Key Takeaways:
- In 2023, the NLRB implemented the Cemex framework, which allowed the NLRB to impose remedial bargaining orders even where a fair rerun election might be possible.
- In March 2026, a three-judge panel at the Sixth Circuit Court of Appeals rejected the Cemex framework as an improper exercise of the NLRB’s adjudicatory authority.
- The NLRB has asked for a rehearing of the Sixth Circuit’s decision before all judges on the Sixth Circuit.
- The NLRB’s request signals that it will continue to enforce the Cemex framework until definitively shut down.
In March 2026, the Sixth Circuit Court of Appeals issued a decision that rejected the National Labor Relations Board’s (NLRB) Cemex framework for issuing remedial bargaining orders. The NLRB adopted the Cemex framework in a 2023 decision that significantly expanded the Board’s authority to issue bargaining orders. The Sixth Circuit held, in a 2-1 decision, that the Board’s imposition of the Cemex framework exceeded the Board’s adjudicatory authority.
On May 11, 2026, the Board requested a rehearing before all active judges on the Sixth Circuit. The Board’s request demonstrates that it is not deterred by the Sixth Circuit’s Brown-Forman decision and that it will continue to attempt to enforce the Cemex framework until the courts definitively shut it down.
The Dispute in Brown-Forman
Brown-Forman arose out of a union organizing campaign at the Kentucky facilities of distiller Brown-Forman. Brown-Forman gave employees raises and free bourbon shortly before the election. The union lost the election and claimed the company engaged in unfair labor practices. The Board agreed and imposed a bargaining order requiring Brown-Forman to recognize and bargain with the union.
In imposing the bargaining order, the Board did not rely on the Supreme Court’s decision in NLRB v. Gissel Packing Co., 395 U.S. 575 (1969). The Gissel decision, which stood as the relevant standard for bargaining orders for more than 50 years, allowed the Board to issue bargaining orders only if a fair rerun election was unlikely.
Instead, the Board relied on the framework it announced in Cemex Constr. Materials Pac., LLC, 372 NLRB 130. The Cemex framework significantly expanded the Board’s authority to issue bargaining orders. In adopting this framework, the Board noted that it would “no longer look” to Gissel and would issue remedial bargaining orders even where a fair rerun election might be possible.
The Sixth Circuit’s Decision
On appeal, a three-judge panel at the Sixth Circuit agreed that Brown Forman unlawfully interfered with the election. However, it rejected the Board’s implementation of a bargaining order.
The Court held that, when adopting Cemex, the Board engaged in improper rulemaking through adjudication. Because the Board based its decision to impose a bargaining order against Brown-Forman exclusively on Cemex, and because the Sixth Circuit held that Cemex “was an improper exercise of the Board’s adjudicatory authority,” the Sixth Circuit held it “cannot enforce” the bargaining order against Brown-Forman. The Sixth Circuit remanded the case to the Board for further proceedings.
The NLRB’s Request for Rehearing
The Board has refused to accept the Sixth Circuit’s rejection of Cemex. Shortly after the Brown-Forman decision, the Board filed a brief in the Ninth Circuit Court of Appeals (where the original Cemex case was pending) calling the Sixth Circuit’s analysis “flawed.”
On May 11, 2026, the Board asked the Sixth Circuit to reconsider the three-judge panel’s decision at an en banc hearing, which is a hearing before all active judges at the Sixth Circuit. This additional form of review is only available in exceptional circumstances, such as when a party claims the panel’s decision conflicts with Supreme Court precedent and/or involves questions of exceptional importance.
The Board argues that it is entitled to en banc review because the Sixth Circuit’s decision conflicts with Supreme Court precedent. The Board argues that it is allowed to act through adjudication (i.e., deciding cases) and through formal rulemaking, and that Supreme Court precedent vests the Board with “broad discretionary power” to choose which method is appropriate. The Board argues that the Sixth Circuit’s decision improperly limits the Board’s adjudicative authority, which is “the primary procedure it uses to announce policies under the National Labor Relations Act.” The Board contends that this alleged restraint on its adjudicative authority is an issue of “exceptional importance” that warrants review by the full Sixth Circuit.
Takeaways
The Board’s petition for en banc review is important for two reasons. First, it indicates that the Board is not deterred by the Sixth Circuit’s decision and that it will continue to enforce the Cemex framework – that is, to issue bargaining orders even where there is no showing that a fair rerun election is unlikely – until definitively shut down by the courts. Second, it indicates that the Board will continue to create and implement labor policy through adjudication and will push back on any restraints to its authority to do so.