Labor & Employment Law Daily Wrap Up, PROCEDURE—D.D.C.: Court had jurisdiction of employee’s challenge to constitutionality of NLRB removal protections; but challenge fails, (Mar 24, 2025)

By Ronald Miller, J.D.

The employee asserted that the NLRB members’ for-cause removal protections violate the Constitution, such that he is subjected to “an illegitimate proceeding, led by an illegitimate decisionmaker.”

A federal district court in the District of Columbia determined that it had jurisdiction over an employee’s claim that the NLRB members’ statutory removal protections are unconstitutional. The employee’s “subjection to an unconstitutionally structured decisionmaking process” produces an injury for which judicial review before a circuit court after the case before the NLRB is complete “would come too late to be meaningful.” However, the court concluded that the employee’s claim failed because he did not plead facts demonstrating harm that entitled him to relief, and he had failed to plead facts that he suffered harm from any removal protections (Avila v. NLRB, No. 24-1688 (RC) (D.D.C. Mar. 19, 2025)).

On August 22, 2023, the employee filed an unfair labor practice charge with the NLRB, alleging that a union local engaged in unfair labor “by threatening employees with physical violence for not supporting the [u]nion.” On June 11, 2024, an NLRB administrative law judge held a hearing on the complaint. While the administrative action was pending, the employee filed this lawsuit seeking declaratory judgment that NLRB members’ statutory removal protections are unconstitutional. Specifically, he alleged that statutory limitations on the President’s power to remove NLRB members violates Article II of the Constitution and separation of powers. He then moved for summary judgment on those grounds.

On September 20, 2024, the NLRB opposed the motion, and also moved to dismiss the complaint, arguing that the court lacked jurisdiction, that the issue was not prudentially ripe, and that the employee failed to allege that the Board members’ removal protections cause him actual harm.

Jurisdiction. Although the NLRB argued that D.C. Circuit precedent precludes the court’s exercise of jurisdiction, the court observed that the Supreme Court’s recent decision in Axon Enterprise, Inc. v. Federal Trade Commission, 598 U.S. 175 (2023), supported its jurisdiction to consider the issue of removal protections.

The employee’s complaint collaterally attacked the NLRB’s structure while his unfair labor practice case proceeds through the administrative process. The Board argued that Congress sought to funnel the employee’s claim through the NLRB initially, with judicial review available following the NLRB’s final decision. Specifically, the NLRB argued that the D.C. Circuit held in Jarkesy v. Securities & Exchange Commission, 803 F.3d 9 (D.C. Cir. 2015), that the agency has exclusive jurisdiction over the controversy—including certain constitutional challenges—in the first instance.

For his part, the employee responded that Axon represents on-point precedent and supports the court’s jurisdiction over the collateral attack here.

Administrative proceedings. In Jarkesy, the D.C. Circuit concluded that Congress sought “to preclude suits by respondents in SEC administrative proceedings. It held that Congress included a detailed structure for reviewing violations, barring a district court from exercising subject matter jurisdiction over a pre-enforcement challenge to the Act. This meant that Congress intended for the plaintiff’s challenge to flow through SEC proceedings.

For-cause removal protections. In contrast, in Free Enter. Fund v. Pub. Co. Acct. Oversight Bd., 561 U.S. 477, 489 (2010), an accounting firm contended that an oversight board’s members’ for-cause removal protections were unconstitutional because the members could be hired and fired only by the SEC, which also enjoyed for-cause removal protections. The Supreme Court held that the district court had jurisdiction in the first instance over the challenge to the oversight board’s structure.

Thereafter, the Supreme Court followed the same basic script when considering a similar issue in Axon. There, the Court held that all three Thunder Basin factors,” Thunder Basin Coal Co. v. Reich, 510 U.S. 200 (1994), supported the district court’s jurisdiction over whether “the structure, or even existence, of an agency violates the Constitution.”

Here, the court determined that the employee’s challenge is more akin to the structural issues raised in Free Enterprise Fund and Axon. The employee asserted that the NLRB members’ for-cause removal protections violate the Constitution, such that he is subjected to “an illegitimate proceeding, led by an illegitimate decisionmaker.” The employee’s “subjection to an unconstitutionally structured decisionmaking process” produces an injury for which judicial review before a circuit court after the case before the NLRB is complete “would come too late to be meaningful.” Finally, his claims regarding Article II of the Constitution and separation of powers lie “outside the [NLRB’s] expertise.” The court therefore found that it had jurisdiction over the employee’s separation-of-powers claim, and that he need not bring it to the NLRB in the first instance.

Merits. However, the employee’s claim failed on the merits because he did not plausibly plead that the NLRB’s removal protections caused him actual harm for which the court may provide relief under Collins v. Yellen, 594 U.S. 220 (2021).

After Collins, courts have concluded that a plaintiff must demonstrate an official lacked the authority to make a decision in order to obtain either “retrospective or prospective relief” of any kind. Here, the employee argued that Collins does not bar declaratory relief in separation-of-powers challenges. However, every court of appeals that has dealt with this claim has recognized that the Supreme Court’s reasoning in Collins ‘applies with equal force regardless of the relief sought.’” “The Collins inquiry focuses on whether a ‘harm’ occurred that would create an entitlement to a remedy, rather than the nature of the remedy.”

In this instance, the employee pled no facts showing harm and made no argument that he had met his burden. Accordingly, the employee’s complaint was dismissed for failure to state a claim.

The case is No. 24-1688 (RC).

Judge: Contreras, R.

Attorneys: Aaron Solem (National Right to Work Legal Defense and Education Foundation) for Victor Avila. Christine Flack for NLRB.

Cases: Procedure Labor AgencyNews DistrictofColumbiaNews