The Biden-Harris National Labor Relations Board (NLRB) has adopted a far more assertive posture towards advancing workers rights than their predecessors in the Trump-Pence Administration. The Biden-Harris NLRB has brought labor violation claims against major firms such as SpaceX, Amazon, and Starbucks and rewritten NLRB rules to strengthen the position of labor in industrial relations. These moves have not gone unchallenged by business interests. Just a day after receiving a NLRB complaint, SpaceX filed a lawsuit arguing that the entire NLRB scheme is unconstitutional.
The SpaceX litigation is emblematic of labor relations in the United States, and the American political economy writ large. Since the enactment of the National Labor Relations Act (NLRA) in 1935, well-resourced and highly organized business interests have leveraged distinctive features of the American political economy to gain the upper hand in public policy. Compared to other advanced democracies, the American political economy is structured by several institutional oddities. Most important for this entry are the abnormally cumbersome legislative process and an extremely powerful judiciary that takes an outsized role in economic policy. SpaceX and other firms are therefore turning to a familiar playbook: rely on federal courts to scrutinize Labor Board decisionmaking and leverage veto points in Congress to block pro-labor legislation.
This entry will elaborate upon this playbook – tracing how federal courts have wielded judicial power to gradually reshape labor law in business-friendly ways while conservatives in Congress have successfully blocked pro-labor proposals. I then describe how the Biden-Harris NLRB has mounted a significant challenge to the business-friendly status quo in industrial relations, bolstering the position of private sector workers, who are governed under the NLRA/NLRB structure. I argue that these are important developments for American workers, but given the durable success of business interests in reshaping federal labor law in the courts, disproportionate Republican control over the NLRB, and conservative legislative strategies, it will require sustained political advocacy and electoral success to more fully dislodge this business-friendly regime. The Biden-Harris Administration has effectively exercised the levers of executive power to bolster the position of labor. However, these policies may be undone via the 2024 presidential election and subsequent executive branch turnover and/or face retrenchment in federal courts.
Federal Courts, Veto Points, and the Reshaping of American Labor Law
The NLRA was enacted in 1935 and enshrined workers’ rights to unionize, strike, and engage in other “concerted activities” to advance their general welfare while precluding certain unfair labor practices by employers. The NLRB – an independent, quasi-judicial body of five members – was created to enforce the Act’s provisions. Labor Board members are appointed by the President, with three members being selected from the President’s party and two coming from the opposing party. The President also appoints a General Counsel, independent of the Board, who investigates and prosecutes unfair labor cases. The new NLRA/NLRB structure led to skyrocketing private sector unionization. However, a series of Supreme Court decisions, combined with legislative gridlock, contributed to a pro-business tilt in U.S. labor law and sharp union decline in the late 20th and early 21st centuries.
- Narrowing Protected forms of Worker Advocacy: Ambiguity in key NLRA provisions enabled federal courts to play a central role in the development of U.S. labor law. The Supreme Court, for instance, has limited the rights of workers to go on strike and narrowly interpreted section 7 that guarantees workers the right to engage in “concerted activities” to advance their interests. Shortly after the NLRA’s enactment, the Supreme Court found that the Act did not preclude the hiring of replacement workers during bargaining disputes (NLRB v. Mackay Radio 1938), a decision that was subsequently affirmed and expanded upon. These decisions undermined the leverage provided workers by strikes, especially as technological innovation and the rise of “strike management consultants” facilitated the widespread use of replacement workers. More recently, the Supreme Court narrowed worker advocacy tools by ruling that employment contracts including mandatory arbitration clauses do not illegally curtail worker rights under section 7 of the NLRA (Epic Systems v. Lewis 2018). Sarah Staszak has documented the sharp rise of mandatory arbitration agreements and how these agreements strengthen the position of employers vis a vis their employees compared to class action litigation.
- Truncating NLRB authority: In 1940, the Supreme Court limited NLRB authority to enforce NLRA provisions by confining enforcement power to remedial rather than punitive actions. In other words, the Board could address and “fix” past wrongs but not exact additional concessions from firms. These decisions reduced the incentives of businesses to comply with federal labor law: by weakening the consequences of NLRA violations, the Court invited businesses to risk committing unfair labor practices, knowing the result of violations would be limited to remedial action and perhaps some negative media coverage.
- Limiting subnational policymaking: In 1947, NLRA amendments allowed states to enact “right to work laws” that ban union security agreements in which non-union members are required to pay dues to their company union, who negotiates on their behalf. Subsequently, labor advocates sought to entrench worker protections by advancing preemption doctrines that would block subnational governments form enacting additional pro-business labor policies. The Supreme Court obliged, ruling in 1959 and 1976 that the NLRA blocked almost all state and local labor laws. However, as the NLRA became increasingly ineffective in protecting labor, workers and their political allies pursued subnational action to address the imbalance between labor and capital. In 2008, the Supreme Court rejected such attempts. Most recently, the Court crafted a new, business-friendly exception to their broad preemption doctrine. In Glacier Northwest Inc v. Teamsters (2023), the Court interpreted the NLRA to include a preemption exception for state tort claims regarding property damage incurred during strikes. Tort claims are lawsuits in which a party requests compensation for damage wrongfully incurred due to the actions of another party. At issue in Glacier Northwest (2023), for example, were the efforts of a trucking company to file a tort claim in state court against striking workers for the loss of goods incurred during a work stoppage. As a result of the Supreme Court decision allowing tort claims against striking workers, state courts can now be weaponized against striking workers, while NLRA preemption jurisprudence restricts state legislatures from enacting pro-labor reforms.
- Curtailing NLRB discretion: As federal policies transform due to formal stagnation in the face of changing socioeconomic conditions, groups pursue policy change outside Congress. In the case of the NLRA, subnational policy change was foreclosed by the Court’s preemption doctrine, so favorable NLRB interpretations of the Act became the most promising avenue for pro-labor updates. In several instances, the Supreme Court blocked such efforts: overturning NLRB approval of faculty unions, precluding the awarding of back pay to undocumented workers, and concluding that mandatory arbitration clauses do not illegally curtail labor rights under section 7 of the NLRA.2
- Leveraging Veto Points: Unions and their allies mobilized to reverse these unfavorable legal developments by attempting to amend the NLRA in Congress – often in direct response to business-friendly Court decisions. In the late 1970s, a reform bill was introduced to grant the NLRB punitive authority after the Court had curtailed Board authority in Republic Steel (1940). The bill would have empowered the NLRB to award double back pay to workers subject to unfair labor practices and bar employers committing labor violations from winning federal contracts. A 1994 bill would have reversed Mackay Radio (1938) by limiting the hiring of replacement workers during strikes. In both instances, a minority of Senators, backed by the Chamber of Commerce, were able to obstruct the proposed legislation by invoking a filibuster. Despite union approval soaring since the 2010s, recent proposals to strengthen labor such as the PRO Act are consistently blocked, even when they have majority support in Congress and presidential backing.
The Assertive, Pro-Labor NLRB of the Biden-Harris Administration
Recent political developments (as opposed to legal developments) have largely contradicted the pro-business stance of federal courts. Labor advocacy and upticks in public support are reflected in the Biden-Harris administration’s major initiatives to reward labor for their 2020 electoral support. As noted by other pieces in this collection, the Biden-Harris Administration has taken bold steps to reshape NLRB composition and implement a more labor-friendly administrative agenda.
- Staffing Changes: The NLRB is typically staffed by three members of the President’s party and two members of the other party, giving presidents a direct avenue to shape labor policy. Indeed, the pro-business tilt of modern labor law can be partially explained by Republican presidents’ NLRB appointments. Since taking office, President Biden has appointed three Labor Board members, with two of those still serving. As of April 2024, the Board has four seated members: three Democrats and one Republican. In addition to these regular appointments, President Biden took more aggressive action in firing NLRB General Counsel Peter Robb, a Trump appointee who previously led litigation against striking air traffic control workers on behalf of the Reagan administration. He was replaced by Jennifer Abruzzo, whose previous work includes 20 years in the NLRB and representing the Communication Workers of America. After her 51-50 confirmation by the Senate, Abruzzo immediately advanced worker-friendly legal arguments.
- Implementation and Enforcement: Both the Labor Board and General Counsel’s office have taken important actions to strengthen the position of American workers. Reversing Trump-era policies, the Biden-Harris NLRB has overturned a “gag” rule limiting employee rights in severance agreements, expedited union election processes, brought more contract workers under NLRA definitions of “employee”, and made it easier to hold parent companies responsible for labor violations committed by their franchisees. The Board has also restored a 54-year-old rule allowing workers who get a majority of their members to sign union cards to ratify their union without an NLRB election and acted against major corporations such as Amazon, Tesla, and Starbucks. Many of these policies will bring real relief to American workers, such as extending NLRA protections to more contract workers– a move that is especially important given the growth of contract workers in the 21st century. Yet, the durability of these changes is dependent upon subsequent political and legal developments. The Electoral College skews presidential elections in favor of the Republican Party, whose candidates would certainly appoint Board members reversing these moves. Federal courts remain a formidable obstacle to NLRB action. The dissenting NLRB member in the Board’s decision to adopt a more inclusive standard for employee argued that the decision “isn’t likely to survive judicial review” – sending a clear invitation to business to challenge the Board’s decision in Court.
Institutional Obstacles and Looking Ahead
NLRB actions during the Biden-Harris administration illustrate the Labor Board’s authority to create meaningful policy change for American workers. As the Board has sharply pivoted its stance since the Trump administration, there has been a 60% increase in worker petitions to form unions (see Alex Hertel-Fernandez’s entry in this collection). These developments occur alongside the ongoing efforts of non-unionized but highly organized “alt-labor” groups, such as worker centers, which have targeted subnational employment law (e.g., minimum wage campaigns, fair workweek laws) to advance their interests, demonstrating another dimension of successful worker advocacy (see Dan Galvin's entry in this collection). Unlike labor law, there is a longstanding legal tradition that states and cities can enact employment law reforms.
Pro-worker advances in both federal labor law and subnational employment law are important victories that will require durable political support and electoral success to maintain. The potential election of any Republican as president would almost certainly result in wholesale changes at the Department of Labor, a reconstitution of Labor Board personnel, and the removal of Jennifer Abruzzo from the Labor Board’s General Counsel’s office. Indeed, The Chamber of Commerce – who perhaps exemplifies the highly organized and well-resourced business litigation machine – has already won litigation in a U.S District Court against the Labor Board’s recent “joint-employer” rule that holds parent companies liable for franchisee practices.
A 6-3 conservative supermajority retains control on the U.S. Supreme Court, and it will likely take several decades of well-timed electoral success—or significant reform in the structure of the Court—for the Democratic Party to appoint even a bare majority of Justices. The election of President Trump would further entrench conservative control of the Supreme Court and also push lower federal courts in a pro-business direction. Since the NLRB has adopted a more labor-friendly posture, corporations subject to Labor Board reprisals have looked to the judiciary for relief. The Roberts Court will almost certainly be welcoming to such claims, as evidenced by their recent pro-business rulings in Glacier Northwest (2023) and Epic Systems (2018). In late April, the Supreme Court will hear oral arguments in litigation brought by Starbucks concerning an NLRB order to reinstate illegally fired workers. A ruling in favor of Starbucks could severely limit the Labor Board’s ability to seek court orders mandating the reinstatement of illegally fired workers, further undermining the position of labor and institutional authority of the NLRB. As mentioned above, SpaceX has gone even further in their claims (and have been joined by Amazon and Trader Joe’s), filing a lawsuit the NLRB is unconstitutional. The constitutionality of the NLRA scheme was affirmed by the Supreme Court in 1937 and has not faced any serious constitutional challenges since.
In sum, the Biden-Harris NLRB illustrates the potential of – and constraints upon – short-term electoral victories for American labor. The Biden-Harris Administration has taken a stronger pro-labor stance than many of their recent predecessors and the Labor Board has acted accordingly. However, well-organized and extraordinarily wealthy business advocacy organizations continue to use distinctive features of the American political economy, especially a veto riddled legislative process and powerful judiciary, to block pro-labor developments. During the Biden-Harris Administration, businesses have already won legal victories curtailing important NLRB actions and consistently stymie legislative action in Congress. What’s more, Senate and Presidential elections are constructed in ways that give Republicans disproportionate influence in selecting federal judges and NLRB membership. As such, institutional features of the American political economy tilt the scales in favor of business, making it especially imperative that labor advocates persistently mobilize to overcome these obstacles and more durably control administrative agencies and federal courts.
