Appeals Court Declares NLRB Structure Unconstitutional, Favoring SpaceX

On Tuesday, a federal appeals court ruled in favor of SpaceX, preventing the National Labor Relations Board (NLRB) from pursuing claims of unfair labor practices against the company. This verdict from the Fifth Circuit Court of Appeals brings up questions regarding the constitutionality of the NLRB’s framework and could have far-reaching consequences.

The ruling halts unfair labor practice proceedings involving SpaceX, alongside two other firms, Energy Transfer and Findhelp, as they contest the constitutionality of the NLRB’s framework. Although the court found this tactic to be unlawful, the matter remains contentious, and the NLRB is anticipated to contest this ruling.

The three-judge panel concluded that being subjected to a potentially unconstitutional administrative process, as claimed by SpaceX, represents irreparable harm, hence extending the stay. The NLRB had charged SpaceX with unfair labor practices in light of the termination of employees who signed an open letter criticizing CEO Elon Musk and the company’s culture of sexism.

At the core of the issue is whether the NLRB’s administrative law judges carry unlawful protections that avert their removal by the president. The judges indicated that if this is indeed the case, it violates constitutional provisions regarding the separation of powers.

This panel comprised two judges appointed by President Donald Trump and a third appointed by George H.W. Bush.

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