"Employer-Friendlier" Standards for Workplace Rules and Policies from the NLRB’s General Counsel "Employer-Friendlier" Standards for Workplace Rules and Policies from the NLRB’s General Counsel

"Employer-Friendlier" Standards for Workplace Rules and Policies from the NLRB’s General Counsel

In a time when employers may feel common sense doesn’t seem all that common anymore, employers (both non-unionized and unionized) received a welcomed gift from the National Labor Relations Board’s (NLRB) new General Counsel, Peter B. Robb. General Counsel Robb recently issued a Guidance Memorandum (GC 18-04) outlining how the NLRB will interpret workplace rules, including employee handbook policies, going forward. The new Guidance relaxes some of the standards the NLRB applied to employer policies in the past several years (or decade) and recognizes employers' business needs. Nonetheless, employers need to continue using care when drafting or revising their handbooks or other workplace policies. As always, the details are the key.

On December 14, 2017, the NLRB issued its decision in The Boeing Company regarding the standard to be used to analyze the validity of employer rules, including employee handbook provisions under the National Labor Relations Act (NLRA). The decision overturned the Board’s 2004 decision in Lutheran Heritage Village-Livonia. The standard set by Lutheran Heritage, commonly referred to as the “reasonably construe” standard, was extremely employee-friendly, and literally meant that if an employee could “reasonably construe” that the employer rule or handbook provision prohibited Section 7 activity, the NLRB would invalidate the rule or handbook provision at issue.
 
For 13 years, the Lutheran Heritage “reasonably construe” standard has been applied to “invalidate facially neutral work rules solely because they were ambiguous in some respect.” In The Boeing Company, the Board stated that the “reasonably construe” standard has “rendered unlawful every policy, rule, and handbook provisions an employee might reasonably construe to prohibit any type of Section 7 activity [i.e., protected, concerted activity related to terms and conditions of employment],… has defied all reasonable efforts to make it yield predictable results; and… has been exceptionally difficult to apply, [creating] enormous challenges for the Board and courts and immense uncertainty and litigation for employees, unions, and employers.” 

In The Boeing Company, the Board established a new standard for evaluating a facially neutral policy or handbook provision. Specifically, The Boeing Company standard requires the Board to evaluate “two things: (i) the nature and extent of the potential impact on NLRA rights and (ii) legitimate justifications associated with the rule.” In other words, the Board now balances the potential negative impact on an employee’s ability to exercise his/her Section 7 rights, with the employer’s right to maintain discipline and productivity in the workplace. Most useful to employers, The Boeing Company sets out the three categories into which workplace rules and policies will be grouped:  Category 1 – those rules that are generally lawful to maintain, because when interpreted, the rules do not interfere with an employee’s Section 7 rights and any potential adverse impact on such rights is outweighed by the employer’s business justifications; Category 2 – those rules which require individualized scrutiny (case-by-case, fact specific analysis); and Category 3 – those rules that are generally unlawful, because the potential adverse impact on an employee’s Section 7 rights outweighs any possible business justification.

While the purpose of General Counsel Robb’s Memorandum is to provide Regional Directors of the NLRB with guidance relative to analyzing workplace rules and handbook policies post-Boeing, because Robb provides specific examples of the types of rules and policies that fall into each Boeing Category (see below), employers can use the Memorandum as a road map to review current (and potential) handbook policies and workplace rules.

The following rules, regularly found in company handbooks, have been identified by the Board as Category 1 Rules:
 
  1. Civility Rules – rules that set out acceptable employee behavior in the workplace are lawful. Examples of such Civility Rules would be rules prohibiting rude, discourteous, unprofessional or un-business like behavior. Civility Rules would also include rules prohibiting disparaging and offensive language, photographs, video and audio recordings.
  2. No-Photography / No-Recording Rules – rules that limit or prohibit photography and/or recording in the workplace are lawful, specifically rules that include language allowing photos and/or recording with prior approval.        
  3. Rules Prohibiting Insubordination, Non-Cooperation or On-the-Job Conduct that Adversely Affects Operations – such rules address behavior that is not “protected concerted activity” under the NLRB and as such, are lawful. 
  4. Rules Protecting Confidential, Proprietary and Customer Information/Documents – so long as the confidential and/or propriety information being protected does not involve employee or employee wage information, as such rules are lawful. The Guidance distinguishes lawful policies in place to protect “employee records and documents” from general “employee information,” which the Guidance states could fall into Category 2 or 3.
  5. Rules Against Defamation or Misrepresentation – it should go without saying that rules prohibiting employees from mispresenting an employer’s products or services are lawful.
  6. Rules Against Using Employer Logos and/or Intellectual Property – employers have the right to protect their logos and other intellectual property by limiting use of same by employees.
  7. Rules Requiring Authorization to Speak on the Company’s behalf – employers have significant interest in controlling who speaks for the company. This is different than prohibiting an employee from speaking about the company, generally.
  8. Rules Banning Disloyalty, Nepotism and/or Self-Enrichment – rules that prohibit conflicts of interest are lawful, as such conflicts of interest can have a serious detrimental impact on a company’s financial stability and revenues.
The following types of rules would be considered Category 2 rules:
 
  1. Broad conflict-of-interest rules that do not specifically target fraud and self-enrichment.
  2. Confidentiality rules that broadly encompass “employer business” or “employee information” as opposed to those encompassing customer or proprietary information.
  3. Rules to prohibit criticism of the employer as opposed to co-workers and/or customers/clients.
  4. Rules restricting general speaking to the media, as opposed to rules prohibiting/restricting speaking on the employer’s behalf.
  5. Rules banning off-duty conduct that might harm the employer, as opposed to insubordinate or disruptive conduct at work.
  6. Rules banning false or inaccurate statements, as opposed to making defamatory statements.
  7. While not automatically unlawful, Category 2 Rules will require a fact specific, case-by- case analysis weighing the adverse impact on an employee’s Section 7 rights against the employer’s business justification for the rule.
 
The following types of rules would be considered Category 3 rules:
 
  1. Confidentiality rules that prohibit discussion of wages, benefits and/or working conditions are unlawful.
  2. Rules prohibiting employees from joining outside organizations or that require employees to refrain from voting on matters that effect or concern the employer are unlawful.
The Memorandum cautions that The Boeing Company decision only applies to the maintenance of facially neutral rules and that rules that specifically ban protected activities or are promulgated directly in response to protected activities remain unlawful. Additionally, the application of a facially neutral rule against an employee engaged in protected activity is still unlawful as a neutral handbook rule does not render protected activity unprotected.

Although neither The Boeing Company decision nor the Memorandum speak to every single workplace rule or policy (i.e., there is no mention of (i) policies requiring that investigations and certain proceeding be treated as confidential, (ii) policies regarding participation in investigations, (iii) policies limiting use of company assets (phones, computers, email, internet) for business purposes only or (iv) social media policies), employers should take advantage of the new “employer-friendly” standard in reviewing current policies and rules.

If you would like more information on appropriate workplace policies or assistance in developing a formal employee handbook or manual, please contact Maureen Maffei or another member of Ice Miller’s Labor, Employment and Immigration Group. We regularly work with our clients to develop best practices for their businesses and welcome the opportunity to assist you.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.
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