New Process Steel, L.P. v. NLRB

New Process Steel, L.P. v. NLRB, 560 U.S. 674 (2010), is a US labor law case of the United States Supreme Court holding that the National Labor Relations Board (NLRB) cannot make decisions without a quorum of three members.
Facts.
The NLRB was created by Executive Order on June 29, 1934 by President Franklin D. Roosevelt to oversee labor related disputes for private companies, and later the United States Postal Service. The following year, 1935, Congress passed the National Labor Relations Act (also known as the Wagner Act or NLRA) giving the NLRB a statutory basis for labor policy. The NLRB is made up of a presidential-appointed General Counsel, who investigates and prosecutes unfair labor practices, and a quasi-judicial body known as the Board, which adjudicates unfair labor practices and representational issues involving labor organizations. At the time of its creation, the Board consisted of three members and required a two-member quorum to make decisions. In 1947, Congress passed the Taft-Hartley Act, which increased the size of the Board from three to five members and required that members of the Board be confirmed by the Senate. It also raised the quorum needed for the Board to function from two to three members. Since 1993 there have been brief periods of time when the Board had only two members, but these have rarely extended beyond a few days and the two-member Board did not issue decisions.
In December 2007, the terms for three of the Board's five members were set to expire. President George W. Bush's nominees were blocked by Senate Democrats. On December 16, 2007, Chairman Robert J. Battista's term expired and member Wilma Liebman took over as Chairwoman for the remaining four-person Board. On December 28, 2007, with the terms of members Peter Kirsanow and Dennis Walsh set to expire on New Year's Eve, the four-member Board delegated all of its powers to the three-person panel of Chairwoman Liebman and members Kirsanow and Peter Schaumber. By doing so, the Board operated under the assumption that the two remaining members, Liebman and Schaumber, were able to make decisions as a majority of the designated three-person Board. 
That same day, the General Counsel issued an unfair labor practice complaint against employer New Process Steel in their dispute with the International Association of Machinists and Aerospace Workers. On May 1, 2008, an administrative law judge issued a decision against New Process Steel. The General Counsel followed with another complaint on May 29, 2008 and filed for summary judgment with the Board. In late September 2008, the Board found New Process Steel to have violated Sections 8(a)(1) and (5) of the NLRA in both cases.
New Process Steel appealed the Board's decisions, arguing in part that the Board lacked the required three-person quorum to make decisions. The Seventh Circuit Court of Appeals denied the appeal and enforced the Board's order on May 1, 2009. New Process Steel then appealed to the Supreme Court, which granted certiorari on November 2, 2009 due to conflicting circuit court decisions and a request from the Department of Justice to review the issue given the stakes. The First, Second, Fourth, Seventh and Tenth Circuit Courts of Appeals had ruled in favor of the government; however, the United States Court of Appeals for the D.C. Circuit ruled against it.
Between January 2008 and June 2010, the two-member Board of Liebman and Schaumber issued nearly 600 decisions. During that time, they informally agreed to hear only noncontroversial cases until a third member was confirmed.
Judgment.
The question before the Court was; Does the NLRB have legally recognized authority to decide cases with only two sitting members, where 29 U.S.C. § 153(b) provides that "three members of the Board shall, at all times, constitute a quorum of the Board"?
The Court ruled for the plaintiffs. The NLRB lacked the authority to issue official rulings with only two members, regardless if a majority of the Board had delegated its power to a smaller group. The Court determined that as the statute was written Congress only allowed the NLRB to delegate power to three of the five members. If Congress had wanted to allow two members the full powers of the Board, then it would have written it into the statute. It rejected the government’s argument for the sake of efficiency.