• The Supreme Court recently resolved a split among circuits regarding the standards that the National Labor Relations Board (NLRB or “Board”) must meet to obtain a temporary injunction pending resolution of its underlying case before the Board.
• The NLRB can no longer take advantage of the broad deference that permitted it to obtain relief by presenting plausible evidence sufficient to find (1) reasonable cause to believe that an unfair labor practice had been committed and (2) that relief was necessary to restore the status quo so as to preserve the ultimate remedial power of the Board.
• The NLRB now faces the same high hurdles as any other litigant seeking equitable relief before reaching full adjudication. They must “make a clear showing” that (1) they are likely to succeed on the merits; (2) the union or organizing effort is likely to suffer irreparable harm without relief; (3) the balance of equities tips in their favor; and (4) an injunction is in the public interest.

Overview:

On June 13, 2024, the Supreme Court resolved a long-standing split among circuit courts when it issued a ruling in a high-profile labor dispute between Starbucks and the NLRB. The case originated in Memphis, Tennessee, where, in 2022, several employees invited a news crew into a Starbucks store for a media event to promote their union-organizing efforts. The stunt occurred after hours, which was a violation of company policy. The employees were fired for the violations, after which the union with which they had been coordinating filed unfair-labor-practice charges against Starbucks. The NLRB investigated the charges and issued a complaint.

While the case was making its way through the lengthy adjudication process prescribed by the National Labor Relations Act (NLRA or “Act”), the NLRB sought temporary injunctive relief in federal district court under Section 10(j) of the Act. In evaluating the case, the district court applied the now-defunct two-part standard. Pursuant to that test, the NLRB had to prove only that relief was necessary to preserve the remedial powers of the Board and that its legal theory was substantial and non-frivolous – a bar so low that almost any allegations that rose above absurdity could meet it. The district court granted the injunction.

On appeal, the Sixth Circuit applied the same standard and affirmed. At the Supreme Court, Starbucks argued that the NLRB was entitled to no more deference than any other litigant seeking the extraordinary relief of a temporary injunction prior to a full adjudication on the merits. The Supreme Court agreed.

Countless statutes provide litigants with the option of seeking temporary relief, and the traditional four-factor test applies to most of them. Only where Congress has specifically included language to alter the test has a different standard been applied. Despite the NLRB’s urging, nothing in the language of the NLRA led the justices to believe that Congress intended a different standard to apply to Section 10(j) injunctions.

Now that the NLRB has to make a clear showing of the four traditional factors to obtain a preliminary injunction, its batting average in obtaining such relief is likely to shrink considerably. No longer can the NLRB glide past a stringent balancing of equities by merely presenting non-frivolous arguments and its own interpretation of the facts.

Employers defending against petitions for temporary relief under Section 10(j) of the Act should reach out to their Foley Hoag labor attorney for advice on the best way to quash it under this standard newly established nationwide.