by What the Board did: The National Labor Relations Board (the Board) changed the law again on employee handbooks by modifying the legal standard of review for evaluating workplace misconduct rules. On August 2, 2023, the Board issued its long-awaited decision in Stericycle, Inc., overturning its more employer-friendly Boeing decision of six years ago. For a copy of the decision, see http://www.nlrb.gov.
Where the previous Boeing decision had based the Board’s scrutiny regarding a policy on the kind and effect of the policy, the Stericyle rejects that approach and returns to an earlier point of view. A policy or work rule can now be an unfair labor practice by the employer if an employee has a reason to think it affects his ability to speak up regarding work terms and working conditions. The Board’s standard for determining if a work conduct policy or rule unlawfully violates Section 7 of the National Labor Relations Act (i.e., the section that protects employee ‘concerted activity’ and communications regarding working conditions, policies, etc.) is whether an employee can articulate a reasonable interpretation of the rule as having a chilling effect on the exercise of Section 7 rights. Employers may rebut the employee’s interpretation by proving that the rule or policy advances a legitimate and substantial business interest and that they cannot advance that specific interest with a more closely tailored version.
What policies are at the greatest risk of being found unlawful? The recent Board decision doesn’t tell us what specific policies will be scrutinized. There are indications in recent memoranda from Board’s General Counsel that some confidentiality policies and mandatory employee meeting policies could be affected. We can also look to pre-Boeing decisions to get a picture of the kinds of policies most likely to be challenged.
The clearest risk is in what is referred to as workplace civility rules. Policies requiring employees to engage with co-workers positively are likely to be found unlawful under the Stericycle standard. Examples of policies that the Board found unlawful before adopting the Boeing analysis include:
- Expecting “employees to behave in a professional manner that promotes efficiency, productivity, and cooperation … to maintain a positive work environment by communicating in a manner that is conducive to effective working relationships with internal and external customers, clients, co-workers, and management.”
- Limiting how employees may properly complain about workplace issues, such as telling them, “If you feel you have not been paid all wages or pay owed to you, believe that an improper deduction was made from your salary, or feel you have been required to miss meal or rest periods, you are required to contact a manager, an HR business partner, or the integrity line.”
Recommendations for employers:
- Review and edit handbooks and other policy/conduct statements: Each policy identifying allowable or prohibited conduct should be reviewed and narrowed to reflect the substantial business reason behind it. It is irrelevant if the policy or rule can be reasonably interpreted so as not to infringe on employee rights if an employee could reasonably read the policy or rule to limit protected rights.
- Consider strengthening disclaimers regarding how policies are not intended to limit Section 7 rights: It may support the employer’s assertion that a reasonable employee would not see policy as limiting their rights if a strong disclaimer accompanies the policy. There is no guarantee, however, that written disclaimers will be sufficient to save a workplace conduct policy. The Board decision leans heavily on what conduct an employee subjectively believes the policy limits. The Board could determine that disclaimer language is not be enough to change an otherwise reasonable belief that a policy limits employee rights.
- Do a ‘Section 7’ review regarding incoming corrective actions for conduct or policy violations involving actions or communications by employees: Employers need to put themselves in the shoes of an employee–one that may be looking for a reason to challenge a rule–to see if there is any reasonable way to interpret a rule or policy to limit an employee’s right to work in concert with one or more other employees to discuss, explain, communicate, or organize action regarding workplace conditions, pay, benefits, etc. If there is room for someone to reasonably see the policy as limiting rights, corrective action may not be wise. The test is not whether the employer intends the rule to infringe on Section 7 rights but whether “an employee can reasonably construe” the policy or rule to be infringing. The issue is all about what the rule or policy says–it doesn’t matter if the employer has never enforced the rule or policy in the way an employee is ‘reasonably construing it.’
