In a recently released memo, the NLRB General Counsel confirmed the Board’s December 2017 signal of a shift in how the Board will scrutinize employer personnel policies. In December 2017, the NLRB changed course when it replaced the Lutheran Heritage standard, which had been aggressively used by the Board to invalidate personnel policies, with the Boeing standard (as discussed in our post from December 2017, “The NLRB’s Holiday Gift to Employers”). The Lutheran Heritage standard evaluated whether employees could “reasonably construe” a policy as barring them from exercising their rights under the NLRA. If the answer was “yes,” the policy was improper. The Lutheran Heritage standard was often applied in a manner that gave the appearance that the NLRB thought employees were lacking in intellect or common sense. Thus, the switch to the Boeing standard was generally celebrated by employers.
Even so, many employers felt that although the Boeing standard was a step in the right direction, it was somewhat complicated. In response to these criticisms, on June 6, 2018, NLRB General Counsel Peter Robb issued GC 18-04 “Guidance on Handbook Rules Post-Boeing.” This guidance provides examples of the policies (which he refers to as rules) that would fit into each of the three categories, and also makes it clear that the NLRB will no longer interpret ambiguities in rules against the drafter, “generalized promises should not be interpreted as banning all activity that could be considered included.”
The memo explains that the Boeing standard balances the personnel policy in question’s impact on NLRA-protected rights with the employer’s legitimate business justifications. The Boeing analysis uses three categories to determine the legality of rules:
Category 1: Rules that are Generally Lawful to Maintain
Category 2: Rules Warranting Individualized Scrutiny
Category 3: Rules that are Unlawful to Maintain
The memo goes on to state that Category 1 includes rules that may have been found unlawful under the Lutheran Heritage standard. It also explains that the types of rules in this category are generally lawful because the rules do not prohibit or interfere with the exercise of NLRA-protected rights or because there are business justifications associated with the rule. Rules in this category include:
(a) civility rules;
(b) no photography, no-recording rules;
(c) rules against insubordination, non-cooperation, or on-the-job conduct that adversely affects operations;
(d) disruptive behavior rules;
(e) rules protecting confidential, proprietary, and customer information or documents;
(f) rules against defamation or misrepresentation;
(g) rules against using employer logos or intellectual property;
(h) rules requiring authorization to speak for company; and
(i) rules banning disloyalty, nepotism, or self-enrichment.
The memo provides that charges alleging that rules in Category 1 are facially unlawful are to be dismissed, recognizing however, that special circumstances could render a normally lawful rule in Category 1 unlawful. Facially lawful rules cannot be used to prohibit protected activity or to discipline employees for engaging in protected activity.
Category 2 rules are to be evaluated on a case-by-case basis. Such rules are not facially lawful or unlawful. If rules in this category restrict NLRA-protected rights, then the question is whether the employer’s business interest in having the rule outweighs the restriction on NLRA-protected rights. Some “possible examples” of Category 2 rules are:
(a) broad conflict-of-interest rules that do not specifically target fraud and self-enrichment and do not restrict membership in, or voting for, a union;
(b) confidentiality rules that encompass employer business or employee information;
(c) rules regarding disparagement or criticism of the employer;
(d) rules regulating the use of the employer’s name;
(e) rules generally restricting speaking to the media or third parties;
(f) rules banning off-duty conduct that might harm the employer; and
(g) rules against making false or inaccurate statements.
Category 3 rules are unlawful to maintain because they prohibit or limit NLRA-protected conduct and the adverse impact on NLRA-protected rights outweigh any justifications for them. Category 3 rules include:
(a) confidentiality rules specifically regarding wages, benefits, or working conditions; and
(b) rules against joining outside organizations or voting on matters concerning.
In light of Boeing and GC18-04, employers should be more confident in their ability to maintain appropriate policies for their workplaces, including those that dictate professional behavior. The new approach is clearer and provides for a balancing of employer justifications with employee rights, resulting in common-sense personnel policies being upheld as lawful. Employers are now better positioned to defend attacks on their well drafted, common-sense personnel policies.
Summer associate Ryan Larson assisted in preparing this blog post.