NLRB Remedies During Pending Litigation: Starbucks Corp. v. McKinney

Background

In the case of Starbucks Corp. v. McKinney (2024), several Starbucks employees in Memphis, Tennessee, announced plans to unionize and invited a local news crew to their store after hours to promote their efforts. Starbucks subsequently fired multiple employees involved in the media event for violating company policy. The National Labor Relations Board (NLRB) filed an administrative complaint against Starbucks, alleging unfair labor practices.

Initial Court Decisions

The NLRB's regional Director filed a petition under §10(j) of the National Labor Relations Act, seeking a preliminary injunction to reinstate the fired employees during the administrative proceedings. The District Court granted the injunction, using a two-part test to determine:

1. Whether there is reasonable cause to believe that unfair labor practices have occurred.
2. Whether injunctive relief is just and proper.

The Sixth Circuit affirmed this decision.

Supreme Court Ruling

The Supreme Court of the United States vacated the Sixth Circuit's decision. The Court held that when considering the NLRB’s request for a preliminary injunction under §10(j), district courts must apply the traditional four-factor test from Winter v. Natural Resources Defense Council, Inc. This test requires a plaintiff to clearly show:

1. Likelihood of success on the merits.
2. Likelihood of suffering irreparable harm without preliminary relief.
3. Balance of equities tipping in their favor.
4. That an injunction is in the public interest.

The Supreme Court found that nothing in §10(j) overrides these traditional principles. The Court rejected the NLRB's argument that the statutory context should allow for a less stringent application of these criteria. The Court concluded that the reasonable-cause standard lowers the bar for securing a preliminary injunction by requiring courts to defer to the NLRB’s preliminary view of the facts, law, and equities. The case was remanded for further proceedings consistent with this opinion.

Implications for HR Professionals

This ruling emphasizes the importance of understanding the evidentiary standards required for preliminary injunctions in labor disputes. HR professionals should be aware that the traditional four-factor test will be applied in such cases, ensuring a rigorous evaluation of the merits, potential harm, balance of equities, and public interest before granting injunctive relief. This decision underscores the need for careful documentation and adherence to legal standards in handling labor relations and potential disputes.

For questions please contact a member of our Labor and Employment team listed below.