Hunton Employment & Labor Perspectives

On April 23, the Supreme Court heard oral argument in Starbucks Corp. v. McKinney, a case which examines what test the federal courts should apply when considering whether to grant preliminary injunctions under Section 10(j) of the National Labor Relations Act. Here’s what employers need to know while waiting for the Court to issue their opinion.

The National Labor Relations Act (the “Act”) allows the NLRB to request a preliminary injunction against an employer in federal court for alleged violations of the Act through a mechanism in Section 10(j).  The procedure allows the NLRB to obtain injunctive relief restoring the status quo ante while the merit of the underlying alleged NLRA violations are litigated before the Board.  In Starbucks v. McKinney, the NLRB requested a 10(j) injunction requiring Starbucks to rehire employees it had allegedly unlawfully fired for letting news crews into the store after the store had closed, while off-duty and without authorization. The NLRB alleged that these workers were fired in violation of the Act. The district court granted the NLRB’s request for a preliminary injunction. The Sixth Circuit affirmed the district court’s finding and the preliminary injunction remained in place.

The Supreme Court in deciding this case will resolve a question regarding the appropriate standard a court should use when deciding whether to grant the NLRB a preliminary injunction. Four Circuits– the Fourth, Seventh, Eighth and Ninth– require the NLRB to meet the same standard as movants in other contexts, as set out in Winter v. NRDC.  Under that standard, courts evaluate: (1) the potential of irreparable harm to the moving party (2) the possible harm to the non-moving party if relief is granted, also referred to as the balance of the equities (3) the moving party’s likelihood of success on the merits, and (4) the public interest. The NLRB, however, takes the position that it is entitled to issuance of a preliminary injunction after meeting a lower standard: showing that it has reasonable cause to believe that the employer has engaged in unfair labor practices and that the injunctive relief is just and proper.

The parties’ arguments provided interesting insight into the Justices’ concerns and likely stances on the issue. Justice Ketanji Brown Jackson spoke in support of the NLRB’s proposed standard, saying the statute gives power to the Board in this particular context to investigate unfair labor practices and decide in the first instance whether ULPs occurred, rendering the context different from other preliminary injunctions. Beyond Justice Jackson’s comments, Starbucks’ position appeared to garner support from both the liberal and conservative justices. Justice Sonya Sotomayor noted that Starbucks was correct that a court should be deciding the NLRB’s likelihood of success on the merits without deference to the Board. Justice Neil Gorsuch noted that allowing the NLRB to obtain an injunction by meeting a lower standard would be unusual compared to the way courts handle other agencies.

The Justices showed support for Starbucks’ position throughout oral argument. Should the court rule in Starbucks’ favor and hold that the NLRB must satisfy the four-prong test to obtain a preliminary injunction, Employers would benefit from being certain that the NLRB is subject to a uniform standard across jurisdictions as well as the same standard required of other parties seeking the extraordinary relief of a preliminary injunction from a federal court. Employers should be on the look-out for the opinion in the coming months.