NLRB’s Division of Advice Finds Two At-Will Employment Policies Lawful

by Morgan Lewis
Contact

Advice memoranda describe limits of potential challenges to at-will employment policies under the NLRA.

On October 31, the National Labor Relations Board's (NLRB's or Board's) Division of Advice issued two memoranda regarding at-will employment policies. The Board's Acting General Counsel has recently prosecuted charges alleging that at-will employment policies violate the National Labor Relations Act (NLRA or the Act) if the disclaimer can be interpreted as a waiver of employees' right to seek change to the at-will policy through collective bargaining. These cases provided little guidance for employers on whether and how they should revise language commonly found in employee handbooks and employer policies that describes the employment relationship as "at will." The two October 31 Advice Memoranda provide some guidance and should give employers a better understanding of the circumstances in which at-will policy language will, or will not be, challenged under the NLRA.

Prior Cases Involving At-Will Employment Policies

In American Red Cross Arizona Blood Services Region, an NLRB administrative law judge found that the employer had violated the NLRA by maintaining the following language in a form that employees were required to sign: "I further agree that the at-will employment relationship cannot be amended, modified or altered in any way."[1] The judge concluded that this language effectively required an employee to waive his or her Section 7 rights "to advocate concertedly" and change his or her at-will status. In another case earlier this year, Hyatt Hotels Corporation settled an NLRB complaint by agreeing to change policy language that required an individual contract signed by the employee and an executive to alter the employee's at-will status.

Based on the American Red Cross and Hyatt cases, many employers were concerned that the NLRB's Acting General Counsel would aggressively challenge many forms of at-will employment policies.

The October 31 Advice Memoranda

In Rocha Transportation, No. 32-CA-086799, the Division of Advice,[2] concluded that the NLRB regional office should dismiss a charge directed at the following policy language:

No manager, supervisor, or employee at Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will. Only the president of the Company has the authority to make any such agreement and then only in writing.

The Division of Advice determined that this language "would not reasonably be interpreted to restrict an employee's Section 7 right[s]." The Division of Advice explained that "the provision explicitly permits the Employer's president to enter into written employment agreements that modify the employment at-will relationship, and thus encompasses the possibility of potential modification of the at-will relationship through a collective-bargaining agreement that is ratified by the Company president."

Similarly, in SWH Corporation (Mimi's Café), No. 28-CA-084365, the Division of Advice concluded[3] that the NLRB regional office should dismiss a charge directed at the following language:

No representative of the Company has authority to enter into any agreement contrary to the foregoing "employment at will" relationship.

This language presented a closer question of whether employees could read the provision to restrict Section 7 rights as in American Red Cross. The Division of Advice explained, however, that the provision simply highlighted the employer's policy that its own representatives may not modify the at-will relationship and reinforced that the employer's handbook did not create an express or implied contract of employment. The provision did not require employees to refrain from seeking a change in at-will status or to agree that their at-will status could not be changed. On this basis, the Division of Advice distinguished the American Red Cross case. The Division of Advice also specifically pointed out that the American Red Cross case was settled prior to Board review, suggesting that the Division of Advice does not feel constrained to follow the administrative law judge's decision in that case.

Implications

The Board's recent foray into the world of nonunion employee handbooks—including at-will employment, social media, and confidentiality policies—has led to uncertainty in the employer community regarding a host of employer policies that are not intended to address employee rights under the NLRA, but could be construed to "chill" those rights.[4] Although memoranda written by the Division of Advice are not binding precedent, they provide valuable insight as to the circumstances in which the Acting General Counsel will prosecute an unfair labor practice charge. The two October 31 Advice Memoranda indicate that the Acting General Counsel's prosecution of charges concerning at-will employment policies will not be as wide-ranging as feared, and they provide some guidance to employers as to policy language that should not raise NLRA concerns.


[1]. Am. Red Cross Ariz. Blood Servs. Region, No. 28-CA-23443 (Feb. 1, 2012), available here.

[2]. View the October 31 Rocha Transportation Advice Memorandum here.

[3]. View the October 31 Mimi's Café Advice Memorandum here.

[4]. For more information on recent NLRB decisions regarding employee handbooks, see our October 2, 2012, LawFlash, "NLRB Strikes Down Employee Handbook Language and Issues First Social Media Decision," available here.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morgan Lewis | Attorney Advertising

Written by:

Morgan Lewis
Contact
more
less

Morgan Lewis on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
Feedback? Tell us what you think of the new jdsupra.com!