Labor & Employment Law Daily Wrap Up, PUBLIC EMPLOYEES—U.S.: Injunctions against NLRB, MSPB member firings stayed, casting doubt on 1935 precedent, (May 27, 2025)

By Jason Albright, J.D.

The Court said arguments in the case do not necessarily implicate the constitutionality of for-cause removal protections for members of the Federal Reserve’s Board of Governors.

The U.S. Supreme Court has stayed two preliminary injunctions against President Trump’s removal of NLRB member Gwynne Wilcox and MSPB member Cathy Harris, in both cases without cause and in violation of their respective agencies’ organic statutes. The Court said the decision “reflects our judgment that the Government is likely to show that both the NLRB and MSPB exercise considerable executive power,” and “that the Government faces greater risk of harm from an order allowing a removed officer to continue exercising the executive power than a wrongfully removed officer faces from being unable to perform her statutory duty.” Justice Kagan, joined by Justices Sotomayor and Jackson, dissented, observing that “our emergency docket, while fit for some things, should not be used to overrule or revise existing law” (Trump v. Wilcox, No. 24A966 (U.S. May 22, 2025)).

Dismissals without cause and reinstatement. Following their dismissals without cause by the President, both Harris and Wilcox were reinstated by the U.S. District Court for the District of Columbia in early March. Judge Rudolph Contreras found that Trump lacked the power to remove Harris from her office at the MSPB at will, and Judge Beryl Howell came to the same conclusion with respect to Wilcox.

D.C. Circuit back-and-forth. The administration filed motions with the D.C. Circuit in both cases, seeking an emergency stay, and the appeals court granted its request in a per curiam order on March 28.

The former members then petitioned for rehearing en banc, which the D.C. Circuit granted, and on April 7, the appeals court issued an order reversing the panel’s decision and denying the government’s motions for a stay pending appeal. This meant that Wilcox and Harris were again reinstated.

Chief Justice’s initial order. Meanwhile, the administration had sought relief from the U.S. Supreme Court, applying on April 9 to stay the judgments of the district court. In an order issued the same day, Chief Justice Roberts granted the administration’s request, “pending further order of the undersigned or of the Court.”

Stay granted. The Court granted that further order on May 22, observing that its stay “reflects our judgment that the Government is likely to show that both the NLRB and MSPB exercise considerable executive power.” The brief per curiam order additionally asserted “that the Government faces greater risk of harm from an order allowing a removed officer to continue exercising the executive power than a wrongfully removed officer faces from being unable to perform her statutory duty.”

Seila Law cited. The Court’s opinion did not mention its 90-year-old precedent in Humphrey’s Executor v. United States, 295 U.S. 602 (1935), which held that Congress has the power to enact laws limiting the President’s ability fire executive officials of an independent agency that is quasi-legislative or quasi-judicial. Instead, the Court asserted that, “[b]ecause the Constitution vests the executive power in the President, see Art. II, §1, cl. 1, he may remove without cause executive of­ficers who exercise that power on his behalf, subject to nar­row exceptions recognized by our precedents, see Seila Law LLC v. Consumer Financial Protection Bureau, 591 U.S. 197, 215−218 (2020).”

The Court in Seila Law had specifically found that for-cause removal provisions applying to independent agencies with a single director violated the separation of powers.

“[D]isruptive effect.” A stay, the Court added, “is appropriate to avoid the disruptive effect of the repeated removal and reinstatement of officers during the pendency of this litigation.”

Federal Reserve carve-out? Finally, the Court took pains to clarify that arguments in the case do not “necessarily implicate the constitutionality of for-cause removal protections for members of the Federal Reserve’s Board of Governors or other members of the Federal Open Market Committee.” Again citing Seila Law, the Court noted, “The Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States.”

Terms of stay. The March 2025 orders of the U.S. District Court for the District of Columbia were accordingly stayed pending the disposition of the appeal in the D.C. Circuit and “disposition of a petition for a writ of certiorari, if such a writ is timely sought.”

Dissent and Humphrey’s Executor. In her dissent, Justice Kagan observed that Humphrey’s Executor “has stood as a precedent of this Court” for 90 years and is “not just any precedent.” The case “undergirds a sig­nificant feature of American governance: bipartisan admin­istrative bodies carrying out expertise-based functions with a measure of independence from presidential control.” Congress created such bodies, Kagan said, based on a “thought that in certain spheres of government, a group of knowledgeable people from both parties—none of whom a President could remove without cause—would make decisions likely to advance the long-term public good.” Indeed, “that congressional judgment, Humphrey’s makes clear, creates no conflict with the Con­stitution.”

Not since the 1950s… Trump, Justice Kagan noted, “believes that Humphrey’s should be either overruled or confined,” and indeed “has chosen to act on that belief—really, to take the law into his own hands.” However, “Not since the 1950s (or even before) has a President, without a legitimate reason, tried to remove an officer from a classic independent agency—a multi-member, bipartisan commission exercising regulatory power whose governing statute contains a for-cause provision.” The present decision, Kagan said, “effectively blesses” Trump’s firing, “concededly without cause,” of several such officers, including both Wilcox and Harris.

Emergency disposition. Justice Kagan also took issue with the impact of the Court’s emergency order on existing Court precedent. “Our emergency docket, while fit for some things,” she observed, “should not be used to overrule or revise existing law.” “And nowhere is short-circuiting our deliberative process less appropriate than when the ruling requested would dis­respect—by either overturning or narrowing—one of this Court’s longstanding precedents, like our nearly century-old Humphrey’s decision.”

“[N]othing short of extraordinary.” The Court’s order, said Kagan, is “nothing short of extraordinary.” It “consents to the President’s (statutorily barred) removal of the NLRB and MSPB Commissioners, at least until we decide their suits on the merits. And so the order allows the President to overrule Humphrey’s by fiat, again pending our eventual review.”

In short, concluded Kagan, the order “favors the Presi­dent over our precedent; and it does so unrestrained by the rules of briefing and argument—and the passage of time—needed to discipline our decision-making.”

“Except apparently for the Federal Reserve.” Finally, Justice Kagan noted that “one way of making new law on the emergency docket (the dep­recation of Humphrey’s) turns out to require yet another (the creation of a bespoke Federal Reserve exception).” The majority, she said, “closes today’s order by stating, out of the blue, that it has no bearing on ‘the constitutionality of for-cause removal protections’ for members of the Federal Reserve Board or Open Market Committee.” And it gets there only by citing a footnote in Seila Law that, she said, “provides no support.” “If the idea is to reassure the markets,” Kagan concluded, “a simpler—and more judicial—approach would have been to deny the President’s application for a stay on the continued authority of Humph­rey’s.”

The case is No. 24A966.

Judge: Per curiam.

Attorneys: D. John Sauer, U.S. Department of Justice, for Donald J. Trump. Deepak Gupta (Gupta Wessler) for Gwynne A. Wilcox.

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