NEW PROCESS STEEL v. NLRB
The union representing employees at a New Process Steel plant in Butler, Indiana failed to reach an agreement over a new contract with New Process Steel. The union subsequently filed unfair labor practices claims with the National Labor Relations Board ("NLRB") arguing that New Process Steel failed to honor its collective bargaining agreement to deal with the union as the exclusive representative of employees of the plant. A two-member panel of the NLRB agreed with the union. On appeal, New Process Steel argued that the NLRB's decision was invalid because 29 U.S.C. § 153(b) of the National Labor Relations Act requires that three members of the five member National Labor Relations Board shall "at all times" constitute a quorum.
The U.S. Court of Appeals for the Seventh Circuit disagreed and affirmed the judgment of the board. The court held that the NLRB had power to delegate its authority to a group of three of its members. In which case, two sitting members constituted a quorum. Therefore, the NLRB appropriately rendered its decision.
Does the NLRB have the authority to decide cases with only two sitting members, when 29 U.S.C. § 153(b) provides that "three members of the Board shall, at all times, constitute a quorum of the Board?"
No. The Supreme Court held that the NLRBA requires that when the Board delegates its authority, the delegated group must maintain a membership of three in order to exercise the delegated authority of the Board. With Justice John Paul Stevens writing for the majority, the Court reasoned that the plain language of the statute – the Board may delegate its powers to a "group of three or more members" – required that the delegated group must have at least three members to exercise such authority.
Justice Anthony M. Kennedy, joined by Justices Ruth Bader Ginsburg, Stephen G. Breyer, and Sonia Sotamayor, dissented. He criticized the majority for calling into question the more than 500 cases the NLRB address during the 26 months it carried out its responsibilities with only two members. He also disagreed with the manner in which the majority reached its conclusion.
Chief Justice Mr. Chief Justice Robert Jr.: He does however have our next announcement case 08-1457; New Process Steel versus The National Labor Relations Board.
Justice John Paul Stevens: In December of 2007, The National Labor Relations Board had one vacancy and four members.
The board expected two more members, two more vacancies at the end of the year just a few away, which would leave the Board with only two members.
Too few to meet the quorum requirement in The National Labor Relations Act which requires three members.
The four sitting members attempted to preserve the Board’s ability to function by delegating all of the Board’s powers to a group of three members with the expectation that when the term expired for one of the group members a few days later, the remaining two members could continue to issue decisions, as a quorum of that three-member group.
For the next 27 months, the Board issued decisions with only two members.
Petitioners sought review of two of those decisions challenging the authority of the two member board to act.
The Seventh Circuit ruled that the government including that the two members could properly act for the entire board.
We granted certiorari to resolve the circuit split on this issue.
For the reasons stated in opinion filed with the clerk, we hold that the two remaining board members could not exercise the board’s authority.
The portion of the Act that allows the board to delegate its authority to a group of no fewer than three members must be read to require that the group maintain a membership of three in order to continue to exercise the board’s powers.
The contrary reading allowing two members to exercise authority as a quorum of the defunct three-member group would allow permanent circumvention of a quorum requirement for the board which demands three members.
We therefore reverse the judgment of the Court of Appeals.
Justice Kennedy has filed a dissenting opinion in which Justice Ginsburg, Justice Breyer and Justice Sotomayor have joined.