NLRB General Counsel's Recent Report on Work Rules Tracks Areas to Watch - Employers of Union and Non-Union Work Forces Need to Be Aware of Employees' Protected Rights

by Holland & Knight LLP
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HIGHLIGHTS:

  • The NLRB General Counsel has a continued interest in investigating charges of unfair labor practice violations and bringing complaints for employer handbook content.
  • A work rule or handbook policy that has a chilling effect on employees' Section 7 activity may violate Section 8(a)(1) of the NLRA.
  • While the report's stated purpose is to provide clarity, its actual examples often demonstrate just how challenging it is to differentiate between a lawful policy and an unlawful one concerning the same subjects – especially because the General Counsel's consideration of the policy's "context" apparently leads to different outcomes for comparable provisions.

For the last several years, the National Labor Relations Board (NLRB or the "Board") has engaged in a well-publicized expansion of scrutiny for employer work rules and has liberally identified those rules that it believes unlawfully "chill" employee rights under the National Labor Relations Act (NLRA or the "Act"). The NLRB General Counsel has issued a report synthesizing recent NLRB treatment and enforcement actions for employer rules and handbook provisions in a professed effort to assist employers to conform their policies to the NLRB's standards.

The report, released on March 18, 2015, highlights common work rules that employers – of both union and non-union work forces – should recognize as potentially implicating areas protected by the Board and General Counsel. It underscores the General Counsel's continued interest in investigating charges of unfair labor practice violations and bringing complaints for employer handbook content. The report covers the following rule topics:

  • confidentiality provisions
  • professionalism and misconduct
  • anti-harassment
  • trademark usage
  • photography/recording in the workplace
  • media contact

It also provides an example of a recently settled unfair labor practice charge against Wendy's International LLC and Wendy's modified rules, which the General Counsel has given a green light.

Section 7 of the NLRA: A "Potential" Chilling Effect Is Unlawful

The Board's activity in this area is based on its protection of the rights afforded to all workers, whether union members or not, under Section 7 of the NLRA, which grants employees the right to engage in "concerted activities for the purpose of collective bargaining or other mutual aid or protection." A work rule or handbook policy that has a chilling effect on employees' Section 7 activity may violate Section 8(a)(1) of the Act. Yet, under the applicable case law, a rule need not on its face restrict such activity. A rule will be found unlawful if any of the following criteria are met:

  1. Employees would reasonably construe the rule's language to prohibit Section 7 activity.
  2. The rule was made in response to union or other Section 7 activity.
  3. The rule was actually applied to restrict the free exercise of Section 7 rights.

Most of the unlawful terms identified in the General Counsel report were deemed unlawful under the first prong because they were interpreted to have a potential chilling effect.

Naturally, it is difficult for an employer to divine consistently where the Board or the General Counsel will find a rule to have a sufficient potential chilling effect that justifies an unfair labor practice finding. While the report's stated purpose is to provide clarity on these points, its actual examples often demonstrate just how challenging it is to differentiate between a lawful policy and an unlawful one concerning the same subjects – especially because the General Counsel's consideration of the policy's "context" apparently leads to different outcomes for comparable provisions.

Lawful and Unlawful Rules

For instance, the following rule was lawful (because of its placement in the handbook section dealing with unlawful harassment and discrimination):

  • No "use of racial slurs, derogatory comments, or insults."

But, this rule was unlawful:

  • Do not make "insulting, embarrassing, hurtful or abusive comments about other company employees online," and "avoid the use of offensive, derogatory, or prejudicial comments."

Some Intellectual Property Issues Included in Protected Employee Activities

The General Counsel has even applied its exceedingly broad view of protectable Section 7 interests to seemingly innocuous and matter-of-course provisions concerning intellectual property, a topic most employers view apart from concerns about protected employee activity. Ostensibly, the General Counsel is concerned with protecting employees' rights to use a company's otherwise protected name and logo on picket signs, leaflets and other protest material, and will strike down a neutral intellectual property rule if it appears to threaten that right in its breadth. For example, the following provision is unlawful:

  • "Do not use 'other people's property,' such as trademarks, without permission in social media."

And, because the following was deemed to avoid an impermissibly broad ban on employee use of trademarked or copyrighted material, it was found lawful.

  • "Respect all copyright and other intellectual property laws. For [the Employer's] protection as well as your own, it is critical that you show proper respect for the laws governing copyright, fair use of copyrighted material owned by others, trademarks and other intellectual property, including [the Employer's] own copyrights, trademarks and brands."

Likewise, the General Counsel reported that the following confidentiality provision was unlawfully overbroad because a reasonable employee might view it as a restriction on disclosure of other employees' terms and conditions of employment, which is protected under Section 7.

  • "Never publish or disclose [the Employer's] or another's confidential or other proprietary information. Never publish or report on conversations that are meant to be private or internal to [the Employer]."

In contrast, the following rule was deemed facially lawful because the General Counsel did not view the term "confidential" as defined in an overbroad manner.

  • "Misuse or unauthorized disclosure of confidential information not otherwise available to persons or firms outside [the Employer] is cause for disciplinary action, including termination."

Compliant Company Handbooks Require Industry-Specific Allowances

The divergent treatment of similar provisions demonstrates that there is a fine line between lawful and unlawful work rules under the eyes of the General Counsel and copying and pasting lawful provisions may not guarantee a compliant handbook in the aggregate. Human resource professionals preparing work rules and handbooks should consider the report and other authority, and discuss with legal counsel familiar with the full analysis behind these distinctions, including certain industry-specific allowances, and the case law behind the rules, to assess the propriety of an employer's policies.

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.

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