Earlier this month, the General Counsel of the National Labor Relations Board issued a memo instructing regional agency officials on how to assess workplace rules in light of the new standard established by the National Labor Relations Board (NLRB) in The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017). Together, the Boeing decision and the General Counsel’s memo shift the presumption regarding facially neutral workplace rules back in favor of the employer.
In the Boeing decision, the NLRB established a new standard for assessing when the mere maintenance of a workplace rule interferes with, restrains, or coerces an employee’s ability to exercise rights guaranteed by the National Labor Relations Act. The crux of the standard is a balancing test between an employer’s legitimate justification for maintaining the rule and how the rule adversely impacts the ability of affected employees to exercise their rights protected by the Act. Applying this balancing test, generalized facially neutral workplace rules are presumed lawful so long as affected employees are unlikely to interpret them in a manner that suppresses their ability to exercise their Act-protected rights. This is a significant departure from the NLRB’s former standard that interpreted generalized facially neutral workplace rules as banning all Act-protected activity that could conceivably be covered by a workplace rule regardless of context.
Following Boeing, workplace rules are catalogued into three categories: (i) category 1 rules are generally lawful to maintain; (ii) category 2 rules warrant individualized scrutiny; and (iii) category 3 rules are unlawful to maintain. The General Counsel advises that category 1 rules are comprised of rules whose reasonable interpretation does not prohibit or interfere with the exercise of rights guaranteed by the Act, and rules whose business justifications outweigh their impact on Act-protected rights. Examples of the category 1 rules include: (1) rules prohibiting employees from speaking on behalf of their employer without prior authorization; (2) rules banning disloyalty, nepotism, or self-enrichment; (3) civility rules; (4) rules barring photography and recording; (5) rules prohibiting insubordination and non-cooperation; (6) rules prohibiting defamation or misrepresentation; and (7) rules barring the use of employer logos or intellectual property.
Rules that are not obviously lawful are classified as category 2 rules. The General Counsel advises that these rules must be evaluated on a case-by-case basis, taking into consideration contextual factors such as the type and character of the workplace, to determine whether the business justification for the rule outweighs any interference with rights guaranteed by the Act. An important factor in determining the lawfulness of a category 2 rule is whether the rule is narrowly tailored in a fashion that accommodates both the employer’s legitimate business interests and limits the infringement on employees’ ability to exercise their Section 7 rights. The General Counsel provides the following as examples of rules that warrant individualized scrutiny: (1) conflict-of-interest rules that do not explicitly target fraud and self-enrichment and do not restrict membership in, or voting for, a union; (2) confidentiality rules that do not narrowly define employer business or employee information; (3) civility rules prohibiting criticism or disparagement of the employer; (4) rules regulating use of employer’s name, as opposed to employer’s logo or trademark; (5) rules generally restricting speaking to third parties regardless of whether speech is on employer’s behalf; (6) rules banning off-duty conduct that may harm employer; and (7) rules against making false or inaccurate statements.
Category 3 rules encompass those rules that are construed as facially unlawful. There are two types of rules that fall into this category: those that prohibit activities or rights guaranteed by the Act and those whose business justification are outweighed by the adverse impact on Act-protected conduct. The General Counsel provides the following examples of rules that are facially unlawful: (1) confidentiality rules that prohibit discussion of the terms and conditions of employment or working conditions; and (2) rules prohibiting joining outside organizations or voting on matters pertaining to the employer.
A more comprehensive analysis of the General Counsel’s guidance on workplace rules can be found here.