NLRB Issues Critical Guidance On Employer Handbooks, Rules and Policies, Including “Approved” Language

On March 18, 2015, NLRB General Counsel Richard F. Griffin, Jr. issued General Counsel Memorandum GC 15-04 containing extensive guidance as to the General Counsel’s views as to what types employer polices and rules, in handbooks and otherwise, will be considered by the NLRB investigators and regional offices to be lawful and which are likely to be found to unlawfully interfere with employees’ rights under the National Labor Relations Act (“NLRA” or the Act”).

This GC Memo is highly relevant to all employers in all industries that are under the jurisdiction of the National Labor Relations Board, regardless of whether they have union represented employees.

Because the Office of the General Counsel investigates unfair labor practice charges and the NLRB’s Regional Directors act on behalf of the General Counsel when they determine whether a charge has legal merit, the memo is meaningful to all employers and offers important guidance as to what language and policies are likely to be found to interfere with employees’ rights under the Act, and what type of language the NLRB will find does not interfere and may be lawfully maintained, so long as it is consistently and non-discriminatorily applied and enforced.

As explained in the Memorandum, the Board’s legal standard for deciding whether an employer policy unlawfully interferes with employees’ rights under the Act is generally whether “employees would reasonably construe the rules to prohibit Section 7 activity” – that is action of a concerted nature intended to address issues with respect to employees’ terms and conditions of employment. As we have noted previously, this General Counsel and Board have consistently given these terms broad interpretations and have found many employer policies and procedures, in handbooks and elsewhere, that appear neutral and appropriate on their face, to violate the Act and interfere with employee rights.  Many of these cases have involved non-union workplaces where there is not a union present and there is no union activity in progress.

There are two sections to the Memo. Part 1 of the Memorandum, which begins at page 2 and runs to page 20, offers a recap of NLRB decisions concerning 8 broad categories of policies, with summaries of the Board’s holdings and examples of policy language that the NLRB has found to unlawfully interfere with employees’ Section 7 rights and policy language that the Board has found did not unlawfully interfere with employees’ rights.  Section 2 reports on the General Counsel’s settlement with Wendy’s International LLC following an investigation of charges in which the General Counsel found portions of Wendy’s employee handbook unlawfully overbroad, with an explanation as to why the General Counsel found the policies in question to interfere with employees’ rights under the Act and a description of the language Wendy’s adopted to replace the problematic policies as part of its settlement of the charges. Both parts of the Memorandum will be of interest to employers and attorneys who draft, apply and enforce handbooks and other workplace policy documents.

Part 1: Examples of Handbook Rules found by the Board to be Lawful and Unlawful in recent decisions

• Employer Handbooks Rules Regarding Confidentiality - The Memorandum reviews the Board’s precedents holding that “Employees have a Section 7 right to discuss wages, hours, and other terms and conditions of employment with fellow employees, as well as nonemployees such as union representatives.” Interestingly, the Memorandum also states that “broad prohibitions on disclosing ‘confidential’ information are lawful so long as they do not reference information regarding employees or anything that would reasonably be considered a term or condition of employment, because employers have a substantial and legitimate interest in maintaining the privacy of certain business information.”  The Memorandum further “clarifies” by advising that “an otherwise unlawful confidentiality rule will be found lawful if, when viewed in context, employees would not reasonably understand the rule to prohibit Section 7 protected activity.”
• Employer Handbooks Rules Regarding Employee Conduct toward the Company and Supervisors - As explained in the Memorandum, “Employees also have the Section 7 right to criticize or protest their employer’s labor policies or treatment of employees.”  The Memorandum offers an overview of decisional law, with particular attention to cases involving rules that “prohibit employees “from engaging in ‘disrespectful,’ ’negative,’ ‘inappropriate,’ or ‘rude’ conduct towards the employer or management, absent sufficient clarification or context.”  As further noted, employee criticism of the employer “will not lose the Act’s protection simply because the criticism is false or defamatory.”
• Employer Handbooks Rules Regulating Conduct Towards Fellow Employees - This section of the Memorandum focusses on language and policies that the Board has found to interfere with the Section 7 right employees have ‘to argue and debate with each other  about unions, management, and their terms and conditions of employment,” which the General Counsel explains the Board has held will not lose their protection under the Act, “even if it includes ‘intemperate, abusive and inaccurate statements.” Of particular interest in this portion of the Memorandum is the examination of policies concerning harassment.  The Memorandum notes that “although employers have a legitimate and substantial interest in maintaining a harassment-free workplace, anti-harassment rules cannot be so broad that employees would reasonably read them as prohibiting vigorous debate or intemperate comments regarding Section 7 protected subjects.”
• Employer Handbooks Rules Regarding Employee Interaction With Third Parties - This section of the Memorandum focuses on employer policies and provisions that seek to regulate and restrict employee contact with and communications to the media relating to their employment.  The General Counsel notes that “(A)nother right employees have under Section 7 is the right to communicate with the new media, government agencies, and other third parties about wages, benefits, and other terms and conditions of employment,” and that rules “that reasonably would be read to restrict such communications are unlawful.” The General Counsel acknowledges however that “employers may lawfully control who makes official statements for the company,” any such rules must be drafted so as “to ensure that their rules would not reasonably be read to ban employees from speaking to the media or third parties on their own (or other employees”) behalf.
• Employer Handbooks Rules Restricting Use of Company Logos, Copyrights and Trademarks - The Board has found many employer policies, whether contained in employee handbooks or elsewhere, that broadly prohibit employees from using logos, copyrights and  trademarks to unlawfully interfere with employees’ Section 7 rights.  While the General Counsel acknowledges that “copyright holders have a clear interest in protecting their intellectual property,” the Board has found, with the approval of such courts as the Fourth Circuit Court of Appeals, that “handbook rules cannot prohibit employees’ fair protected use of that property.”  In this regard the General Counsel states in the Memorandum that it is his office’s position that “employees have a right to use the name and logo on picket signs’ leaflets, and other protected materials,” and that “Employers’ proprietary interests are not implicated by employees’ non-commercial use of a name, logo, or other trademark to identify the employer in the course of Section 7 activity.”
• Employer Handbooks Rules Restricting Photography and Recording - While many handbooks and policies prohibit or seek to restrict employees from taking photographs or making recordings in the workplace and on employer policy, the Memorandum states that “Employees have Section 7 right to photograph and make recordings in furtherance of their protected concerted activity, including the right to use personal devices to take such pictures make recordings.”  The Memorandum further notes that such policies will be found to be overbroad “where they would reasonably be read to prohibit the taking of pictures or recordings on non-work time.”
• Employer Handbooks Rules Restricting Employees from Leaving Work - With respect to handbook or other policies that restrict employees from leaving the workplace or from failing to report when scheduled, the Memorandum notes that “one of the most fundamental rights employees have under Section 7 of the Act is the right to go on strike,” and therefore “rules that regulate when an employee can leave work are unlawful if employees reasonably would read them to forbid protected strike actions and walkouts.”  Not all rules concerning absences and leaving the workstations are unlawful.  A rule would be lawful if “such a rule makes no mention of ‘strikes,’ ‘walkouts,’ ‘disruptions’ or the like” since employees should “reasonably understand the rule to pertain to employees leaving their posts for reasons unrelated to protected concerted activity.”
• Employer Conflict of Interest Rules - The Memorandum states that under Section 7 of the Act, employees have the right to engage in concerted activity to improve their terms and conditions of employment, even if that activity is in conflict with the employer’s interests.  It cites as examples of such activities that could arguably be in violation of broad conflict of interest policies as protests outside the employer’s business, organizing a boycott of the employer’s products and services and solicitation of support for a union while on non-work time.  The Memorandum notes that when a conflict of interest policy “includes examples of otherwise clarifies that it limited to legitimate business interests (note: as that term is defined by the General Counsel and the Board) employees will reasonably understand the rule to prohibit only unprotected activity.”

Part 2: The Wendy’s International LLC Handbook Cases

The second part of the Memorandum relates to the Board’s settlement of a series of unfair labor practice charges against Wendy’s International LLC (Wendy’s) alleging that various provisions of the handbook were overbroad and unlawfully interfered with employees’ rights under the NLRA.  The company entered into an “informal, bilateral Board settlement agreement.  In this section, the GC explains why various provisions were found unlawful and then sets forth negotiated replacement policies that the GC found did not violate the Act.  While not a formal “safe harbor” since this is the position of the General Counsel and not the Board, it offers very good advice for employers and attorneys in this area.  The Wendy’s policies that the General Counsel argued violated employees’ Section 7 rights and the replacements that the General Counsel found acceptable concerned the following areas:

• Handbook Disclosure Provision - The handbook in issue contained a broad prohibition against disclosure of the handbook and the information it contained without the company’s express prior written permission.  The General Counsel found this to be unlawful because it prohibited disclosure of employment practices to third parties such as a union or the NLRB.
• Social Media Policy - While the General Counsel acknowledged that employers have “a legitimate interest in ensuring that employee communications are not construed as representing the employer’s official position,” the General Counsel found the company’s rule to be overbroad since it prohibited a much broader range of communications that would be protected by Section 7.  This included photography and recording and no retaliation provisions.
• Conflict of Interest Policy
• Company Confidential Information Provision
• Employee Conduct
• Walking Off the Job Without Authorization
• No Distribution/No Solicitation Provision
• Restaurant Telephone; Cell Phone; Camera Phone/Recording Devices Provision

While Memorandum GC 15-04 arguably does not contain “new” information or changes in policy or case law, it should be useful for employers and practitioners (and employees) in that it provides a concise summary of the General Counsel’s views on this wide range of matters and examples of language that is likely to be found lawful in future proceedings.  Of course it is important to note that each charge is decided on its own facts and the actions and statements of employers and their supervisors in connection with the application and enforcement of the particular provision will almost always be relevant to the determination of whether the Board will issue a complaint on a particular ULP Charge.