Ground Rules: Supreme Court Affirms the Standard for NLRB Injunctive Relief

By Benjamin A. Nucci and Caitlin E. White

In the latest labor law brew-haha, the U.S. Supreme Court reconciled a circuit split by requiring the National Labor Relations Board (NLRB) to marshal substantial proof to win temporary injunctions against employers for alleged unfair labor practices. The decision weakens what has been one of the NLRB’s most potent tools in recent years during ongoing labor disputes.

Background

The National Labor Relations Act (the Act) prohibits employers and unions from engaging in certain “unfair labor practices.” 29 U.S.C. §§ 158(a), (b). The NLRB enforces the prohibition, and its authority kicks in when a person files a charge with the agency. 29 U.S.C. § 160(a). If the charge appears to have merit, the NLRB issues a complaint triggering adjudicatory proceedings within the agency. Because the administrative proceedings can take years, Section 10(j) of the Act permits the NLRB to seek a preliminary injunction in federal court while the proceedings unfold.

This case percolated from an organizing campaign brewing at one of Starbucks’ Memphis locations. Amid a unionizing drive, several employees invited a news crew from a local television station to visit the store after hours to promote their unionizing effort. Starbucks learned of the event the following day and launched an investigation. Ultimately, Starbucks terminated the employees for violating company policy. The union filed charges with the NLRB. After investigating the complaint, the NLRB obtained a preliminary injunction with the District Court for the Western District of Tennessee that would, among other things, require Starbucks to reinstate the employees.

On appeal, the Sixth Circuit upheld the injunction. The Sixth Circuit was one of a handful of circuits that used a two-factor test examining whether the NLRB had shown “reasonable cause” to believe an employer committed a violation and that it would be “just and proper” for the court to intervene. The two-factor test departed from the four-factor Winter framework used for obtaining injunctions in private litigation, which requires that the party show a likelihood of success on the merits, suffering of irreparable harm without an injunction, that the balance of equities favors injunctive relief, and that an injunction is in the public interest.

Reading the Grounds: Supreme Court’s Bold Statement

In an opinion that roasted the NLRB’s arguments and arguably iced the agency’s litigating strategy, Justice Clarence Thomas opined that nothing in the Act “overcomes the presumption that traditional equitable principles govern,” and that “district courts considering the NLRB’s request for a preliminary injunction must apply the Winter framework, which embodies those traditional principles.” As the decision returns back to the District Court, the NLRB will have to spill the beans and prove all four of the Winter  factors to receive a preliminary injunction reinstating the terminated employees.