The National Labor Relations Board (NLRB) recently reversed course on its controversial Lutheran Heritage decision, which expanded the universe of handbook policies that violated the National Labor Relations Act (NLRA).
In Lutheran Heritage Village-Livonia, 343 NLRB 646, 647 (2004), the Board held that even if a workplace rule or policy did not explicitly restrict activity protected by Section 7 of the NLRA, it nonetheless violated the NLRA if employees would “reasonably construe” it to prohibit Section 7 activity. Section 7 of the NLRA gives employees “the right to self-organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purposes of collective bargaining or other mutual aid or protection . . . .” After Lutheran Heritage, employers witnessed a flurry of decisions from the Board invalidating seemingly harmless policies, including those advising employees to “work harmoniously,” and conduct themselves in a “positive and professional manner.”
In The Boeing Co., 365 NLRB No. 154 (2017), the NLRB held that it would not only evaluate the potential impact of employer policies on NLRA rights, but would now also evaluate the employer’s legitimate justification for the rule. To that end, the Board identified three categories of policies that will result from its analysis:
- Category 1: rules that the Board designates as lawful, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.
- Examples include the no-camera requirement at issue in The Boeing Co., which the Board found to be lawful because of the company’s articulated security concerns, federally-mandated non-disclosure obligations, and protection of its proprietary information, and rules requiring employees to abide by basic standards of civility.
- Category 2: rules that warrant individualized scrutiny in each case 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.
- Category 3: rules that the Board designated as unlawful because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by the employer’s justifications for the rule. An example of a Category 3 rule would be a rule that prohibits employees from discussing wages or benefits with one another.
The new standard announced in Boeing applies retroactively to all pending cases before the Board, and has the potential to provide much-needed relief for employers tasked with navigating onerous requirements for drafting and implementing valid policies. Because it is still unclear what specific policies the Board will classify as Categories 1, 2 or 3, employers are advised to consult employment counsel to evaluate current and proposed handbook policies and rules in light of the Board’s decision.