NLRB Issues New Rules on Validity of Handbooks and Policies

The NLRB’s General Counsel recently issued guidance for employers outlining the analysis by which the NLRB (“the Board”) will evaluate the lawfulness of handbook provisions and work rules promulgated and maintained by employers.

As we previously highlighted in a post entitled Labor Board Will No Longer Flyspeck Employer Policies and Handbooks, the Board’s decision in The Boeing Company announced that where a work rule is not unlawful on its face, promulgated in response to Union activity, or enforced in a discriminatory manner, they would evaluate whether or not specific employer’s handbook policies violate Section 7 of the National Labor Relations Act (NLRA) by considering: (1) the nature and extent of the potential impact on NLRA rights, and (2) legitimate justifications associated with the rule.

The General Counsel’s memorandum provides guidance regarding whether common types of employer handbook policies meet this standard, and accordingly are lawful or not, delineating three different categories of rules:

Category 1 – designated by the Board as generally lawful to maintain.

Category 2 – warrant individualized scrutiny by the Board.

Category 3 – designated as generally unlawful.

Category 1 Rules

Rules that fall within Category 1 are generally presumed to be lawful, and charges asserting rules falling into this category should be dismissed.

  • Civility Rules – including rules prohibiting disparaging other employees, rules prohibiting rude, discourteous, or un-businesslike behavior, and rules prohibiting offensive language.
  • Rules Prohibiting Photography or Video/Audio Recording At Work – This is a notable change from the NLRB’s 2015 decision in Whole Foods Market, Inc.
  • Rules Against Insubordination – Rules prohibiting 1) insubordination, 2) unlawful or improper conduct, 3) uncooperative behavior, 4) refusal to comply with orders or perform work, or 5) other on-the-job conduct that adversely affects the employer’s operation.
  • Disruptive Behavior Rules – Rules prohibiting disturbances or disruptions during work hours or disorderly conduct on employer premises. The General Counsel noted, however, that such rules should not be used to discipline employees for engaging in walk-outs or strikes.
  • Rules Protecting Confidential, Proprietary, and Customer Information – This is a notable change from the 2017 Verizon Wireless
  • Rules against Defamation or Misrepresentation
  • Rules Prohibiting Using Employer Logos – In a departure from the Board’s 2015 decision of Boch Honda, the Board will uphold bans on employees using company logos or intellectual property for non-business purposes.
  • Rules Requiring Authorization to Speak for the Company – The memorandum indicates that rules regulating who may speak on behalf of the company has no usual impact on employee Section 7 rights and is therefore lawful.
  • Rules Banning Disloyalty, Nepotism, or Self-Enrichment – These rules will be held to be lawful based on an employer’s legitimate and substantial interest.

Category 2 Rules

Rules that fall under Category 2 are considered to be close calls regarding the balancing of employer and employee interests. Employers should review their handbooks and seek legal advice regarding the following types of provisions:

  • Broad Conflict-Of-Interest Rules – Where the rules do not specifically target fraud and self-enrichment, they will be scrutinized.
  • Confidentiality Rules – Where such rules are not limited to customer or proprietary information, they may be interpreted to limit Section 7 rights.
  • Anti-Disparagement Rules – Rules regarding disparagement or criticism of the employer should be scrutinized (Those that prohibit disparagement of co-workers/customers may be fine).
  • Rules Regulating Use of the Employer’s Name (as opposed to the company’s logo which may be protected).
  • Rules Prohibiting Speaking to the Media.
  • Off-Duty Conduct Rules.
  • Rules Generally Prohibiting False Statements (as opposed to rules against defamatory statements, which are lawful).

Category 3 Rules

Category 3 Rules will be found by the Board to be unlawful, and employers should review their handbook policies to ensure the following categories of rules are not present:

  • Confidentiality Rules as to Terms and Conditions – Where rules prohibit discussion of wages, benefits, or working conditions they remain presumptively unlawful; and
  • Rules Prohibiting Involvement with Outside Organizations – Such rules are readily understood to cover employee involvement in unions and will remain presumptively unlawful.

Bottom Line

The General Counsel’s Memorandum continues the recent-trend at the Board of allowing employers to maintain common-sense policies that have a minimal burden on employee rights under the NLRA.

Given the fact that the memorandum delves into detail regarding the legality of common handbook provisions, it is a good idea for employers to take the opportunity to review their handbooks to ensure that they do not contain any Category 2 or Category 3 Rules, which may be subject to heightened scrutiny.