Authority of NLRB’s Former Acting General Counsel Challenged

By Allen Smith, J.D. Jul 12, 2016
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Congress passed the Federal Vacancies Reform Act ​to prevent the president from bypassing the Senate confirmation process.

A tug of war between Congress and the president is brewing, and the National Labor Relations Board (NLRB) is at the heart of the battle. The dispute centers on whether an acting NLRB general counsel had authority to serve in that temporary capacity once he was nominated to fill the position.

The Supreme Court has agreed to resolve the conflict.

Lafe Solomon, the NLRB's acting general counsel from June 21, 2010, to Nov. 4, 2013, became ineligible to serve in that capacity once he was nominated in January 2011 to be general counsel, an employer asserted in a case that the Supreme Court has said it will review. The case pits the president's power to nominate acting officials against Congress, which enacted the Federal Vacancies Reform Act of 1998 (FVRA) to prevent the president from using the ability to make appointments as a way to bypass the Senate approval process.

"Many recess appointments are made since it is difficult to have folks confirmed quickly," said Michael Lotito, an attorney with Littler in San Francisco and co-chair of the firm's government relations branch, the Workplace Policy Institute. The average lag time between vacancy and confirmation is 190 days, according to the U.S. Court of Appeals for the D.C. Circuit, which agreed with the employer in this case, stating that Solomon became ineligible under FVRA to serve as acting general counsel as of January 2011.

The case presents "a broad administrative issue that impacts the role of the executive versus the confirmation authority of the Congress when confronted with a nomination," Lotito said.

Unfair Labor Practices Held Void

This case originated in December 2012 when SW General Inc. (Southwest), a provider of ambulance services to Arizona hospitals, stopped paying "longevity bonuses" after the collective bargaining agreement expired but before the parties negotiated a replacement contract. Employees who had been with the company for at least 10 years had guaranteed bonuses up until that point.

The union filed an unfair labor practices charge with the NLRB. Regional Director Cornele Overstreet issued a formal complaint on Jan. 31, 2013. An administrative law judge then agreed that Southwest had committed an unfair labor practice. Southwest appealed, alleging that Solomon was serving as acting general counsel in violation of FVRA and that the unfair labor practice charge therefore was void. (Solomon became involved because the board cannot adjudicate an unfair labor practice dispute until the general counsel issues a formal complaint. The general counsel has delegated his authority to issue complaints to the board's regional directors.) In May 2014, the NLRB rejected Southwest's argument and adopted the administrative law judge's order.

However, Southwest appealed to the D.C. Circuit, which agreed with the company's contention that once Solomon was nominated in January 2011 to serve as general counsel, he became ineligible to serve as acting general counsel. The D.C. Circuit interpreted FVRA as prohibiting a nominee from serving as an acting official if for a year prior to the date of the predecessor's departure, the person was not a first assistant for at least 90 days. Solomon was never a first assistant, the court emphasized, thus vacating the board's order against Southwest.

Board's Position Rejected

The board unsuccessfully argued that the statute's bar on nominees becoming acting officials did not apply to senior officials in the same agency with at least 90 days of service in the preceding year. Solomon had become acting general counsel after serving as a senior agency employee for 10 years.

The Department of Justice's Office of Legal Counsel has interpreted the statute's language consistently with the board's interpretation, noted Patricia Wise, an attorney with Niehaus Wise & Kalas in Toledo, Ohio, and a member of the Society for Human Resource Management's Labor Relations Special Expertise Panel. So has the Government Accountability Office.

"In accordance with that interpretation, every president since FVRA's enactment has made nominations premised on that understanding," she said.

The D.C. Circuit's decision raises the question about whether Solomon's authorizations of unfair labor practice complaints from January 2011 through November 2013, when Solomon stepped down from serving as acting general counsel, are null and void. His nomination was not approved by the Senate, and ultimately was withdrawn.

But the D.C. Circuit stated that it did not expect its decision "to retroactively undermine a host of NLRB decisions. We address the FVRA objection in this case because the petitioner raised the issue in its exceptions to the ALJ [administrative law judge] decision as a defense to an ongoing enforcement proceeding. We doubt that an employer that failed to timely raise an FVRA objection—regardless whether enforcement proceedings are ongoing or concluded—will enjoy the same success."

The administration has indicated that there are about a dozen current senior officials in the departments of Defense, Health and Human Services, Justice and Treasury, as well as the Environmental Protection Agency, who could be affected by the Supreme Court's decision, Wise said.

This case is NLRB v. SW General Inc., No. 15-1251.

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