As we previously reported, the United States Court of Appeals for the D.C. Circuit in Noel Canning v. NLRB, 705 F.3d 490 (D.C. Cir. 2013) struck down President Barack Obama’s “recess appointments” of three members of the National Labor Relations Board (“Board”) as unconstitutional, placing into question the legitimacy of numerous (mostly pro-union/employee) decisions issued during 2012.  On November 15, the United States Court of Appeals for the Eleventh Circuit, in an unpublished opinion, came to a contrary decision, rejecting an employer’s challenge to the Board’s authority to act with respect to its order finding that the employer had committed various unfair labor practices.  Ambassador Services, Inc. v. NLRB, Case No. 12-15124 (11th Cir. Nov. 15, 2013).

Ambassador Services, Inc. (“Ambassador”) is a Florida corporation with an office in Cape Canaveral, Florida, engaged in providing stevedoring services at Port Canaveral, Florida.  An administrative law judge (“ALJ”) with the Board found that Ambassador violated the National Labor Relations Act (“NLRA”) by maintaining an unlawfully broad rule prohibiting unauthorized solicitation and/or distribution of literature, informing employees that it had assisted with a petition to decertify the International Longshoremen’s Association (“Union”) as its employees’ collective-bargaining representative, soliciting employees to sign a petition to decertify the Union, and informing employees that they could not solicit or distribute literature on the property at which they were working.  The ALJ also found that Ambassador had committed an unfair labor practice by failing and refusing to recognize and bargain with the Union.  Subsequently, in a 2012 Decision and Order, the Board affirmed the ALJ’s findings described above; however, it further found that Ambassador had violated the NLRA by unlawfully interrogating employees about their union sympathies and by maintaining a work rule prohibiting “walking off the job and/or leaving the premises during working hours without permission.”

On appeal to the Eleventh Circuit, Ambassador asserted that the Board lacked a quorum to issue its order because at the time it was issued, three of its five members were intrasession recess appointments made without the U.S. Senate’s consent.  The appellate court rejected Ambassador’s argument based upon its prior decision in Evans v. Stephens, 387 F.3d 1220 (11th Cir. 2004), in which the court upheld President George W. Bush’s intrasession appointment of a judge to (ironically) the Eleventh Circuit based upon the Constitution’s Recess Appointments Clause.  The court noted:

“While there are certainly some differences between this Court’s opinion in Evans and this case, the reasoning in Evans persuades us that Ambassador’s quorum claim lacks merit and that the authority of the Board to act does not affect our subject matter over the merits issues in this case.”

Turning to the merits of the case, the court found that there was substantial evidence to support the Board’s determinations as to Ambassador’s commission of various unfair labor practices.   Based upon its findings, the Eleventh Circuit denied Ambassador’s petition for review and granted the Board’s cross-petition for enforcement of its order in full.

Take Aways

The Ambassador Services decision places the Eleventh Circuit – generally considered one of the more pro-employer circuits in the area of labor and employment law – on the side of the Board, the Obama administration, and its union supporters, and directly in opposition to the D.C., Third, and Fourth Circuits (all of which previously have found the appointments unconstitutional).   The U.S. Supreme Court should resolve the issue this term, when it reviews the D.C. Circuit’s Noel Canning case.  Oral argument in that case is scheduled for January 13, 2014.

The ultimate resolution of this issue by the Supreme Court will have far-reaching implications for many disputes that came before the Board in 2012, the general state of the law governing employers and unions, and the limits of the President’s power vis-à-vis Congress.   Thus, it is well worth watching what the Court does in this case in the coming months.