This is the second of two columns discussing U.S. Supreme Court decisions from the 2016-17 term impacting employers. This month we review decisions regarding whether the former acting general counsel of the National Labor Relations Board (NLRB) properly served in that role after his nomination to serve as the NLRB's general counsel on a permanent basis; whether pension plans maintained by certain church-affiliated employers, but not established by a church, qualify for the church plan exemption under the Employee Retirement Income Security Act (ERISA); and whether qui tam whistleblower suits brought under the False Claims Act (FCA) are subject to mandatory dismissal when the FCA's requirement to keep such complaints under seal is violated. These cases have far-reaching implications.

Acting Officials

In N.L.R.B. v. SW General, 137 S. Ct. 929 (2017), the Supreme Court ruled 6-2 that the NLRB's prior acting general counsel, Lafe Solomon, improperly served in that role from January 2011 through October 2013 while awaiting Senate confirmation to serve as the NLRB's general counsel on a permanent basis. The court concluded, based on the Federal Vacancies Reform Act (FVRA), that any person nominated to serve in an acting office could not also serve as the permanent nominee. However, it left open the possibility that not all of Solomon's actions as acting general counsel are void.

The FVRA permits three categories of government officials to perform acting service in a vacant office that requires Presidential appointment and Senate confirmation (a PAS office): the first assistant to that office, a person already serving in another PAS office, or a senior employee in the relevant agency. In June 2010, when the NLRB general counsel office became vacant, President Barack Obama directed Solomon, who spent the previous 10 years as director of the NLRB's Office of Representation Appeals, to serve as acting general counsel. In January 2011, President Obama nominated Solomon to fill the general counsel position on a permanent basis. However, the Senate never took action on the nomination. President Obama ultimately withdrew Solomon's nomination and a new nominee, Richard F. Griffin Jr., was confirmed by the Senate in October 2013. Solomon continued to serve as acting general counsel until that time.

In January 2013, an NLRB Regional Director, exercising authority on Solomon's behalf, issued an unfair labor practice complaint against an ambulance service company. The NLRB affirmed the Administrative Law Judge's decision that the company committed an unfair labor practice by failing to pay certain bonuses to long-term employees. The company appealed to the D.C. Circuit, arguing the unfair labor practice complaint was invalid under FVRA subsection (b)(1), which prohibits a person who the president nominates to permanently fill a vacant PAS office from temporarily carrying out the duties of that office as an acting officer. The NLRB countered that FVRA subsection (b)(1) applies only to an individual who previously served as first assistant to the applicable office, not to a senior employee in the agency like Solomon. The D.C. Circuit rejected the NLRB's argument and held Solomon became ineligible to perform the duties of general counsel in an acting capacity once the president nominated him to fill that post.