Hospital Chain Flouts NLRB Order After Court Ruling On Recess Appointments

Last week’s radical federal appeals court ruling that called into question hundreds of presidential recess appointments made over the last 150 years is already taking a toll. While the decision finding unconstitutional President Obama’s appointment last January of three members to the National Labor Relations Board invalidated just one particular NLRB decision, a hospital chain declared this week that the ruling exempts them from all NLRB rulings over the last year, and is refusing to comply with rulings that require them to collect dues from union members, according to a Reuters exclusive:

Prime Healthcare was not a party in the cases involving union dues and internal investigations. But on Friday the company told the SEIU-United Healthcare Workers West that following the D.C. Circuit decision, it would disregard the NLRB rulings.

“The D.C. Circuit’s ruling from last Friday held all the Board’s cases decided by the recess appointments are void,” wrote Prime Healthcare’s assistant general counsel, Mary Schottmiller, in an email to Reuters. “As such, it would violate the law if we followed the Board’s rulings … regarding union dues and witness statements.”

Schottmiller told Reuters that Prime Healthcare’s response to the union needed no further elaboration because the D.C. Circuit’s opinion was clear. “Void is void,” she said, adding that all of the company’s hospitals would take the same legal position on the issue.

Contrary to Schottmiller’s statement, the ruling by the U.S. Court of Appeals for the D.C. Circuit did not hold that all cases decided by the recess appointees are void. It invalidated the one decision before the court, and only that one. The ruling does suggest that all other decisions are more susceptible to court challenge — if the D.C. Circuit’s ruling is not overturned, either on rehearing or by the U.S. Supreme Court. But other federal appeals courts have already come to opposite conclusions about such recess appointments in the past, and are incredibly likely to do the same in the future, so a challenge before another appeals court could have an entirely different outcome. As NLRB Chairman Mark Gaston Pearce pointed out in a statement he issued following the ruling, “It should be noted that this order applies to only one specific case, Noel Canning, and that similar questions have been raised in more than a dozen cases pending in other courts of appeals.”

Although Prime Healthcare is definitively not entitled to defy NLRB orders based on the D.C. Circuit’s decision, the decision does create extreme uncertainty as entities subject to those rulings plan for the future. The ruling calls into question, at the very least, the concurrent appointment by President Obama of Consumer Financial Protection Bureau Director Richard Cordray, and the continuing validity of any other appointment made during an “intrasession” recess.

If the ruling’s reasoning were more broadly adopted, it would not only invalidate all recent NLRB decisions (a quorum of 3 members is required), all CFPB actions that required a director, and potentially affect the functioning of any other agencies with similar recess appointees. It would also so neuter the president’s power to make recess appointments that agencies lacking legally required personnel to do their work would be immobilized, thanks to Senate Republicans’ commitment to block absolutely anybody nominated to positions they’d rather see left empty.