Labor & Employment Law Update

Employers acquiring a business with a unionized workforce may soon have more flexibility to challenge the incumbent union's status than they have had for decades. On July 21, the D.C. Circuit held in Hospital Menonita de Guayama, Inc. v. NLRB that the National Relations Labor Board (NLRB ) never had the authority to impose its “successor bar” doctrine, a rule that generally requires a successor employer to continue bargaining with an existing union for up to a year after an acquisition. As one of the first appellate decisions to reject an NLRB doctrine since the U.S. Supreme Court ended automatic deference to federal agencies, other doctrines built on similarly thin statutory footing may be next.

On June 29, 2026, the Supreme Court overruled a 91-year-old precedent and held that the president may remove the heads of independent federal agencies at will. While the decision does not change any labor or employment laws, it could change who controls the agencies that enforce them. For employers, that means greater uncertainty and potentially more dramatic shifts in enforcement.

The Equal Employment Opportunity Commission (EEOC) formally rescinded the federal guidance employers have relied on for nearly 50 years when designing voluntary affirmative action plans under Title VII. In a June 29 vote, the EEOC voted to rescind the two documents that provide a long-standing roadmap for employers.

On June 4, the U.S. Equal Employment Opportunity Commission issued a new National Enforcement Plan (NEP), effective immediately, replacing the Biden-era Strategic Enforcement Plan. The NEP realigns federal enforcement around the current administration’s priorities and signals a significant shift in how workplace discrimination claims will be investigated and litigated. For employers, the change reshapes where federal risk will change and diverge from state law obligations.

The Ninth Circuit has warned employers that introducing a mandatory arbitration agreement during active class litigation, particularly when done through poor or misleading communication, can invalidate the agreement entirely. In Avery v. TEKsystems, decided January 28, 2026, the court affirmed a district court order refusing to enforce an arbitration policy introduced late in the lawsuit. The court found that the communications used to roll it out were misleading, one-sided, and fundamentally subverted the class action process.

There is a growing circuit split between the Third and Fifth circuits over whether employers can block National Labor Relations Board (NLRB) proceedings while raising constitutional challenges. The disagreement centers on the Norris-LaGuardia Act (NLGA), a nearly century-old law designed to keep federal courts out of labor disputes, which is driving one of the biggest fights in labor and employment law at the moment. With two circuits now at odds, Supreme Court review is increasingly likely and the question is deceptively simple: Can a federal court order the NLRB to stop its proceedings while a lawsuit challenging the Board’s constitutionality plays?

On August 19, 2025, the Fifth Circuit Court of Appeals upheld injunctions barring the National Labor Relations Board (NLRB) from prosecuting unfair labor practices (ULP)/charges against three employers, including Space X. This decision stems from the constitutional challenges to the way the NLRB is structured and raises broader questions about the current structure of the NLRB.