Amazon and SpaceX Challenge NLRB’s Constitutional Authority in Federal Appeals Court

Attorneys for Amazon and Elon Musk’s SpaceX appeared before a federal appeals court in New Orleans on Monday to argue that the structure of the National Labor Relations Board (NLRB) is unconstitutional. This development advances an ongoing legal battle concerning the rights of workers and union organization activities.

The cases were brought before a panel of three judges in the U.S. Court of Appeals for the 5th Circuit, where judges appointed by Republican presidents form a majority. The legal proceeding comes after the NLRB filed complaints against the companies, alleging unfair labor practices.

Mike E. Kenneally, representing SpaceX, contended that the government’s reliance on procedural issues suggests weaknesses in its legal standing. Judge James E. Graves Jr., appointed by former President Obama, noted this argument seemed akin to dismissing procedural significance if substantive victory is anticipated.

SpaceX initiated its lawsuit in January after the NLRB accused it of unfairly dismissing employees who criticized Musk and giving the impression that workers were under surveillance. SpaceX argues that the NLRB’s process violates its right to a jury trial.

Amazon’s lawsuit relates to allegations of NLRB’s improper actions in a 2022 vote at a New York City warehouse. Amazon claimed the agency interfered by filing a lawsuit to reinstate a dismissed organizer close to the election period, although the Amazon Labor Union succeeded in its efforts to represent the workers. Despite these claims, Amazon has refused to negotiate.

Amazon alleges that the NLRB board acted unconstitutionally by reviewing complaints they themselves authorized, a structure it claims shields board members from presidential dismissal.

NLRB General Counsel Jennifer Abruzzo stated prior to the hearing that such challenges are not new for large companies seeking to evade accountability for alleged labor law violations.

Musk, recently influential due to a significant financial contribution to President-elect Donald Trump’s campaign, is anticipated to have a pivotal role in efforts to reduce federal regulations under the new administration.