Amazon Finds Seventh Circuit Friend in Appeal of NLRB Ruling (1)

Amazon.com Inc. got the support of a federal appeals court judge in its challenge to an NLRB ruling that the company’s rule on employee access to its facilities violated federal labor law by containing a clause granting it discretion to selectively enforce the restriction.

Amazon has the right to control access to its properties, and to change its access policy and allow exceptions, Judge Frank Easterbrook, a Reagan appointee to the US Court of Appeals for the Seventh Circuit, said during oral argument Tuesday.

Easterbrook, who dominated the argument session as the two Biden-appointed judges on the panel mostly remained silent, invoked the US Supreme Court’s landmark 2024 ruling that ended judicial deference to agencies’ views of ambiguous law while he sharply questioned an attorney for the National Labor Relations Board.

The appeals court case stems from a pair of NLRB related decisions against Amazon that turned on the company appending its off-duty-access ban with a statement saying it has the discretion to decide when and why off-duty employees can access its facilities. The offending clause was in place for about a week during the summer of 2022.

The NLRB held in March 2024 that the policy violated the law. About sixth months later, the board found that Amazon violated a settlement agreement because of the illegal off-duty-access policy.

Amazon reserving the right to depart from its policy runs afoul of the legal test for off-duty access rules from the NLRB’s 1976 decison in Tri-County Medical Center, which prohibits the application of access restrictions that treat union organizers differently, the board said.

But during oral argument, Easterbrook told NLRB lawyer Barbara Sheehy that he’s “not interested in board law” when it comes to deciding whether Amazon’s policy violated the National Labor Relations Act.

“We have just been told in Loper Bright that we will determine what the law is,” Easterbrook said. “If there’s play in the joints, if the law grants some discretion to the board, fine. But I don’t see an argument that the board has discretion here.”

‘It’s a Problem’

Sheehy said she’s limited to making arguments based on what the NLRB has previously pronounced. The board addressed this situation in Tri-County, which says making exceptions to access rules that disadvantage union organizing violates the NLRA.

Amazon’s announcement that it has the right to make exceptions to its access policy chills workers’ exercise of speech on the property, she said.

“So the premise is that workers are too stupid to know Amazon has that right whether it announces it or not?” Easterbrook asked.

Sheehy disagreed, saying that workers reading the access policy would understand that Amazon is going to control when they’re allowed on and off the property.

Easterbrook said his problem is that “the board has treated every sentence in Tri-County as if it was identical to” the NLRA section governing unfair labor practices, which is the wrong approach.

“The board can interpret the statute. We can interpret the statute,” the judge said. “But all the board seems to have done is interpret its own decision and forgot about the statute. And it’s a problem.”

Amazon didn’t argue before the board that Tri-County was the wrong interpretation of the statute, so it didn’t preserve that argument for consideration at the Seventh Circuit, Sheehy said.

“As soon as Loper Bright issued, a light bulb went off and they said, ‘Wait a minute, we can go after the board for its very interpretation of the statute—even though we never did it before, we just need to convince the court that we’re in statutory interpretation grounds,’” she said.

The NLRB enjoys a deference from the courts on its interpretation of the NLRB that predates the Chevron doctrine—which was overturned in Loper Bright Enterprises v. Raimondo—and thus transcends Loper Bright, Sheehy said. If the court wants to explore the deference issue further, the board would request the chance to submit additional briefing, she said.

Amazon’s lawyer, Brian Stolzenbach of Seyfarth Shaw LLP, said the company argued at the NLRB level that the interpretation of Tri-County that the board applied goes beyond what the NLRA actually states.

“But counsel, did you preserve an argument that Tri-County was wrong?” Judge Joshua Kolar asked.

“Again, your honor, we’re not saying Tri-County itself was wrong,” Stolzenbach replied.

Judge Nancy Maldonado didn’t speak during oral argument.

The case is Amazon.com Services LLC v. NLRB, 7th Cir., No. 24-1548, oral argument held 4/15/25.