Readers of this blog are probably familiar with how the appellate court system works. A party appeals a judge’s factual ruling to an appellate court, which then reviews the lower court’s decision. Appeals from federal trial courts and federal regulatory boards are usually heard by that circuit’s court of appeal (i.e. the United States Court of Appeals for the Fourth Circuit). Appeals from the federal appellate courts’ three judge panels usually act as controlling law unless they are modified by the Supreme Court or the full (en banc) appellate court.
Apparently, that basic precept of jurisprudence was lost on the National Labor Relations Board. In FedEx Home Delivery v. National Labor Relations Board, No. 14-1196, decided March 3, 2017, the Circuit Court of Appeals for the D.C. Circuit held that single-route FedEx drivers are independent contractors and, thus, outside the purview of the National Labor Relations Act. What is unique about the case is that the same Court had previously ruled in the exact same way with the exact same parties. In the earlier case, the Court looked to common law agency principles to determine that the FedEx drivers were independent contractors, and noted that the agency test had slightly shifted over time. In the current case, the Board disagreed with the Court’s prior interpretation of the agency test and determined, in spite of the prior ruling, that the drivers were employees. The Court had none of it: “It is clear as clear can be that ‘the same issue presented in a later case in the same court should lead to the same result.’ [citations omitted] Doubly so when the parties are the same.” Since the Board chose not to appeal the prior ruling, it cannot later ask a different panel to rule differently on the same set of facts.
While some may claim “No harm, no foul,” FedEx most likely incurred significant attorneys’ fees, time away from its business and uncertainty concerning its drivers’ right to unionize due to the Board’s ruling. The next business faced with such a tactic may not have the resources FedEx does.