Tag Archives: NLRB

NEW GUIDANCE: NLRB Clarifies Its Stance on Employee Handbooks

Over the past several years, the NLRB has “waged war” upon Employee Handbooks and found that many provisions in these handbooks violate employees Section 7 rights under the National Labor Relations Act.  As a result of this stricter position, many employers were nervous as to whether their handbooks would pass NLRB muster.

In December of 2017, with its decision in The Boeing Company, it appeared that the NLRB was reversing its position on handbook provisions when it set a new employer-friendly standard for reviewing handbooks.  Under the new standard, the NLRB said it would review handbook policies by balancing “(1) the nature and extent of the potential impact on the NLRA and (2) legitimate justifications associated with the rule.”  In addition, the NLRB will analyze rules under three categories:

  • Category One: Lawful rules that do not prohibit or interfere with NLRA rights or whose potential adverse impact on NLRA rights is overweighed by legitimate justifications.
  • Category Two: Rules that are lawful in some cases based on “individualized scrutiny.”
  • Category Three: Rules that are unlawful.

Yet, until recently, the NLRB remained silent with respect to the type(s) of policies that fall under each category.  Then, last month, the NLRB issued a guidance memorandum (entitled “Guidance on Handbook Rules Post-Boeing”), which provides guidance to employers on the legality of certain handbook rules following the Boeing Company decision.

The memorandum reiterates the three categories of handbook policies (as set forth in the Boeing Company decision) and provides the following examples of the types of policies that likely fall under each category.

Category 1: Rules that are Generally Lawful to Maintain Continue reading NEW GUIDANCE: NLRB Clarifies Its Stance on Employee Handbooks

NLRB Whiplash- Previous Joint Employer Standard Back on the Table


In an unfortunate move (though likely temporary), the NLRB elected to vacate its own ruling in the recent Hy-Brand joint employer case due to a conflict of interest involving one of the board members.  According to a report by the inspector general, one of the board members had previously represented an employer before the board on the same issue of joint employer status and should not have participated in the Hy-Brand case.

What the Courts Decision Means for Employers

Hy-Brand had overruled the infamous Browning-Ferris case that set forth a test for determining joint employer status that was nearly impossible for employers to pass. Now with Hy-Brand vacated, Browning-Ferris is back along with its pro-employee interpretation of joint employer status.

According to Browning- Ferris, a business qualifies as a joint employer if it exhibits indirect control or the ability to exert such control over employees. Thus, a franchisor that reserves the authority to control the terms and conditions of employment can be liable as a “joint employer. “

Takeaway

With the old standard back in play, employers, particularly franchisors, should exercise caution in the terms of franchisor agreements to ensure all employment decisions and control over the franchisee’s employees come from the franchisee, or run the risk of becoming liable for the franchisees mistakes.

Stay tuned for more developments that are sure to come soon.

NEW DEVELOPMENT – NLRB (Finally) Takes A More Pro-Employer Stance

With the change in Administration at the beginning of last year, it was widely anticipated that the NLRB would likely revisit many of its “pro employee” decisions from the Obama administration.  Well, in mid-December (following the expiration of NLRB Chairman Philip A. Miscimarra’s term), the NLRB took its first steps towards revisiting these decisions and overturned the following four controversial NLRB decisions issued between 2004-2016:

  1. Specialty Healthcare & Rehabilitation Center of Mobile (a 2011 decision relating to union-organizing and “micro-units”),
  2. Lutheran Heritage Village-Livonia (a 2004 decision issuing a new handbook review standard),
  3. Browning-Ferris Industries (a 2015decision issuing an expanded joint-employer standard) and
  4. E.I. du Pont de Nemours (a 2016 decision that limited an employer’s ability to make unilateral changes without collective bargaining).

What are the changes?

PCC Structurals, Inc., 365 NLRB No. 160 (Dec. 15, 2017)

This decision reverses the Specialty Healthcare & Rehabilitation Center of Mobile decision.

In Specialty Healthcare, the NLRB held that any bargaining unit consisting of a “readily identifiable” group whose members share a community of interest will be found appropriate unless an employer shows that employees excluded from the unit share an “overwhelming community of interest” with the proposed unit.  Prior to this ruling, employers only needed to show that that the unit should be expanded to include other employees who shared similar characteristics (a “community of interest”).  The end result – it was harder for employers to expand the union’s proposed bargaining unit and a union trying to organize in a workplace could more easily target “micro unit” without interference from the employer.

In the PCC Structurals decision, the Board returned to the prior standard that employers need only show a community of interest in order to expand a union’s proposed bargaining unit.

Take Home For Employers

This ruling makes it much easier for an employer to challenge (and expand) the scope of a union’s proposed bargaining unit in a union organization campaign.

The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017)

This decision reverses the Lutheran Heritage Village-Livonia decision.

In Lutheran Heritage, the NLRB set the standard for determining the lawfulness of handbook policies.  Under this standard, the NLRB would find that a handbook policy violated the National Labor Relations Act (NLRA) if “(1) employees would reasonably construe the language to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7 rights.”  This decision led to many of the headaches employers faced relating to many of their “standard” handbook policies (e.g. attendance, confidentiality, civility, conduct, discipline, media, social media, intellectual property, photography and recording, conflict of interest, to solicitation/distribution rules) and whether those policies could be “reasonably construed” to violate the NLRA.

In the Boeing Company decision, the NLRB rejected the Lutheran Heritage standard and replaced it with a more employer-friendly standard.  Under this new standard, the NLRB will review handbook policies by balancing “(1) the nature and extent of the potential impact on the NLRA and (2) legitimate justifications associated with the rule.”  In addition, the NLRB will analyze rules under three categories:

  • Category One: Lawful rules that do not prohibit or interfere with NLRA rights or whose potential adverse impact on NLRA rights is overweighed by legitimate justifications.
  • Category Two: Rules that are lawful in some cases based on “individualized scrutiny.”
  • Category Three: Rules that are unlawful.

Take Home For Employers

This ruling does not take away the NLRB’s ability to review handbook policies for violations of the NLRA.  However, under the new standard, employers are at least able to defend their legitimate workplace policies.

Hy-Brand Industrial Contractors, Ltd., 365 NLRB No. 156 (Dec. 14, 2017)

This decision reverses the Browning-Ferris Industries decision.

In Browning-Ferris, the NLRB set forth a new standard for determining whether a joint employer relationship existed – making it much easier for an employee to establish that two entities were joint employers.  Under this new standard, a joint-employer relationship could be found when an entity exercises “indirect control,” “limited and routine” control or even held the reserved right to control essential employment terms and conditions.  This new standard made it possible for many standard business relationships (like a service agreement) to become a joint employer relationship.

In the Hy-Brand decision, the NLRB rejected Browning-Ferris standard and returned the evaluation of a joint employer relationship to the prior rule — there must be “direct and immediate” control over essential terms and conditions to find a joint-employer relationship.

Take Home For Employers

This ruling means that joint-employer status will not result from control that is ‘limited and routine.’”  Instead, the control must be ‘direct and immediate’ (rather than indirect) for a joint employer relationship to exit.

Raytheon Network Centric Systems, 365 NLRB No. 161 (Dec. 15, 2017)

This decision reverses the E.I. du Pont de Nemours decision.

As a general rule, an employer may not make a unilateral change to the terms and conditions of employment of union-represented employees without first providing their union with notice and an opportunity to bargain about the changes.  Prior to DuPont, the NLRB would, however, allow employers to continue to make unilateral changes it had consistently made in the past without bargaining with the union (e.g. yearly changes to benefit plans).  Ine DuPont, the NLRB changed this long-standing exception and instead held that employers were required to collectively bargain about even this type of change.

In the Raytheon decision, the NLRB overruled DuPont and returned to the old standard that employers are allowed to change policies without a union’s permission if the employer has taken similar actions in past years.

Take Home For Employers

This ruling does not give employers the ability to unilaterally make any change they want to the terms and conditions of employment of union employees.  It only affects those policies that employers have unilaterally changed as a consistent past practice.  Employers still have a duty to bargain upon request over any and all mandatory subjects of bargaining, unless an exception to that duty applies.

New NLRB Ruling = Cautionary Tale for Employers

In a recent case (In-N-Out Burger, Inc., 365 NLRB No. 39.), the National Labor Relations Board (NLRB) determined that a West Coast fast food restaurant (In-N-Out Burger) violated the National Labor Relations Act (NLRA) by prohibiting employees from wearing any type of unauthorized buttons or insignia on their uniforms.

The Case

The company had a rule prohibiting employees from wearing any type of buttons, pins, or stickers on their uniforms – unless specifically required by the company.

The claim arose after a manager directed an employee to remove a “Fight for $15” button from his uniform. The “Fight for $15” button represented a union-sponsored effort seeking a $15 per hour minimum wage for fast-food restaurants and other related industries.

While the employee did remove the button, as directed, he also filed a unfair labor practices charge against the company claiming that the company’s rule violated the NLRA – specifically, employees’ rights to engaged in protected concerted activity.

The Ruling

It is well-settled that an employer violates the NLRA when it prohibits employees from wearing union insignia (including buttons/pins representing a nationwide movement relating to minimum wage) at the workplace, absent special circumstances. These special circumstances are where the wearing of buttons/pins would

  • Jeopardizes employee safety, damage machinery or products,
  • Exacerbates employee dissension in the workplace, or
  • Unreasonably interferes with a public image that the employer has established as part of its business plan.

These special circumstances are a narrow exception to the overall rule and it is the company’s burden to prove that the special circumstances exist to warrant the exception to the rule.

Here, the company argued the purpose of the rule was to maintain In-N-Out Burger’s carefully cultivated public image of being a “sparkling clean” restaurant, which is supported, in part, by the bright white uniforms and strict grooming requirements for employees; therefore, the exception applied.

The NLRB did not agree and instead found that the company failed to provide sufficient “public image” evidence to justify the company prohibiting employees from wearing a small “Fight For $15” button on their uniforms. The company was ordered to revoke its existing rule and to distribute a revised appearance policy to all employees that either policy that (1) does not contain the unlawful rule, or (2) provides the language of a lawful rule.

Takeaways for Employers

The NLRB’s ruling reminds all employers (union and non-union alike) that unless very specific and very limited exceptions apply, employers cannot prohibit employees from wearing buttons/stickers/pins that support union-related activity and/or address other terms and conditions of employment (like wages).

In addition, this case also reemphasizes the fact that most private employers – including non-union employers — are covered by the NLRA. As such, all private employers must follow the uniform policy standards established by the NLRB

Employers should review their policies carefully and ensure that all policies comply with NRLB standards. If there are any uncertainties regarding any policies, please seek the guidance of an HR Professional.

The NLRB Joins the employee misclassification bandwagon

A current hot topic in wage and hour law is Worker Misclassification (i.e. classifying a worker as an independent contractor instead of an employee). As we reported earlier, most recently in “DOL Partnership Regarding Worker Misclassification — 34 States and Counting”, the US Department of Labor has taken a very active role in attempting to combat worker misclassification – both by partnering with at least 35 states and other federal agencies when conducting worker classification investigations.

Not to be outdone by the Department of Labor, the General Counsel of the National Labor Relations Board recently issued an advice memorandum stating that the NLRB was to treat employee misclassifications as a violation of the National Labor Relations Act. Specifically, the General Counsel stated that that by informing workers that they are not employees, but rather independent contractors, an employer effectively interferes with the workers’ rights under Section 7 of the NLRA to organize a union and engage in other protected concerted activity.

This new memorandum is important to all employers because it adds another “player” in the misclassification game and with that, adds a whole new set of penalties that can be issued against an employer for misclassification of independent contractors. It is recommended that employers carefully review any independent contractor relationships they might have and work with either an HR Professional or qualified legal counsel to determine if the worker truly is an independent contractor.

And the war continues – the NLRB launches an assault on Handbooks

It seems that every day, the NLRB takes issue with provisions in (yet another) employee handbook. Today is no different. In a recent case (Chipotle Services LLC d/b/a Chipotle Mexican Grill), the NLRB has identified additional language in employer policies that it considers to be unlawfully overbroad and, as a result, has the potential of interfering with an employees’ right to engage in protected concerted activities.

Specifically, in this case, the NLRB identified language in 5 different policies that was, in the NLRB’s view, “overly broad.” The offending language:

  1. In a Social Media policy — Language that prohibits employees from posting incomplete, confidential or inaccurate information and making disparaging, false or misleading statements.
  2. In a Solicitation policy — Language that prohibits employee solicitation during nonworking time in working areas if the solicitation would be within visual or hearing range of customers.
  3. In a Confidentiality policy — Language that unlawfully limits the use of the employer’s name.
  4. In an Ethical Communications policy — Language that directs employees to avoid exaggeration, guesswork and derogatory characterizations of people and their motives.
  5. In a Political Activity policy — Language that prohibits employees from discussing politics and from using the employer’s name for political purposes.

With additional “taboo” phrases identified by the NLRB, it is recommended that employers take another look at their employee handbooks and verify that their policies do not interfere with employees’ Section 7 rights (the right to engage in protected concerted activities). This is accomplished by drafting policies where terms that have been found “overly broad” by the NLRB (e.g. “confidential” or “inaccurate information,”) are clearly defined or accompanied by examples. In addition, simply including a “disclaimer” (e.g. “This policy does not restrict any activity that is protected by the National Labor Relations Act.”) will not “save” an otherwise overly broad policy. Finally, when reviewing (or drafting employee policies), it is best to have an HR Professional or qualified legal counsel assist with the review.

The NLRB’s Handbook Assault Continues

In recent years, the National Labor Relations Board (“NLRB”) has waged a war against employer handbooks – actively seeking out those policies that, in the NLRB’s view, infringe on an employee’s rights to engage in protected concerted activity. With its release of guidelines (“Report of the General Counsel Concerning Employer Rules)” which sets forth the NLRB’s position on many “standard” handbook provisions, many employers may have thought that the war had ended. However, a recent decision (Casino Pauma) by an NLRB Administrative Law Judge (“ALJ”) reveals that employer handbooks are still very much on the NLRB’s radar.

The Case

The NLRB’s target was the employee handbook of an Indian Casino in California. In reviewing this handbook, the NLRB claimed that four provisions in the handbook infringed on employees “section seven rights” (i.e. an employee’s right to engage in protected concerted activity). The ALJ agreed.

The Four Provisions

Provision #1 – Prohibiting employees from conducting “personal business” during working hours

This provision prohibited employees from conducting “personal business or business for another employee during their scheduled working hours.” The ALJ found that this provision violated the National Labor Relations Act (“NLRA”) because it was overly broad and prevented employees from engaged in protected concerted activity during non-work time (e.g. breaks) during their scheduled working hours. Specifically, the ALJ found that the rule violated the NLRA  “because it is not properly restricted to ‘work time’ and thus bans protected activity during non-work time, such as time on lunch, breaks and before and after work.”

The fix: To avoid this problem, employers should verify that any policy prohibiting an employee from conducting “personal business” is restricted to the employee’s work time and not his (more broad) scheduled working hours.

Provision #2 – Prohibiting employees from engaging in solicitation activities that are disruptive

This provision prohibited employees from engaging in solicitation activities on behalf of the union if the “if the intended recipient expresses any discomfort or unreceptiveness whatsoever.” The ALJ found that this provision violated the NLRA because, as previously held in Ryder Truck Rental, Inc. employees have a right to “engage in persistent union solicitation even when it annoys or disturbs the employees who are being solicited.”

The fix: To avoid this problem, employers should remove this type of provision from their handbooks. However, if an employee’s solicitation efforts “cross the line” (i.e. turn into harassment, bullying, etc.), such conduct may violate the employer’s anti-harassment policy.

Provision #3 – Requiring a “disclaimer” for social media postings

This provision required employees to include an employer-approved disclaimer (e.g. “”The postings on this site are my own and do not represent my employer’s positions, strategies or opinions”) when posting comments about work issues to social media. The provision also prohibited employees from referring to third parties (i.e. coworkers, clients, vendors, or guest) in a social media post without that person’s consent and/or posting pictures “in conjunction with work-related postings.”

The ALJ found that this rule was overly broad and would serve to discourage employees from engaging in protected concerted activity (like making work-related complaints on social media wages, hours and working conditions).

The fix: To the extent that an employer wants to have this type of prohibition, the policy cannot be overly broad. Instead, these policies must be drafted very carefully and clearly specify exactly what conduct is prohibited (e.g. prohibiting such postings during an employee’s work time and/or prohibiting posts that divulge proprietary information – with a clear definition as to what constitutes “proprietary information”.)
Provision #4 – Requiring employer pre-approval for all solicitations

This provision required employees to obtain pre-approval before “soliciting Casino Pauma’s Team 20 Members, suppliers, or guests to purchase goods or services of any kind, or to make contributions to any organizations or in support of any causes, unless the General Manger has granted written approval in advance.” The ALJ found that this provision, too, was overly broad because it could be seen to include solicitations on behalf of unions.

The fix: To the extent that an employer wants to have this type of rule, narrowly tailor the provision and define exactly what types of solicitations must be “pre-approved.”

Prohibiting Workplace Recordings in Pennsylvania May be Permissible

In the face of the December 2015 NLRB decision (Whole Foods Market, Inc.), where the NLRB determined that an employer’s policy prohibiting workplace recordings violated the NLRA (see our previous post), employers have wondered if there is a way to prohibit workplace recordings. There may be a glimmer of hope for Pennsylvania employers, following a recent Pennsylvania Supreme Court decision (Commonwealth of Pennsylvania v. Smith), where the Court found that an employee’s act of surreptitiously recording a conversation with his former boss violated Pennsylvania’s Wiretapping and Electronic Surveillance Control Act.

The Facts

The employee had filed an internal complaint with the Company. The employee was later called into his supervisor’s office for a meeting (unrelated to his complaint) and the employee saw a copy of the complaint on the supervisor’s desk. Concerned that he may be terminated for “whistleblowing,” the employee decided to record the conversation with the supervisor using his iPhone. The conversation was recorded without the supervisor’s knowledge or consent.

As it so happens, during that meeting, the employee was terminated and he later filed a lawsuit for wrongful termination. During the course of the lawsuit, the employer learned about the recording and reported the former employee’s conduct to the State. The state subsequently filed charges against the former employee. The former employee was prosecuted for violating Pennsylvania’s Wiretapping and Electronic Surveillance Control Act, which makes it a felony for a person to intentionally record another person’s oral communications without the other person’s consent.

Impact on Pennsylvania Employers

In the Whole Foods Market decision, the NLRB acknowledged that certain states have laws prohibiting the recording of another person without his or her consent. In recognizing this, the NLRB conceded that employer policies consistent with such laws would be lawful – provided that those policies were narrowly tailored and specifically referenced the relevant state law.

Pennsylvania employers that currently have a policy banning workplace recordings (or who are considering prohibiting unauthorized workplace recordings), should ensure that any policy they have (or create) is narrowly tailored and that it set forth the specific bases for this policy – noting not only privacy and confidentiality concerns (among others), but also specifically referencing the Pennsylvania Wiretapping Act and any other Pennsylvania statute that prohibits nonconsensual recordings.

NLRB Says Even Non-Union Workers Have The Right To Strike

Did you think that the fact that your workforce was not unionized protected your Company from strikes? Well, a recent NLRB decision has made it clear that even non-union employees have the right to engage in a “true strike” without fear of discipline.

In Walmart Stores, Inc. vs. The Organization United For Respect At Walmart (Our Walmart), an Administrative Law Judge (“ALJ”) for the NLRB held that an employer cannot discipline a non-union worker for engaging in a true strike because such discipline was in violation of the employee’s Section 7 rights under the NLRA (the employee’s right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection).

In reaching this decision, the ALJ differentiated between a “true strike” (which includes work stoppages that non-unionized employees organize by themselves to bring attention to their objections to certain terms and conditions of employment) and an “intermittent work stoppage” (where employees engage in a pattern of striking for short periods, returning to work briefly, and then striking again). In short, the ALJ held that a true strike, even by non-union employees, is protected, while an intermittent strike is not.

In this case, the employees had organized a set of strikes lasting 1-3 days. During this time some of the Walmart employees missed work. While Walmart did not discipline anyone for participating in these strikes, Walmart did count the employees’ absences against them pursuant to the Company attendance policy. This ultimately resulted in some of the participants in the strike being disciplined or even terminated for participating in the strikes. The affected employees then filed a claim with the NLRB stating that Walmart had engaged in an unfair labor practice by disciplining these employees.

Walmart attempted to argue that the strikes were intermittent work stoppages not protected by the National Labor Relations Act, but the ALJ did not accept that argument. After a lengthy analysis, the ALJ concluded that while the strikes in question were a part of “a recurring set of strikes that OUR Wal-Mart coordinated to draw attention to an established list of concerns about Wal-Mart’s policies and working conditions … the similarities to unprotected intermittent work stoppages end there.”

The take home for employers, be incredibly careful when you are responding to your non-union workforce’s attempts to draw your attention to grievances in the workplace. Section 7 of the NLRA does not just protect Union employees, its protections extend to non-union employees as well.

Are Your Company’s Handbook Provisions Compliant with the National Labor Relations Act?

Over the past several years, the National Labor Relations Board (“NLRB”) has been engaged in an initiative against Employee Handbook provisions it believes violate the National Labor Relations Act (“NLRA”) – specifically section 7 of the NLRA (protecting an employee’s right to engage in protected concerted activity) and section 8 (making employer rules that “chill” an employee’s right to engage in Section 7 activity unlawful).

Through this initiative, the NLRB has targeted handbook provisions of union and nonunion employers alike and has opined that many of these “standard” provisions (i.e. provisions that typically appear in most Company Handbooks) violated the NLRA. In fact, earlier this year, the NLRB released a “Report of the General Counsel Concerning Employer Rules,” which sets forth the NLRB’s position on many “standard” handbook provisions.

Until recently, the NLRB was acting alone in this crusade. However, these charges are starting to be heard by federal courts nationwide and, in a recent decision (Hyundai Shipping Agency, Inc. v. NLRB, decided November 6, 2015), the U.S. Court of Appeals for the District of Columbia Circuit upheld the NLRB’s finding that three of the handbook provisions in question violated Section 8 of the NLRA.

What were the three handbook provisions that were found to be unlawful?

  1. A rule prohibiting employees from discussing matters under investigation by the employer (“investigative confidentiality rule”);
  2. A rule limiting the disclosure of information from the employer’s electronic communication and information systems (“electronic communications rule”); and
  3. A rule prohibiting activities other than work during working hours (“working hours rule”).

Why were these provisions unlawful?

With respect to the investigative confidentiality rule, the Court found that the provision was overly broad because it restricted the employees from discussing all matters under investigation. While the Court recognized that some matters under investigation (like a sexual harassment investigation) the employer could have a legitimate business reason why the investigation must be kept confidential, the Court found that the employer did not and could not set forth a legitimate business reason to have blanket rule making all matters under investigation kept confidential. Therefore, the policy, as written, violated the NLRA because it had a “chilling effect” on an employee’s right to engage in Section 7 activity.

With respect to the electronic communications rule, the Court found that the provision was overly broad because it restricted an employee’s ability to share information about the terms and conditions of employment. The policy stated that “employees should only disclose information or messages from [the employer’s electronic communication] systems to authorized persons.” The Court found that this policy was overbroad because the policy language did not differentiate between “confidential information” and other information. Instead, on its face, the policy arguably prohibited the transmission of all information, which the Court found violated the NLRA because it had a “chilling effect” on an employee’s right to engage in Section 7 activity.

With respect to the working hours rule, the Court found that the provision was overly broad because it prohibited employees from engaging in union-related activities during breaks. The policy stated that employees could be disciplined for “performing activities other than Company work during working hours.” The Court found that this policy was overbroad because the policy applied to “working hours” and was not limited to “working time.” The Court explained that “working hours” describes the period from the beginning to the end of a shift – including breaks, while “working time” excludes breaks. Therefore, the policy violated the NLRA because it had a “chilling effect” on an employee’s right to engage in Section 7 activity during non-working time.

What should employers do in response to this case?

Employers should review their Handbooks and verify that they do not have any provisions similar to those that were found to be unlawful in this case. In addition, employers should consider reviewing the NLRB’s guidance memorandum relating to Employee Handbooks and revising any policies that the NLRB have indicated may run afoul of section 8 of the NLRA.