U.S. Chamber Sues NLRB to Block Notification Rule

Tuesday, September 20, 2011 | Press Release

Lawsuit Says Rule is an Unlawful Abuse of the Regulatory Process, and is Unconstitutional

WASHINGTON D.C.—The U.S. Chamber of Commerce and the South Carolina Chamber of Commerce filed a lawsuit against the National Labor Relations Board (NLRB) challenging the Board’s new rule requiring businesses to post notices explaining employees' rights to unionize. The Chamber’s lawsuit alleges that the misguided NLRB rule violates federal labor and regulatory laws as well as the First Amendment. The case, Chamber of Commerce, et al. v. National Labor Relations Board, et al. is in the U.S. District Court of South Carolina.

“The NLRB has no authority to impose any of these requirements,” said Robin Conrad, executive vice president of the National Chamber Litigation Center, the Chamber’s public policy law firm. “This is nothing more than labor regulation run amok. Adding insult to injury, the Board’s new rule violates the First Amendment by forcing employers to use their own resources to post the NLRB’s pro-union message on the company’s own property.”

The Chamber’s lawsuit alleges that the NLRB’s final rule regarding Notification of Employee Rights Under the National Labor Relations Act (“Notification Rule”) violates the National Labor Relations Act (NLRA), the Administrative Procedure Act (APA), the Regulatory Flexibility Act (RFA), and the First Amendment. Significantly, the rule creates a new “unfair labor practice,” exposing businesses to significant and costly liability for failure to comply. The Rule -- which applies to virtually all private employers in the United States -- becomes effective on November 14, 2011.

“At a time when the private sector is striving to create desperately needed new jobs, it is disappointing to see that the NLRB is imposing new and unnecessary regulations on employers,” said Randy Johnson, the Chamber’s senior vice president of Labor, Immigration, and Employee Benefits. “The latest rule is part of the NLRB’s pattern of tipping the scale in favor of unions, at the expense of employers and employees alike.” 

According to the Chamber’s lawsuit:

  • Nowhere does the NLRA give the NLRB authority to coerce employers to post such notifications, or to impose onerous penalties for those who fail to post the notices.
  • In violation of the APA, the rule arbitrarily and capriciously excludes from the mandatory notice a description the fundamental rights of employees to be free of compulsory union membership and compulsory union dues.
  • The NLRB violated the RFA by failing to properly assess the significant economic impact the rule would have on small businesses.
  • The rule violates the First Amendment by compelling employers to post the NLRB’s ideological views on unionizing.
  • The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.