Corrected: Business group contests Obama labor appointments

Tue Jan 17, 2012 10:34am EST

Related Topics

(Reuters) - In the first legal challenge to last week's recess appointments by the Obama administration, a U.S. lobbying group for small businesses said on Friday it is contesting the naming of three members to the U.S. National Labor Relations Board.

Alleging that the appointments violated the Constitution, the National Federation of Independent Business is seeking to add the appointments challenge onto an earlier legal action it already had pending against the NLRB over a different issue.

"NFIB takes this action today to ensure that its members are protected from unconstitutional acts," said Karen Harned, executive director of NFIB's Small Business Legal Center.

White House spokesman Eric Schultz defended the appointments, saying the president can make "temporary recess appointments ... when the Senate is in recess."

He said the Senate has effectively been in recess for weeks, but that Republicans are using gimmick "pro forma" sessions - in which a Senate session opens and closes within seconds but no business is done - to try to block recess appointments.

"Gimmicks do not override the president's constitutional authority to make appointments," Schultz said.

The lobbying group's challenge is being made in U.S. District Court in Washington, D.C., where the NFIB and other business groups were already suing the labor board over a rule that would require employers to display a poster explaining workers' rights to unionize.

The NFIB - which says it represents 350,000 small businesses across the country - is asking to supplement that complaint, first filed in September and in the early stages of litigation.

The general counsel's office at the NLRB said it had not seen the new challenge and had no comment.

DIVISION AMONG BUSINESS GROUPS

Not everyone involved in the lawsuit over the organizing rights poster supports adding on the appointments challenge.

The National Association of Manufacturers, another business lobbying group that is a plaintiff in the original action, did not sign on to the NFIB's latest court filings.

"We remain focused on the posting requirement lawsuit against NLRB," said Jeff Ostermayer, a spokesman for the manufacturers group, in an email to Reuters.

It is possible that the judge in the case, Judge Amy Berman Jackson, will not immediately consider the constitutionality of the recess appointments. She had been expected to rule soon on a request by the labor board to dismiss the poster lawsuit and if she is close to a decision, she may decline to hear a new issue, said John Raudabaugh, a lawyer representing the NFIB.

Raudabaugh said the NFIB plans to pursue the constitutional argument over the appointments, nevertheless, because it is central to the underlying question of whether the labor board has the authority to implement the new "poster rule."

"That's an official action of the agency, and the question is: Are there a minimum of three board members serving with statutory authority?" said Raudabaugh, a counsel at Nixon Peabody LLP in Washington. He once served on the labor board.

If the recess appointments were to be ruled unconstitutional, then the labor board would lack a quorum and would be unable to implement the poster rule and other policies.

The poster rule is set to take effect on April 30.

The U.S. Justice Department on Thursday defended Obama's recess appointments in a detailed legal analysis. It followed furious complaints from Senate Republicans who accused Obama of trampling the Constitution and sidestepping the Senate confirmation process when he installed the NLRB members and a new chief at the U.S. Consumer Financial Protection Bureau.

The NFIB made no mention of Obama's recess appointment of Richard Cordray as head of the consumer watchdog bureau, which he made at the same time as the NLRB appointments on January 4.

(Reporting By David Ingram. Editing by Kevin Drawbaugh, Bernard Orr)

(This January 13 story was corrected in paragraph 15 to change the title of Raudabaugh to counsel)

FILED UNDER: