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D.C. Circuit Rejects NLRB’s Pacific Lutheran Test, Reasserts Great Falls Test For Determining NLRA Exemption For Religiously Affiliated Schools
On January 28, 2020, the Court of Appeals for the District of Columbia Circuit held that the National Labor Relations Board (NLRB) lacks jurisdiction over Duquesne University because the school holds itself out as a religious institution and is religiously affiliated. The Court concluded that the NLRB, in reaching its decision that the school must recognize a recognition petition filed by a group of adjunct faculty seeking to unionize, applied the wrong standard for determining jurisdiction. The Court found that the Board improperly asserted authority over the school, which is properly exempt from the National Labor Relations Act (NLRA).
The decision was the result of a 2012 unionization effort by adjunct faculty at the University’s liberal arts college who petitioned the NLRB to recognize the AFL-CIO as the exclusive bargaining representative. At the time of the election, a majority of the faculty voted for the Union. The University requested that the Board vacate the election and dismiss the Union’s petition for recognition.
In its request, the University argued to the Board that the D.C. Circuit’s decision in Great Falls v. NLRB (D.C. Circ. 2002) 278 F.3d 1335 (Great Falls) exempted the school from NLRB jurisdiction. In Great Falls, the Court established a three-part test whereby an employer would qualify for exemption from NLRB jurisdiction if: (1) it holds itself out to students, faculty, and the community as providing a religious educational environment; (2) is organized as a nonprofit corporation; (3) and is owned by or affiliated with a religious organization.
The Board did not apply the D.C. Circuit’s Great Falls test, but rather applied an alternative test, which it developed in Pacific Lutheran University (2014) 361 NLRB 1404 (Pacific Lutheran). The Pacific Lutheran test required that, in order to be exempt from NLRB jurisdiction, the employer must not only hold itself out as a religious educational environment but also must “hold out the petitioned-for faculty members themselves as  performing a specific role in creating or maintaining the college or university’s religious educational environment.” As a result, the Pacific Lutheran test imposed an additional requirement concerning the school’s representations about its faculty and their role in the school’s religious educational environment, which is absent in the Great Falls test.
Applying the Pacific Lutheran test, the Board concluded that the University was not exempt from NLRB jurisdiction, and rejected the University’s request that the Board vacate the election and dismiss the Union’s petition for recognition. The University then appealed the Board’s decision to the D.C. Circuit.
In its analysis, the Court of Appeals first analyzed the Religion Clauses in the First Amendment, which provide certain protections to religious organizations, including schools. The Court then turned to jurisdictional questions concerning the NLRB, how the Board and Courts approach labor issues at religious organizations, and whether it is possible to disentangle labor issues from religious ones at such organizations without impermissibly impinging on rights guaranteed by the Religion Clauses.
The Court next discussed its bright-line test for determining whether a religious organization is exempt from the NLRA in Great Falls. The Court explained that the test “will allow the Board to determine whether it has jurisdiction without delving into matters of religious doctrine or motive, and without coercing an educational institution into altering its religious mission to meet regulatory demands.”
Ultimately, a divided Court concluded on a 3-2 vote that the Great Falls test applied to the present circumstances and that the NLRA, therefore, does not empower the Board to exercise jurisdiction over the University. As a result, the Court vacated the Board’s decision certifying the election and recognizing the AFL-CIO as the exclusive bargaining representative for the adjunct faculty.
Duquesne University of the Holy Spirit v. National Labor Relations Board (D.C. Cir. 2020) 947 F.3d 824.
The Duquesne University decision is quite significant for religious educational institutions. When the NLRB established the Pacific Lutheran test in 2014, it made it easier for the NLRB to assert jurisdiction over religious educational institutions and for their employees to unionize. While the Duquesne University decision is not binding in California, it does provide persuasive reasoning that a California federal court may consider if a similar case is tried here.