‘Out of the blue’: Justice Kagan blasts Supreme Court for letting Trump fire labor officials while protecting Fed Chair Powell

The Supreme Court has allowed President Donald Trump to dismiss two Biden-appointed members of U.S. labor boards, despite federal laws preventing such politically motivated removals. According to Document Cloud, the decision came through a two-page unsigned order that declined to reinstate the fired members of the National Labor Relations Board and the Merit Systems Protection Board.

The ruling affects NLRB Chair Gwynne Wilcox and MSPB member Cathy Harris, who were fired by Trump in the early weeks of his second term. The court’s majority indicated that Trump is likely to demonstrate constitutional authority to fire labor board members for any reason, strengthening his claims of executive branch hiring and firing power.

According to Politico, Justice Elena Kagan, joined by Justices Sonia Sotomayor and Ketanji Brown Jackson in dissent, criticized the majority’s decision, particularly regarding their “out of the blue” statement about the Federal Reserve’s special status. Kagan argued that “The Federal Reserve’s independence rests on the same constitutional and analytic foundations as that of the NLRB, MSPB, FTC, and so on.”

Labor boards left without quorum as legal battle continues

The Supreme Court’s decision has effectively paralyzed both labor boards, leaving them without the necessary quorum to take substantive actions. This particularly affects the MSPB, which has numerous pending complaints from federal workers who claim they were unlawfully terminated by the Trump administration.

The majority attempted to ease concerns about the ruling’s implications for the Federal Reserve, describing it as a “uniquely structured, quasi-private entity” with a distinct history from other federal agencies. This qualification suggests the court might not support similar attempts to remove Federal Reserve leadership.

The case has been under consideration since April 9, with Chief Justice John Roberts initially preventing the officials’ reinstatement through an administrative order. The decision continues the Supreme Court’s recent trend of expanding presidential authority over executive branch personnel, particularly regarding firing powers, while simultaneously maintaining certain limitations for specific institutions like the Federal Reserve.