General Counsel of NLRB offers Employers Relief on Handbook rules and Policies
By: Jeff Embleton
Continuing an effort to reverse or modify many of the employee and union-friendly policies promulgated by his predecessor, the NLRB’s General Counsel, Peter Robb, announced new guidance on handbook rules and policies following the NLRB’s decision in the Boeing Company (2017).
Many employers may recall that the former General Counsel of the NLRB, Richard Griffin, issued GC Memorandum 15-04 in March 2015 which resulted in most employers having to carefully review and revise handbook rules and policies in response to the Memorandum. Griffin’s Memorandum also resulted in increased investigation enforcement activities by the various Regional Offices of the NLRB involving handbook rules and policies. Specifically, in the GC Memorandum 15-04, the former General Counsel, following the Board’s decision in Lutheran Heritage Village – Livonia (2004) decided to emphasis the first prong of the three prong test announced in Lutheran Heritage:
Even if a rule does not explicitly prohibit Section 7 activity, however, it will still be unlawful if (1) employees would reasonably construe the Rule’s language to prohibit Section 7 activities; (2) the Rule was promulgated in response to union or other Section 7 activity; or (3) the Rule was actually applied to restrict the exercise of Section 7 rights.
Indeed, the new emphasis on the first part of the Lutheran Heritage standard resulted in number of enforcement charges against even facially neutral rules if the rule “could” be interpreted to have a chilling effect on employees and Section 7 rights.
However, under the Robb Memorandum, the new General Counsel said two very important things: (1) since the repudiation of the first prong of Lutheran Heritage in the Boeing Company case, the focus will now be on balancing the Rule’s impact on the employee’s ability to exercise their Section 7 rights and the Rule’s connection to the employer’s right to maintain discipline and productivity in the workplace; and (2) the Regions have been directed that ambiguities in Rules are no longer interpreted against the employer. In essence, the new guidance moves away from prohibiting rules that could be interpreted to impact Section 7 rights to reviewing the rules that would impact Section 7 rights. The Memorandum further described the three categories of Rules and how they will be reviewed:
Category 1. Rules that are Generally Lawful to Maintain.
The Memorandum directs that these Rules are generally going to be considered lawful either because the Rule does not prohibit or interfere with the exercise of Section 7 rights or because the potential impact on Section 7 rights is outweighed by the business justification associated with the Rule. Interestingly, the Memorandum spends most of its focus on providing guidance on rules that will be considered lawful, even if they could cover Section 7 activity. Those Rules include:
- Civility rules. Rules that regulate conduct in the workplace that has been a focus of attention by the former General Counsel and the Obama Board. For example, rules that regulate negative or disparaging remarks; rude behavior; offensive language and the like were fair game under the Obama Board. However, the new guidance makes clear that policies that are otherwise neutral will be considered lawful unless misapplied.
- No-photography and no-recording rules. This was a very controversial area as the Obama Board took the position that any blanket rules prohibiting video or audio recording were, on their face, unlawful because they tended to chill employee’s rights to record protected activity. Under the new interpretation, “no-recording” rules will be considered lawful (unless used for unlawful reasons). In rationalizing the change in the interpretation, the General Counsel recognized the employer’s legitimate and substantial interest in limiting recording and photography on their property because of security concerns, protection of property, protection of proprietary, confidential and customer information, avoiding legal liability and maintaining the integrity of operations.
- Rules against insubordination, non-cooperation or on-the-job conduct that adversely affects operations. After the issuance of GC15-03, rules that prohibited insubordination towards a manager or the company were universally held to be unlawful because they tended to chill employee’s Section 7 rights. However, under the new Memorandum, where the Rule prohibiting insubordination or lack of cooperation lacks any reference to Section 7 activity, the Rule will be considered lawful. The Memorandum was careful to note that there may be some activity that could warrant individual scrutiny, such as rules prohibiting disparagement or criticism of an employer. In other words, the rules may not be unlawful as written but may be unlawful as applied.
- Disruptive behavior rules. Similar to the discussion above, rules that prevent “fighting, roughhousing, horseplay, tomfoolery, and other shenanigans” generally will be considered lawful as well as workplace rules that prohibit “yelling, profanity, hostile or angry tones, throwing things, slamming doors, waving arms or fists, verbal abuse, destruction of property, threats or outright violence.” However, rules that prohibit walk-outs may invite additional scrutiny.
- Rules protecting confidential, proprietary, and customer information or documents. Rules that prohibit dissemination of the company’s or employee’s private information, trade secrets or other confidential information will generally be considered to be lawful under the new interpretation. Recognizing that “employers have an obvious need to protect confidential and proprietary information, as well as customer information,” the General Counsel concluded that on balance, the business justification outweighed any potential Section 7 concerns. However, rules that prohibit employees from discussing wages, benefits or working conditions will be considered on unlawful on their face.
- Rules against defamation or misrepresentation. With the explosion of social media, many employers have been subject to damaging statements and criticism by some of their own employees. Under the new interpretation, blanket rules which prohibit defamatory, false or misleading statements about an employer will generally be considered to be lawful. The General Counsel felt that while blanket rules against defamation or misrepresentation may possible cover some Section 7 activity, it was concluded that a majority of the behavior is unrelated to the National Labor Relations Act and, on balance, the business need for such a rule outweighed any concern over the impact on Section 7 rights. Of course, even a facially neutral rule, if improperly or unfairly applied, can result in a violation of the National Labor Relations Act.
- Rules against using employer’s logos or intellectual property. Rules that prohibit the use of the company logo or intellectual property without the company’s consent will not be considered to be lawful on their face.
- Rules requiring authorization to speak for a Company. Recognizing employers have an interest in insuring that only authorized representatives speak for a company, rules that prevent employees from responding to media requests or prevent employees from commenting on behalf of an employer will generally be considered to be lawful on their face.
- Rules banning disloyalty, nepotism or self-enrichment. Rules and policies that prohibit employees from engaging in conduct which is damaging to a company, disloyal to a company, competes with a company or interferes with the business of the company will be considered to be lawful.
Again, it is important to note that Category 1 Rules will be deemed to lawful on their face which is a change from the previous General Counsel’s interpretation. However, keep in mind that even facially neutral rules can result in violations of the NLRA if improperly applied.
Category 2. Rules Warranting Individualized Scrutiny.
In describing this Category, the Memorandum gave several examples of rules that would require additional scrutiny to determine the legality of the rules. Examples include: rules regarding disparagement or criticism of an employer (as opposed to rules that prohibit disparagement of employees), rules generally restricting employee’s right to speak to media or third parties (as opposed to a rule that prohibits from speaking to a media on behalf of the employer), rules prohibiting making false or inaccurate statements (as opposed to rules prohibiting making defamatory statements).
These rules are more difficult to define, but also tend to be much broader in their context. These likely will be decided on a case-by-case basis.
Category 3. Rules that are Unlawful to Maintain.
This Category considers rules and policies unlawful that would prohibit or restrict protected activity under the National Labor Relations Act and where they impact on the Section 7 rights outweighs any business justification. Specifically, these rules include:
- Confidentiality rules specifically regarding wages, benefits or working conditions. It has long be accepted that rules that prohibit employees from discussing salaries, wages, benefits or the terms and conditions of employment are unlawful. Likewise, rules that prohibit employees from disclosing to any “media source” information regarding an employer’s wages, benefits, or working conditions would be considered to be unlawful.
- Rules against joining outside organizations or voting on matters concerning employer. This, of course, strikes to the heart of union organization and rules that prohibit such activity have universally been considered to be unlawful.
The General Counsel’s newly issued interpretation promises to offer clarification for employers and organizations and a clear road map for professionals who write and interpret these policies and rules. We think this also continues the trend under the Trump Board of pulling back and overturning many of the Obama Board decisions which favored employee and union rights over rights of employers. However, we invite everyone to stay tuned as these cases unfold before the NLRB.