ARTICLE DETAIL

August 20, 2018

The NLRB’s New Standard for Evaluating Workplace Rules, Policies, and Employee Handbook Provisions Have Taken Flight – Are You on Board?

By:  Adam Konstas, Esquire

In Boeing Company and Society of Professional Engineering Employees in Aerospace, IFPTE Local 2001, 365 NLRB No. 154 (December 14, 2017, the National Labor Relations Board announced a new standard governing whether facially neutral workplace rules, policies, and employee handbook provisions unlawfully interfere with the exercise of protected rights under the National Labor Relations Act (NLRA), overruling its earlier decision in Lutheran Heritage Village-Livonia, 343 NLRB No. 75 (2004).  Under the previous Lutheran Heritage test, a workplace rule that did not explicitly prohibit protected activities, was not adopted in response to such activities, and was not applied to restrict such activities, nonetheless violated the NLRA if it could be “reasonably construed” by an employee to prohibit the exercise of NLRA rights – i.e., the “reasonably construe” standard. 

In the Board’s recent decision, the Respondent, Boeing Company, “maintain[ed] a policy restricting the use of camera-enabled devices such as cell phones on its property” which the Board referred to as the “no-camera rule,” because the work undertaken at Boeing’s facilities was highly sensitive (some of it being classified), Boeing’s facilities were targets for espionage, and Boeing faced a “realistic threat of terrorist attack.”  Boeing, 365 NLRB No. 154, at 1.  While the “no-camera rule” did not explicitly restrict activity protected by Section 7 of the NLRA, the Administrative Law Judge (ALJ) who heard the case applied the Lutheran Heritage test and found that Boeing’s no-camera rule violated Section 8(a)(1) of the NLRA because employees “‘would reasonably construe’ the rule to prohibit Section 7 activity.”  Id. at 1-2. 

In reversing the ALJ’s findings, the Board noted that the ALJ “gave no weight to Boeing’s security needs for the rule.”  Id. at 2.  The Board overruled the Lutheran Heritage ‘reasonably construe’ standard” and stated that it “will no longer find unlawful the mere maintenance of facially neutral employment policies, work rules, and handbook provisions based on a single inquiry, which made legality turn on whether an employee would ‘reasonably construe’ a rule to prohibit some type of potential Section 7 activity that might (or might not) occur in the future.”  Id

Since the Board found “multiple defects” with the Lutheran Heritage test, it adopted a new standard in its place.  See id.  Under the new Boeing standard, “when evaluating a facially neutral policy, rule, or handbook provision that, when reasonably interpreted, would potentially interfere with the exercise of NLRA rights, the Board will evaluate two things: (i) the nature and extent of the potential impact on NLRA rights, and (ii) legitimate justifications associated with the rule.”  Id. at 3.    Recognizing the practical and day-to-day impact of its decision, the Board reasoned that “this is an area where the Board has a special responsibility to give parties certainty and clarity” since “[m]ost work rules, employment policies, and employee handbook provisions exist for the purpose of permitting employees to understand what their employer expects and requires.” Id. at 14.  To this end, the Board also announced the following three categories of rules meant to provide such “certainty and clarity” to employers, employees, and unions:

  • Category 1: Rules that are lawful either because the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights, or the potential adverse impact of protected rights is outweighed by the justifications associated with the rule. The “no-camera rule” in Boeing fell into this category.  In a footnote, the Board overruled its previous cases in which it held that employers violated the NLRA by maintaining rules which required employees to foster “harmonious interactions and relationships” or to “maintain basic standards of civility in the workplace.”
  • 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 any adverse impact on NLRA protected conduct is outweighed by legitimate justifications for the rule. (i.e., broad conflict of interest rules, rules regarding off-duty conduct, rules restricting certain employee speech such as criticism of the employer, speaking to media or third parties, use of employer’s name).
  • Category 3: Rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA protected conduct, and the adverse impact on NLRA rights is not outweighed by the justifications associated with the rule (i.e., a rule that prohibits employees from discussing wages and benefits with one another or from joining outside organizations or voting on matters concerning the employer).

 See id. at 15. 

The Board further explained that while the mere maintenance of a rule may be lawful, it will still examine the circumstances under which the rule is applied to discipline employees who have engaged in NLRA protected activity, and therefore the application of the rule may violate the NLRA.  See id. at 16.

The Board in Boeing concluded that the “no-camera rule” was lawful.  See id. at 17. Although the rule may have an adverse impact on the exercise of NLRA rights, that potential impact was vastly outweighed by the important justifications articulated by Boeing, which included its own internal security protocols necessary to maintain accreditation as a federal contractor as well the need to meet other federally mandated requirements governing the protection of sensitive information, the protection of valuable proprietary information, the protection of employee personally identifiable information, as well as vital national security concerns – i.e., limiting the risk of Boeing becoming the target of a terrorist attack and limiting surveillance efforts of potentially hostile actors.  See id. at 17-18

On June 6, 2018, the NLRB General Counsel issued a new guidance memorandum which includes updated guidance about how regional offices should review unfair labor practice charges involving employer handbook provisions and work rules in light of the NLRB’s Boeing decision.  The General Counsel instructed that regional offices should not focus on whether a particular rule “could” be interpreted as adversely affecting Section 7 rights, but whether a rule “would actually” be interpreted to adversely affect such rights.  The General Counsel also instructed the regional offices that “ambiguities” in workplace rules should not be interpreted against the drafter and that “generalized provisions” should not be interpreted as banning all activity that could conceivably be included under the rule.  Finally, the guidance memorandum explores the three categories of rules announced by the Board in Boeing in greater depth and analyzes several common examples of workplace rules falling into each category. Click HERE to access GC 18 04, Guidance on Handbook Rules Post Boeing

As you review your own workplace rules, procedures, and employee handbook provisions (which should be done regularly, and at least annually), think about your own justifications for a particular rule.  While you may or may not maintain rules in the interest of national security, you should still have important justifications for maintaining your workplace rules and employee handbook provisions.   If you have questions about how the NLRB’s ruling in Boeing could affect your business, contact the Labor and Employment Attorneys at Pessin Katz Law, P.A.

Adam E. Konstas is an Attorney in PK Law’s Education and Labor Group.  He represents local school boards, superintendents, private schools, colleges, and private sector employers before federal and state courts, and federal and state civil rights agencies on a variety of matters, including employment discrimination, collective bargaining, and sexual harassment. Mr. Konstas also assists private sector employers with the development and updating of employee handbooks, procedures and training.  Mr. Konstas can be reached at 410-339-5786 or akonstas@pklaw.com.