As you are likely aware, in recent years there has been much discussion from the NLRB regarding employee handbook language and the potential that such language does or could violate the National Labor Relations Act (NLRA).

On June 6, 2018, the Office of the General Counsel of the National Labor Relations Board (NLRB) issued a “Guidance on Handbook Rules Post-Boeing.” The Guidance sets forth three categories of rules that address whether an employer’s handbook policies are in compliance with the NLRA. The Guidance can be found at https://www.nlrb.gov/reports-guidance/general-counsel-memos.

The policies listed under Category 1 are those that are “’generally lawful’ either because the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of rights guaranteed by the Act, or because the potential adverse impact on protected rights is outweighed by the business justifications associated with the rule.” Those include:

a. Civility Rules. This includes behaviors such as name-calling, gossip, and rudeness, which the Guidance notes “does not implicate Section 7 at all.” This type of rule “advances substantial employee and employer interests, including the employer’s legal responsibility to maintain a workplace free of unlawful harassment, its substantial interest in preventing violence, and its interest in avoiding unnecessary conflict or a toxic work environment that could interfere with productivity, patient care (in hospitals), and other legitimate business goals.” Finally, it noted that “nearly every employee would desire and expect his or her employer to foster harmony and civility in the workplace”.

b. No-Photography/No-Recording Rules. Policies restricting use of camera-enabled devices to capture images or video, and those prohibiting employees from recording conversations, phone calls, images or company meetings without prior approval are acceptable. The Guidance recognized an employer’s legitimate and substantial interest in limiting recording and photography due to, among other things, security concerns, protection of proprietary or confidential information, and maintaining the integrity of operations. It also noted, however, that a ban on mere possession of cell phones at work may be unlawful if such phones are the employees’ main method of communication.

c. Insubordination, Non-cooperation, or On-the-job Conduct that Adversely Affects Operations. Policies that prohibit conduct such as being uncooperative with supervisors or otherwise engaging in conduct that does not support the employer’s goals and objectives, including insubordination or lack of cooperation with fellow employees, are legitimate. The Guidance noted that an employer has a legitimate and substantial interest in preventing insubordinate or non-cooperation at work as well as an appropriate expectation that employees will perform their work and follow directives. However, rules that indicate the employer could consider protected concerted activity to be a type of unsupportive conduct are not lawful.

d. Disruptive Behavior Rules. Policies prohibiting boisterous and other disruptive conduct, creating a disturbance on Company premises or creating discord with clients or fellow employees generally are not going to be interpreted to implicate Section 7 activity. However, the Guidance cautions against rules that appear to apply to “classic core protected concerted activity” such as walk-outs, protests, picketing, strikes, and the presentation to management of petitions or grievances. It noted that such conduct is “often engaged in because it is disruptive- in order to draw attention underline seriousness, or be used as an economic weapon”.

e. Rules Protecting Confidential, Proprietary, and Customer Information or Documents. This category includes rules that limit information concerning customers confidential financial data or other non-public proprietary company information, including business secrets. While these policies will generally not implicate Section 7 rights, the Guidance did note that such policies should be distinguished from policies that restrict employees from disclosing “employee information” which could be protected.

e. Rules Against Defamation or Misrepresentation. The Guidance concludes that the majority of defamatory behaviors, including misrepresenting the company’s products or services or employees, are unrelated to the NLRA. It noted that “employers have a significant interest in protecting themselves, their reputations, and their employees from defamation and slander. Businesses often live or die off their reputation, and there is a reason that under normal circumstances a party can recover civil damages for defamation. Promoting honesty among employees creates a healthy working environment and reduces the chance of a defamation lawsuit against the company. The justifications for this rule also overlap with the justifications for civility rules, in that harming coworker reputations can create a toxic workplace atmosphere.”

f. Rules Against Using Employer Logos or Intellectual Property. The Guidance affirms that rules prohibiting employees from using the Company’s logos, trademarks, or graphics for any reason without prior approval are legitimate, noting the “significant interest” in protecting intellectual property, which “can be worth millions of dollars and be central to a company’s business model.” It further noted that “employers also have an interest in ensuring that employee social media posts and other publications do not appear to be official via the presence of the employer’s logo.”

g. Rules Requiring Authorization to Speak for the Company. Likewise, the Guidance confirms that policies which limit designated employees to speak to the media on the Company’s behalf are legitimate.

h. Rules Banning Disloyalty, Nepotism, or Self-Enrichment. Finally, rules banning employees from engaging in conduct that is disloyal, competitive, or damaging to the company such as illegal acts in restraint of trade or employment with another employer, or engaging in acts that compete with the Company, interfere with judgment concerning the Company’s best interest or exploiting one’s position with the Company for personal gain are legitimate and do not violate the NLRA. However, it also noted that where a conflict of interest rule “goes beyond restricting these types of activities, it may be unlawful.

Category 2 contains employer handbook policies that warrant individual scrutiny by the NLRB. These will include:

a. Broad conflict-of-interest rules that do not specifically target fraud and self-enrichment;

b. Confidentiality rules broadly encompassing “employer business” or “employee information” (as opposed to confidentiality rules regarding customer or proprietary information (covered in Category 1) or confidentiality rules more specifically directed at employee wages, terms of employment, or working conditions (covered in Category 3);

c. Rules regarding disparagement or criticism of the employer (as opposed to civility rules regarding disparagement of employees);

d. Rules regulating use of the employer’s name (as opposed to rules regarding use of the employer’s logo/trademark);

e. Rules generally restricting speaking to the media or third parties (as opposed to rules restrictions speaking to the media on the employer’s behalf);

f. Rules banning off-duty conduct that might harm the employer (as opposed to rules banning insubordinate or disruptive conduct at work or rules specifically banning participation in outside organizations); and

g. Rules against making false or inaccurate statements (as opposed to rules against making defamatory statements).

Finally, Category 3 contains employer handbook policies that are unlawful to maintain. These include:

a. Confidentiality rules specifically regarding wages, benefits, or working conditions. This also includes rules that expressly prohibit discussion of working conditions or other terms of employment. The Guidance specifically concluded “there are no legitimate interests in banning employees from discussing wages or working conditions that are sufficient to overcome Section 7 rights.”

b. Rules against joining outside organizations or voting on matters concerning the employer. The Guidance recognized that employers have a “legitimate and substantial interest in preventing nepotism, self-dealing, fraud, or maintaining a financial interest in a competitor, and confirmed that rules against these ‘conflict of interest’ activities” fall in Category 1. However, it noted that “rules specifically prohibiting membership in outside organizations or participation in any “voting” concerning the employer do not address those concerns, or at least do not address them narrowly so as to accommodate legitimate concerns without infringing on significant Section 7 rights.”

The Guidance is just that and is not binding on a court. However, it is instructive as to what the NLRB will be looking for in terms of its prosecution of employers. Employers may now want to review handbook policies that were changed under the prior NLRB caselaw to ensure they meet the employer’s needs to address workplace conduct in light of this increased leeway to do so.

Anne-Marie L. Storey, Esq
Anne-Marie Storey, Esq
Rudman Winchell

 

 

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