A federal appeals court handed SpaceX a significant win on Tuesday, ruling that the National Labor Relations Board (NLRB) cannot move forward with prosecuting unfair labor practices against the company.
The U.S. Court of Appeals for the Fifth Circuit suggested that the NLRB’s structure is likely unconstitutional, a decision that could have far-reaching consequences for labor law enforcement.
The ruling halts NLRB cases against SpaceX, Energy Transfer, and Find Help while the companies pursue their claim that the board’s administrative structure violates the U.S. Constitution. Although the court’s decision declared the NLRB’s structure unlawful, the issue is far from settled, and the agency is expected to challenge it.
The three-judge panel determined that being subjected to a potentially unconstitutional administrative proceeding represents irreparable harm, justifying the pause. The NLRB had filed the case after SpaceX fired employees who signed an open letter criticizing CEO Elon Musk and what they described as a culture of sexism at the company.
At the heart of the dispute is whether the NLRB’s administrative law judges are improperly shielded from presidential removal, potentially violating the separation of powers.
The panel included two Trump appointees and one appointee of George H.W. Bush.
