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Federal Labor Board Announces Important Legal Shift That Affects Virtually All Employers

By Stephen P. Bond and Christopher J. Carney | December 15, 2017

    You may not have seen it mentioned in news reports, but, on Thursday, the National Labor Relations Board announced a change in how it will analyze and review employers’ personnel policies and employee handbooks, marking a pronounced improvement for employers. And this change will affect you, whether or not you have union employees. Here’s why:

    Federal labor law grants rights to employees, virtually all employees, to act together in connection with the terms and conditions of their employment – regardless of whether they have formed a labor union. Because of that fundamental right, employers are generally not permitted to take actions which would impede the employees in acting in concert. If this notion is applied within the context of employer policies, including employee handbooks, language in such policies that would prohibit employees from taking joint actions may be found illegal.

    For the last decade, the National Labor Relations Board has taken a special interest in these issues. An employer may have promulgated a well-intentioned employee handbook years ago, and there may be no question that the employer acted innocently, without any intention of infringing on employees’ labor law rights; and, yet, in the Board’s decisions since 2004, it may well find that clauses within that handbook are not permissible. For example, a rule that prohibits conduct that impedes harmonious interactions and relationships, or prohibits inappropriate discussions about the company on social media, or requires employees to conduct themselves in a positive and professional manner, could all be found illegal because, in the mind of a hypothetical employee, those rules could be restricting his or her freedom to talk with other employees about working conditions.

    What’s more, the decisions of the Board have been very confusing with respect to exactly what wording was, or was not, going to be permitted. As yesterday’s decision explained, differing decisions led to these results:

Lawful Rule Unlawful Rule
• no “abusive or threatening language to anyone on Company premises”
• no “verbal abuse,” “abusive or profane
language,” or “harassment” 
• no “conduct which is . . . injurious, offensive, threatening, intimidating, coercing, or interfereing with” other employees
• prohibiting “conduct that does not support the . . . Hotel’s goals and objectives” 
• no “loud, abusive, or foul language”
• no “false, vicious, profane or malicious statements toward or concerning the . . . Hotel or any of its employees”
• no “inability or unwillingness to work harmoniously with other employees”
• no “negative energy or attitudes”
• no “[n]egative conversations about associates and/or managers” 

    This confusion largely stems from the Board’s use of this standard: whether employees would reasonably construe the language to prohibit rights given to them under federal law – a function of the Board, or its administrative enforcement personnel, guessing as to how a hypothetical employee might imagine that the rule might be applied to them.

    The Trump Administration has appointed new Board members which, yesterday, shifted the majority vote, and overruled the tests that have been used since 2004. This vote does not mean that an employer may engage in outright discrimination against an employer for engaging in his federal rights. But, it does mean that, where there is no reason to believe such discrimination is going on, an employer’s adopting of work rules that appear to be neutral and “common sense” will not be presumed to be unlawful just because someone could imagine a hypothetical in which it could be applied improperly.

    The Board announced categories it will use in the future when these issues arise:

Category 1 will include rules that the Board designates as lawful to maintain, either because

(i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights;

That is, going forward, there are going to be some rules which the Board simply accepts as being OK without asking any further questions. Rules that say things like, “conduct that impedes harmonious interactions and relationships is prohibited,” will simply be accepted as attempts to get employees to act civilly to one another.

or

(ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.

As an example, in Thursday’s case, Boeing had a rule against taking photographs inside their plant. While unhappy employees might want to take a picture of something that, they believe, supports a labor grievance, because the company is a defense contractor with a specific need for secrecy, that legitimate justification can be found to “trump” the hypothetical concern of the employees.

Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.

So, employers will have the chance now to argue that the concern raised is not likely and is outweighed by the employer’s reason for the rule.

Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule.

So, even under the current Board, some things will remain just plain unlawful. The obvious example is a rule that prohibits employees from discussing wages or benefits with one another.

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