The United States Supreme Court, through a majority (6-3) decision on Thursday, put on hold a lower court order, upholding the Donald Trump administration's removal of two members from the independent federal agency each was appointed to.
However, the Supreme Court also signalled to Trump such dismissals would not be permitted for the Federal Reserve, news agency AFP reported.
Gwynne Wilcox and Cathy Harris, both Democratic members of independent quasi-judicial labour boards, were appointed by Trump's predecessor, Democratic Party's Joe Biden. However, they were "abruptly" terminated by the new president's administration earlier this year
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While Wilcox was sacked from the National Labour Relations Board, Harris was removed as a member of the Merit Systems Protection Board.
In their separate lawsuits, Wilcox and Harris alleged they were fired "illegally." They also claimed that any decision to the contrary would also implicate the Federal Reserve.
"We disagree," the majority said.
"The Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States," the justices added.
The decision puts on hold the lower court's order to reinstate Wilcox and Harris. It also marks a major win for Trump in his bid to greatly expand presidential power over historically independent government agencies.
The case has been closely watched over what it could entail for the Federal Reserve, another independent agency with a rate-setting committee which holds immense power in the world's biggest economy and whose chairman, Jerome Powell, has been fiercely criticized by Trump.
A decision permitting termination of Federal Reserve board members would send shock waves rippling through the global economy, with the US central bank's independence also thrown into question.
However, the Supreme Court also signalled to Trump such dismissals would not be permitted for the Federal Reserve, news agency AFP reported.
Gwynne Wilcox and Cathy Harris, both Democratic members of independent quasi-judicial labour boards, were appointed by Trump's predecessor, Democratic Party's Joe Biden. However, they were "abruptly" terminated by the new president's administration earlier this year
Video
While Wilcox was sacked from the National Labour Relations Board, Harris was removed as a member of the Merit Systems Protection Board.
In their separate lawsuits, Wilcox and Harris alleged they were fired "illegally." They also claimed that any decision to the contrary would also implicate the Federal Reserve.
"We disagree," the majority said.
"The Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States," the justices added.
The decision puts on hold the lower court's order to reinstate Wilcox and Harris. It also marks a major win for Trump in his bid to greatly expand presidential power over historically independent government agencies.
The case has been closely watched over what it could entail for the Federal Reserve, another independent agency with a rate-setting committee which holds immense power in the world's biggest economy and whose chairman, Jerome Powell, has been fiercely criticized by Trump.
A decision permitting termination of Federal Reserve board members would send shock waves rippling through the global economy, with the US central bank's independence also thrown into question.
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