Employment Law Report
The Supreme Court Heightens Standard for Injunctive Relief Under NLRA Section 10(j)
By: Mitzi Wyrick
On June 13, 2024, the Supreme Court of the United States held in Starbucks Corp. v. McKinney that the National Labor Relations Board (NLRB) must meet the traditional four-part test to obtain preliminary injunctions under §10(j) of the National Labor Relations Act (NRLA).
Case Background
In 2022, six Starbucks employees at a Memphis, Tennessee location planned to unionize and formed an organizing committee. Several Starbucks employees invited a local news crew to the Memphis store after hours, and the news crew interviewed the Starbucks employees about their efforts. The following day, store management launched an investigation into the event and ultimately fired multiple employees, including members of the organizing committee, for their involvement in the event and for violating company policy.
The union coordinating with the Starbucks employees filed charges with the NLRB and alleged Starbucks discriminated against its employees who supported the union and interfered with its employees’ right to unionize. The NLRB investigated and ultimately issued a complaint against Starbucks. Pursuant to the NLRA, the NLRB filed a §10(j) petition seeking a preliminary injunction to require, among other things, the reinstatement of the Starbucks employees. The NLRA authorizes the NLRB to seek a preliminary injunction while it conducts an administrative proceeding because a proceeding often takes years. A United States district court may grant a preliminary injunction “as it deems just and proper.”
The NLRB filed the §10(j) petition in the United States District Court for the Western District of Tennessee. The Court applied a two-part test (reasonable-cause standard), which asks whether “there is reasonable cause to believe that unfair labor practices have occurred,” and whether injunctive relief is “just and proper.” The Sixth Circuit affirmed. Starbucks appealed to the Supreme Court. The Court granted certiorari to decide whether courts should apply the two-part test or the more standard four-part test.
Circuit Split: Two-Part Test vs. Four-Part Test
Circuit courts were split on the standard to apply when evaluating petitions for §10(j) injunctions. Some courts applied the two-part, reasonable-cause standard, like the Sixth Circuit. Other courts applied the four-part test articulated in Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008). The four-part test requires a plaintiff to show “he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.”
Decision
The Supreme Court ruled in favor of the four-part test. The Court explained that when Congress grants courts the authority to grant equitable relief, courts must not assume that Congress, absent a clear command, intends to “depart from established principles.” There is a presumption that courts “will exercise that authority in a manner consistent with traditional principles of equity.” The Court concluded the four-part test in Winter demonstrated “relevant equitable principles,” finding that nothing in §10(j) “displaces the presumption that those traditional principles govern.” The court also reasoned that its precedent “counseled against reading §10(j) to supplant the traditional equitable principles governing injunctions,” and §10(j)’s text “bears no resemblance to the language that Congress has employed when it has altered the normal equitable rules.”
The Court declared the two-part, reasonable-cause standard too lenient because it lowered the threshold for securing a preliminary injunction. The Court stated the NLRB could hardly lose under the two-part test, concluding the test was a “watered-down approach to equity.” The NLRB and partial dissent reasoned courts should apply a deferential standard, but the court disagreed and stated that “deference to what is ‘nothing more than an agency’s convenient litigating position’ is ‘entirely inappropriate.’”
The Impact
The ruling will make it harder for the NLRB to obtain preliminary injunctions while conducting its administrative proceedings. NLRB General Counsel Jennifer Abruzzo expressed her stance on the Supreme Court’s decision, stating the decision did not change her approach to aggressively seeking §10(j) injunctive relief when necessary. In a July 16th memorandum, Abruzzo stated: “[W]hile the Supreme Court’s decision in Starbucks Corp. provides a uniform standard . . . adoption of this standard will not have a significant impact on the Agency’s Section 10(j) program as the Agency has ample experience litigating Section 10(j) injunctions under that standard.”
For employers located in the areas where the NLRB had applied the more lenient standard (including the Sixth Circuit), the stricter standard is good news. For workers, the stricter standard will make it harder to return to their jobs during NLRB administrative proceedings. Wyatt attorneys are here to help navigate the changes brought by this ruling.
