Key Points

• Court injunction: A federal court preliminarily enjoined New York’s new law expanding PERB jurisdiction over NLRA-covered private-sector labor disputes, holding that the law is likely preempted by federal law.
• State law must yield: The court rejected New York’s argument for a “unique circumstances” exception based on alleged NLRB dysfunction and found irreparable harm in the risk of parallel, inconsistent state and federal proceedings.
• Other challenges: Related litigation is ongoing, including the NLRB’s own challenge to the New York law and a similar California law, testing the limits of state efforts to enforce the NLRA.

A federal district court preliminarily enjoined New York from enforcing a law that would have extended state labor regulations to employees already covered by the National Labor Relations Act (NLRA). The court held that the NLRA preempts New York’s law, emphasizing that the National Labor Relations Board (NLRB) retains jurisdiction over conduct arguably protected or prohibited by the NLRA that New York now seeks to regulate.

What Happened

On Nov. 26, the U.S. District Court for the Eastern District of New York granted an employer’s request for a preliminary injunction blocking enforcement of New York’s law, enacted this summer, that would have allowed the New York Public Employment Relations Board (PERB) to adjudicate matters involving private sector employers ordinarily subject to the NLRA. When signing the bill into law, Gov. Kathy Hochul noted that the Trump administration “has failed to prioritize a strong [NLRB].”

The court found the employer likely to succeed on its claim that the state law is preempted under the Supreme Court’s Garmon doctrine, which bars states from regulating activity that is at least “arguably” protected by, or prohibited by, the NLRA.[1]

The court rejected New York’s invitation to craft a “unique circumstances” exception based on perceived NLRB inaction — including assertions about the NLRB’s lack of quorum and uncertainty surrounding removal protections for NLRB Board Members. The court explained that Garmon recognizes no such exception, that Congress anticipated occasional quorum lapses, and that the Supreme Court has not yet ruled on the legality of the removal protections.

The court held that injunctive relief was necessary to prevent the irreparable harm of inconsistent rulings in parallel NLRB and PERB proceedings, concluding that the equities and public interest favor an injunction.

Similar Lawsuits Pending

The NLRB has filed its own lawsuit in the U.S. District Court for the Northern District of New York challenging New York’s law, underscoring the agency’s view that states may not displace the Board’s authority. In September, that court issued an administrative stay requiring PERB to pause any proceedings that could fall within the NLRB’s jurisdiction until the court rules on the NLRB’s motion for a preliminary injunction.

The NLRB has challenged California in another, similar “NLRA-enforcement” experiment, the outcome of which is still pending.

We have previously written about the preemption risk that these state laws carry — which are meant to let states enforce the NLRA during claimed federal regulatory lapses [See previous alerts New York Governor Signs Bill Authorizing State to Enforce Federal Labor Law; State Labor Bills Are ‘Very Likely Unconstitutional,’ Top NLRB Lawyer Says; and States Pondering ‘Trigger’ Legislation to Enforce the National Labor Relations Act].

Next Steps

The court’s decision reaffirms that the NLRB’s jurisdiction over private sector union disputes cannot be displaced by state actors, even temporarily or in perceived periods of diminished federal agency capacity.

For New York employers, the ruling halts, for now, PERB’s newly asserted oversight over NLRA-covered workplaces and avoids the compliance morass of competing state and federal standards for unfair labor practices and collective bargaining rights.

Although New York’s law is currently enjoined, the court’s ruling is preliminary, with a final ruling expected soon, and the state is likely to appeal any adverse rulings.

Employers in New York who are served with a PERB charge related to NLRA-covered activity should promptly contact experienced labor counsel.

[1] See San Diego Building Trades Council v. Garmon, 359 U.S. 236 (1959).

For more information on this and related topics, contact authors Carolyn D. Richmond at crichmond@foxrothschild.com or 212.878.7983, Robert C. Nagle at rnagle@foxrothschild.com or 215.299.2064, Mark G. Eskenazi at meskenazi@foxrothschild.com or 202.461.3109, Joel R. White at jwhite@foxrothschild.com or 336.378.5244, or any other member of our Labor & Employment Department.

This information is intended to inform firm clients and friends about legal developments, including the decisions of courts and administrative bodies. Nothing in this alert should be construed as legal advice or a legal opinion. Readers should not act upon the information contained in this alert without seeking the advice of legal counsel. Views expressed are those of the authors and not necessarily this law firm or its clients.