Supreme Court Holds That Traditional, Four-Part Preliminary Injunction Standard Applies to National Labor Relations Act Injunctions

On June 13, 2024, The Supreme Court ruled in Starbucks v. McKinney that the National Labor Relations Board (“Board”) must meet the same four-part test that other litigants must satisfy in order to obtain a preliminary injunction. This holding resolves a split amongst the circuit courts, some of which have applied a “less exacting” two-factor test to preliminary injunctions under Section 10(j) of the National Labor Relations Act (“NLRA”).

The Court’s Holding

In 2022, employees at a Tennessee Starbucks announced plans to unionize. Several employees invited a local television station to visit the store after hours to promote their unionizing efforts. When store management learned about the media event, they investigated and fired the employees involved for violating company policy. The union filed charges with the Board, and the Regional Director issued a complaint against Starbucks alleging that it had engaged in unfair labor practices. The Regional Director then filed a petition, under Section 10(j) of the NLRA, seeking a preliminary injunction to reinstate the employees, in the United States District Court for the Western District of Tennessee. Section 10(j) authorizes a Regional Director to seek temporary injunctions against employers and unions in federal district courts to stop unfair labor practices while the merits of the case is litigated before administrative law judges and the Board.

Applying Sixth Circuit precedent, the District Court applied a two-part test in granting the injunction, analyzing (1) whether “there is reasonable cause to believe that the unfair labor practices have occurred,” and (2) whether injunctive relief is “just and proper.” Starbucks appealed, and the U.S. Court of Appeals for the Sixth Circuit upheld the District Court’s holding. Starbucks then appealed to the Supreme Court.

In an 8-1 opinion, the Supreme Court reversed the Sixth Circuit, holding that district courts must apply the traditional preliminary injunction standard when considering a request for an injunction under Section 10(j).  This standard, articulated in Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008), is applicable to all other litigants seeking preliminary injunctions, and requires that a party seeking a preliminary injunction must establish: (1) it is likely to succeed on the merits, (2) it is likely to suffer irreparable harm in the absence of preliminary relief, (3) the balance of equities tips in its favor, and (4) an injunction is in the public interest. This is a high burden, as courts recognize that a preliminary injunction is an extraordinary equitable remedy that is never awarded as of right. The Supreme Court found that “nothing in 10(j)’s text overcomes the presumption that the four traditional criteria govern a preliminary-injunction request by the Board.” While Section 10(j) authorizes a district court “to grant to the Board such temporary relief . . . as it deems just and proper,” the Supreme Court stated that, “we do not understand the statutory directive to grant relief when the district court ‘deems’ it ‘just and proper’ to jettison the normal equitable rules.” In its majority opinion, the Supreme Court interpreted the word “just” to mean “fair” and “righteous,” and the word “proper” to mean “appropriate,” “suitable,” or “correct.” Thus, the Supreme Court found, Section 10(j) simply invites courts to grant equitable relief where they deem it “just and proper,” and in exercising this discretion, must “be guided by sound equitable principles.”

Justice Jackson’s Dissent

In her opinion concurring in judgment and dissenting in part, Justice Jackson argued that Congress granted the Board significant deference in enforcing the NLRA; thus, while she agreed the Winter standard is appropriate, she argued that the “likelihood of success on the merits” prong of the four-factor test should be “far less searching than normal.” The majority overlooks, she explains, the “strikingly deliberate” process in place for filing a 10(j) injunction, whereby the Regional Director first seeks approval to file an injunction from the General Counsel, then, if the General Counsel determines that an injunction should be sought, she must present a recommendation to the Board. It is only after the Board approves the filing of a request for a Section 10(j) injunction in this fashion that the General Counsel or relevant Regional Director files that request in federal district court.

As Justice Jackson further explained, “the NLRA makes the Board, not district courts, the primary adjudicator of labor disputes and the central expositor of labor policy,” and thus it is not for the district court to make a predictive judgment about how it will rule on the merits; rather, it is predicting the future decision of the Board.

Looking Forward

The Sixth Circuit was one of several circuits applying the two-factor test; other circuits used the traditional four-factor test, and others took a hybrid approach that used pieces of both standards. The Starbucks holding resolves the circuit split.

On its face, this holding makes it more difficult for a Regional Director to obtain preliminary injunctions—a seemingly significant victory for employers. Yet the practical effect of the Court’s decision is unclear. The current General Counsel is unlikely to be dissuaded from concluding that an injunction should be sought against employers in test cases addressing the General Counsel’s published priorities.  The General Counsel can be expected to continue to recommend that the Board authorize seeking Section 10(j) relief in such cases, arguing that injunctive relief is still warranted under the four-part test required by the Supreme Court.  Given the current composition of the Board, one can expect Board approval of most such requests. Because 10(j) injunctions are seldom filed —the Board authorized the filing of only 14 injunctions in 2023, compared to 23 in 2022 – it remains to be seen whether the Board will approve requests for 10(j) injunctions in cases in which the General Counsel is seeking a more expansive reading of critical NLRA provisions. 

The Court’s discussion of the extent to which deference should be given to decisions by the Board to seek 10(j) injunctions may be an indication of how the Court will resolve the issues concerning Chevron deference in other cases pending before the Court.  Because of these uncertainties, and the adverse consequences associated with the issuance of a 10(j) injunction, employers should continue to consult with counsel to carefully evaluate any NLRA unfair labor practice charge filed against them.