Elon Musk’s Crusade Against Labor Board Could Upend America’s Administrative State

In billionaire Elon Musk’s crusade against the National Labor Relations Board, attorneys for SpaceX are pushing to halt proceedings at the board in anticipation of a friendly court ruling this spring, a move that could grind the agency to a halt even before a court ruling.In January, SpaceX filed a suit against the NLRB, arguing that the agency’s administrative courts are unconstitutional and should not be allowed to take enforcement actions against Mr. Musk’s company.The suit arose after the board issued a complaint alleging that SpaceX illegally fired eight engineers, four of whom have gone on to join the NLRB’s lawsuit. SpaceX allegedly fired those engineers for calling Mr. Musk, whose online antics often draw attention and sharp criticism, a “distraction and embarrassment” in a letter to company executives.While the suit was set to begin in earnest in March — a recent change of venue may delay that — SpaceX has filed to have all proceedings at the NLRB halted until its legal suit is resolved, leaning on familiar conservative arguments against administrative courts that echo a case currently pending before the Supreme Court, SEC v. Jarkesy.“Without preliminary relief from this Court, SpaceX will be required to undergo an unconstitutional proceeding before an insufficiently accountable agency official, without the jury it is entitled to, and without the basic due process of an unbiased decision maker consistent with the separation of powers,” attorneys for SpaceX wrote in a brief in support of halting proceedings at the NLRB.Although the larger case — in which SpaceX argues that the NLRB itself is unconstitutional — would have major consequences for the NLRB and other administrative agencies, even the court granting its request to halt proceedings at the board while the case is ongoing could have major implications.For one, granting SpaceX’s request would mean that the court believes the case is likely to succeed, a requirement for this sort of action to be taken by a court.Secondly, it would upend the order in which labor disputes are settled and could open the door to any company filing suit in order to circumnavigate the NLRB as soon as a complaint is filed against them, according to a partner at Julien, Mirer, Singla and Goldstein PLLC, Seth Goldstein.“It would be earth shattering because what it would be saying is that this 89-year-old rule is unconstitutional,” Mr. Goldstein tells the Sun. “The issue would be that effectively a preliminary injunction for SpaceX would become a national preliminary injunction.”In this way, the court granting SpaceX’s request would represent a major victory for opponents of the NLRB itself. It would also set the stage for conflicting court rulings on the question of halting NLRB proceedings, which could help fastrack the issue to the Supreme Court.“You would have lawyers running around filing for preliminary injunctions in their areas arguing that the board is unconstitutional,” Mr. Goldstein says. “The machinery would be interrupted.”A former NLRB chairman and the author of “For Labor To Build Upon,” William Gould IV, tells the Sun that the court granting SpaceX relief at this stage “would create havoc” because employers would immediately file for a court to stop any NLRB proceedings.“It would create a kind of lawless no man’s land where the basic purposes of the act, which are designed to produce industrial peace, would be undermined,” Mr. Gould tells the Sun. “If that goes on the act becomes completely meaningless.”In Mr. Goldstein’s opinion, the fact that SpaceX filed the suit in the Southern District of Texas and not in California, where the issue actually took place, is a sign that the company is hoping to appeal to the Fifth Circuit and “rocket docket it up to the Supreme Court.”The NLRB has filed successfully to move the suit to California, with Judge Olvera writing “This action concerns a California administrative proceeding regarding the actions of a California company and its California employees in California.” Already since SpaceX filed its suit arguing that the NLRB is unconstitutional other companies have been emboldened to make similar arguments. In proceedings before the NLRB earlier this month, attorneys from the grocery chain Trader Joe’s argued that the structure of the NLRB is unconstitutional, echoing language from the SpaceX suit. Amazon has also recently adopted the argument that the board is unconstitutional.“The structure and organization of the National Labor Relations Board and the agency’s administrative law judges is unconstitutional,” attorney Christopher Murphy said, according to a transcript obtained by Bloomberg.

Elon Musk’s Crusade Against Labor Board Could Upend America’s Administrative State

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