plaintiffs complain that
“[t]he hundreds of pages in the Board’s Final Rule contain remarkably little logic or sound
explanation for the sweeping changes made by the Final Rule,” Chamber Mot. at 31, but in reality,
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the Board engaged in a comprehensive analysis of a multitude of issues relating to the need for
and the propriety of the Final Rule, and it directly addressed the commenters’ many concerns,
including a number of the arguments plaintiffs raised here. Since plaintiffs have not shown that
the Final Rule contravenes either the NLRA or the Constitution, or that the Final Rule is arbitrary
and capricious or an abuse of Board discretion, plaintiffs’ motion for summary judgment will be
denied, and the Board’s motion for summary judgment will be granted.
A separate order will issue.
AMY BERMAN JACKSON
United States District Judge
DATE: July 29, 2015
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