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Global employment briefing: USA, October 2018

  • USA
  • Employment law


New NLRB guidance on workplace policies and handbooks

On June 6, 2018, the National Labor Relations Board (“NLRB”) issued a lengthy 20-page memorandum (“Memo GC18-04”), which provides employers with guidance on the legality of handbook language and policies following the NLRB’s December 2017 decision in in The Boeing Company.

By way of background, prior to Boeing, the NLRB took the position that ambiguities in workplace rules would be interpreted against the employer. Boeing reversed this stance, and established a new standard balancing (i) the negative impact that a facially neutral rule may have on an employee’s rights under the National Labor Relations Act (“NLRA”), with (ii) the business reason for the rule.

The NLRB created three categories for workplace rules:

  • Category 1 - Rules that are lawful to maintain because (i) they do not prohibit or interfere with the employees’ NLRA rights, or (ii) the business justifications outweigh the adverse impact.
  • Category 2 - Rules that warrant individualized scrutiny on a case-by-case basis as to whether the rule would prohibit or interfere with NLRA rights and, if so, whether the impact is outweighed by legitimate considerations.
  • Category 3 - Rules that are unlawful because they restrict protected conduct, and the adverse impact outweighs any business justifications.

Although helpful, Boeing provided employers with limited guidance as to how exactly the NLRB would categorize workplace rules. The Memo filled this gap by providing illustrations of policies in each category.

Category 1 Rules: Lawful to Maintain

Among the Category 1 examples provided by the Memo are rules pertaining to:

  • Civility, including offensive or disruptive behavior and disparagement of employees
  • The use of cameras or other recording devices
  • Insubordination, non-cooperation or on-the-job conduct that adversely affects operations
  • Protection of confidentiality and customer information or documents
  • Defamation or misrepresentation
  • Use of employer logos or intellectual property
  • Disloyalty, nepotism, or self-enrichment

Category 2 Rules: Warrants Individualized Scrutiny

The legality of Category 2 rules are dependent on context, including the placement of the rule among other rules, workplace type and character, and whether the rule has actually restricted employees’ NLRA rights. Some examples of the Category 2 rules laid out by the Memo include:

  • Broad conflict-of-interest rules that neither specifically target fraud and self-enrichment nor restrict union membership
  • Overbroad confidentiality rules that broadly encompass “employer business” or “employee information”
  • Rules regarding disparagement or criticism of the employer
  • Rules regulating general use of the employer’s name
  • Rules banning off-duty conduct that might harm the employer

Category 3: Unlawful to Maintain

Category 3 captures rules that prohibit concerted activity, discussion of wages and employment contracts, and joining outside organizations or voting on matters concerning the employer.

The Memo signifies the NLRB’s “pro-employer” shift and serves to substantially increase employer confidence in their rules and handbook policies. That said, the Memo is not comprehensive and does not address countless employment policies, including arbitration provisions and internet restrictions. Importantly, employers must be mindful that a facially neutral Category 1 rule could be found unlawful if, when applied, it prohibits or interferes with employees’ NLRA rights. Therefore, employers must continue to revisit their policies to ascertain their lawfulness.