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NLRB Establishes New Standards for Employee Rules and Handbooks

By September 19, 2023February 27th, 2024No Comments

In August, the National Labor Relations Board (NLRB) made a significant change in the way it evaluates work rules. In a decision regarding a company called Stericycle, Inc., the NLRB abandoned a standard it had used since 2017 to evaluate the legality of work rules and employee handbooks, returning to an older standard that holds that any rule that can be interpreted as having a chilling effect on protected concerted activity can be considered a violation of the National Labor Relations Act (NLRA) Section 7.

Although this ruling is not technically new, it represents a major change for both unionized and nonunionized workplaces. Employers will need to carefully examine the rules and requirements they hold for employees and evaluate whether they could be interpreted this way. If you’re drafting a new employee handbook or you already have one in place, you should take a close look at the rules you have written in case they need to be updated. Let’s take a look at why this is important.

The NLRB and NLRA

The NLRA, also known as the Wagner Act, is a 1935 law that forms the main legal framework for collective bargaining and concerted workplace activity, more commonly known as unionizing. The NLRB is a federal agency that oversees and enforces the NLRA, gathering evidence, making rulings, and conducting union elections as a neutral third party.

The NLRA and NLRB are not restricted to unionized workplaces or those attempting to unionize. The agency can also work to protect and enforce the rights of workers who engage in what is called “concerted activity.” This is important because, in the case of this new standard, it applies to any workplace, whether or not they have a collective bargaining agreement.

Section 7

Section 7 of the NLRA governs employers interfering with employee rights to engage in collective bargaining or protected concerted activity. The new ruling is aimed in particular at any cases of overbroad employee rules that employees can reasonably interpret as having the effect of discouraging them to act upon their NLRA Section 7 rights. The NLRB will use this ruling as precedent and consider whether the rules are reasonably necessary for the business interests of the employer and whether this outweighs the legitimate concern of the employees.

What this means for you

If you’re concerned that your handbook or employee rules might violate this new standard, you’ll need to take a close look at them, particularly any rule where employee communication and confidentiality are discussed. A quick look at the recent ruling isn’t going to provide much guidance, but fortunately, the NLRB has put together a list of memoranda exploring many examples where this rule was invoked. Here are some of the more common ones:

Ethical communications

Many companies spell out a particular set of values, expectations, and rules when discussing workplace matters, including between coworkers, with people outside of the organization, and on social media. Some NLRB rulings have found that these rules are so broad that they can be interpreted in a way that makes employees feel unable to discuss their workplace conditions, which is protected concerted activity.

For example, if you have a social media code of conduct dictating that the employee cannot disparage clients, customers, vendors, coworkers, or the organization. This can be interpreted to mean that a legitimate concern, for example being asked to work long hours, relative salaries, or other topics, cannot be discussed. In many of the memoranda, the NLRB upholds that a business can forbid disparaging customers, clients, or vendors, they feel that being able to interpret a rule as meaning employees cannot disparage their employer is too broad and is a violation of Section 7 because it does not balance business interests with the rights of the employees.

Another example revolves around a supermarket employee who posted concerns directed at customers who came into the store during the COVID-19 pandemic. The company terminated the employee for disparaging customers, and the NLRB found that the employee’s comments were not protected. Although it pertained to health and safety, the employee was not engaged in concerted activity or directing their criticism toward employer policy. In the eyes of the board, this was a legitimate violation of a fair company communication ethics rule.

The key takeaway is that you have to review these sorts of policies in your handbook and be very careful about wording. Many of the NLRB rulings feel that employers need to be highly specific and exact in their wording when discussing communications.

Third-party investigations

Another tricky area is the topic of third-party investigations, particularly from government agencies. Some organizations have a policy that employees must disclose their participation in an investigation, interview, or evidence gathering. However, the NLRB, as an example of a third party who engages in this sort of activity, found that the wording of these rules can be interpreted to mean that employees have to share any confidential information, which is a violation of their rights per Section 7.

If your organization has such a rule, you need to be very careful with wording and make sure you’re specifying what type of investigation, who it is directed at (the company or individual employees), and that the rule does not prevent employees from invoking their rights under the NLRA.

Get critical guidance on difficult issues from 501(c) Services

As career-long nonprofit professionals, we are experts in the field and well-acquainted with the many challenges your organization faces. We can partner with you to help advise you on difficult issues like employee rules and handbooks and to assist you in locating indispensable resources to help you meet your organization’s goals. If you’d like to learn more about our team and services, get in touch.


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(Photo by Christina Morillo, Christina Morillo)

The information contained in this article is not a substitute for legal advice or counsel and has been pulled from multiple sources.

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