The harm is the process: Unconstitutional NLRB proceedings halted

The Fifth Circuit Court of Appeals threw a wrench into the gears of the National Labor Relations Board (NLRB) this week, and for good reason. In SpaceX v. NLRB, the court upheld a preliminary injunction blocking further NLRB proceedings during the case, finding that the Board’s structure is likely unconstitutional. Both the NLRB’s administrative law judges (ALJs) and its board members enjoy removal protections that improperly insulate them from presidential oversight. That insulation may sound like an obscure legal technicality. It isn’t. It goes to the heart of whether the American people, through their elected president, can hold government officials accountable when they exercise executive power.

The court’s reasoning builds on a major constitutional precedent: the Supreme Court’s 2010 decision in Free Enterprise Fund v. Public Company Accounting Oversight Board (PCAOB). That case—launched by the Competitive Enterprise Institute—remains a milestone in curbing the runaway “independence” of the administrative state. In Free Enterprise Fund, the Court held that the PCAOB’s structure violated the Constitution because its officials were protected by two layers of “for-cause” removal. The president could not remove them at will. Even the Securities and Exchange Commission commissioners who nominally supervised the PCAOB couldn’t fire them without providing cause. The practical result was an agency whose officials answered to no one directly accountable to the voters.

The Constitution doesn’t tolerate such an arrangement. Article II vests executive power in the president alone. Congress has latitude to design agencies in many ways, but the president must remain able to “take care that the laws be faithfully executed.” That requires the ability to remove executive officers who fail in their duties. If the president cannot remove them—or must rely on another board that is itself insulated—then accountability to the electorate erodes. Free Enterprise Fund reaffirmed this principle, striking down dual layers of insulation.

The Fifth Circuit affirmed preliminary injunctions halting NLRB proceedings. It held that NLRB ALJs’ two layers of for-cause protection are unconstitutional and that employers are likely to succeed on their challenge to Board member removal protections. The court also rejected the Board’s bid to duck review under the Norris-LaGuardia Act, confirming that federal courts may enjoin unconstitutional agency proceedings.

Unlike the technocratic Federal Trade Commission (FTC) imagined in Humphrey’s Executor (1935), today’s NLRB “wields substantial executive power.” Board members adjudicate unfair labor practice charges, seek enforcement of their orders in federal court, authorize petitions for injunctive relief, and appoint inferior officers. The mismatch between their power and the insulation from the president drives the Article II problem.

Nor do the NLRB’s Board members themselves avoid scrutiny. NLRB members do not merely issue reports or serve as neutral experts. They wield core executive authority. They prosecute unfair labor practice cases. They direct litigation and seek injunctions in federal court. They enforce federal law against private citizens and companies. In short, they exercise executive power while being insulated from the executive who is supposed to oversee them. Notably, the NLRB withdrew its defense of both the ALJ and Board member removal protections during the appeal.

This is not just an abstract debate for constitutional scholars. For businesses, the process itself often becomes the punishment. Companies hauled before the NLRB face years of litigation, staggering legal bills, and uncertainty that can cripple investment and hiring. Whether the Board ultimately loses in federal court is beside the point—the economic and reputational damage is already done. That is why the Fifth Circuit’s injunction halting NLRB proceedings is significant. As the panel put it: “When an agency’s structure violates the separation of powers, the harm is immediate—and the remedy must be, too.”

The elephant in the room remains Humphrey’s Executor. For nearly a century that Depression-era case has been cited as the shield protecting “independent” commissions from presidential oversight. But the rationale behind Humphrey’s was narrow: the powers of the FTC reviewed by the Supreme Court were limited to issuing reports and providing advice. It was not prosecuting cases in federal court or ordering private parties to comply with executive directives. Modern agencies, by contrast, regulate, investigate, prosecute, and enforce.

The Fifth Circuit’s injunction highlights that constitutional limits are not optional. Agencies cannot pick and choose which parts of the Constitution to honor. When the NLRB acts as prosecutor while insulating itself from democratic control, it undermines not only the separation of powers but also public trust in government.

Accountability is not a luxury in a republic. It is the mechanism by which voters ensure their government serves them rather than itself. Allowing agencies to exercise executive power while insulating them from presidential oversight severs that chain of responsibility. It leaves citizens at the mercy of unelected bureaucrats who answer to no one.

The NLRB’s defenders argue that “independence” is necessary to protect expertise or insulate decisions from politics. But politics is not a dirty word—it is the means by which citizens hold government accountable. Expertise has its place, but expertise without accountability is bureaucracy unmoored from democratic legitimacy.

The Fifth Circuit has not had the final word. The ruling is preliminary, and the case will likely work its way up to the Supreme Court. But the injunction is a welcome step toward restoring accountability in labor law enforcement. Businesses, workers, and voters all deserve a government that is accountable to the people—not to itself.