Tag: employee handbook

Employee Handbook

Who Needs an Employee Handbook?

Every business with employees should consider whether and when to implement an employee handbook. Some companies will put a handbook in place even before they hire their first employee. Others will wait until they have an established workforce. So, what is the right time? Do you need an employee handbook now?

Let me be honest up front. I’ve been advising employers on employment law for more than 12 years. And during that time I’ve had mixed feelings about employee handbooks. Sure, it’s nice to have the policies and other information compiled as a resource for employees. However, written policies sometimes tie employers’ hands, limiting flexibility in dealing with employee situations. On the whole, I’m not ready to suggest throwing out the employee handbook. Instead, I suggest having a good handbook that’s carefully tailored to the specific organization.

What Is an Employee Handbook?

Sometimes they go by other names: employee manuals, policy manuals, etc. But I’m talking about some compilation of rules, policies, procedures, and guidelines that the organization prepares and provides to all employees. (As opposed to ad hoc policies or manuals that only go to management or human resources for administrative purposes.)

Most employee handbooks (should) include these general elements:

  • Welcome/Introduction
  • At-Will Employment statement
  • Disclaimer of Company Rights
  • Equal Employment/Anti-Harassment policies
  • Attendance and Leave policies and procedures
  • Timekeeping and Payroll information
  • Employee Benefits summaries
  • Other workplace rules
  • Acknowledgment of Receipt

This is neither an exhaustive nor detailed list. Many elements above may encompass multiple issues spreading across several handbook sections. But this is a good starting point in considering what an employee handbook would look like if your business doesn’t already have one.

Employee handbooks can range from several to 100+ pages. The size of the workforce and number of locations (including where they are located) factor into the length and scope of handbooks. Bigger companies tend to have larger employee handbooks. But even organizations with just a few employees may choose to have comprehensive handbooks depending on the nature of the business.

These days it’s also common for employee handbooks to be digital. Some companies maintain dedicated electronic portals where employees can access the policies. Others may just have a .pdf version available on an intranet. Even if employees don’t receive a physical copy of the handbook, they should always be required to acknowledge their receipt upon hiring and whenever major revisions are implemented.

Purposes of an Employee Handbook

Different organizations may have additional goals in mind, but here are the some of the primary reasons for having an employee handbook:

  • Introduce employees to company culture and values
  • Highlight benefits of working there
  • Establish workplace expectations
  • Provide support for employee discipline
  • Defend against claims of “I didn’t know”
  • Include legally mandated notices to employees
  • Direct employees where to go for help

Employee Handbook Pitfalls

The biggest problem with employee handbooks is that organizations don’t always follow them.

Sometimes this is inadvertent. People just don’t bother to check the handbook before doing something.

Other times, it’s intentional: “Yeah, I know what it says, but we’ll make an exception this time.”

It’s not always wrong to deviate from what’s written in the employee handbook. In fact, employers should expressly state in the handbook that the company can modify their policies at any time. But any modifications should be deliberate and upon consideration of the implications.

Inconsistent application of an employee handbook can provide the basis for employment discrimination claims. Suppose the company makes extra allowance to their leave policy for women, but not men. Despite good intentions, this could upset the men, who might even claim sex discrimination. Obviously, this could work in reverse, and inconsistencies may occur regarding other protected characteristics as well.

There can be issues even when companies follow their employee handbooks carefully. Employers sometimes include illegal provisions in the handbook. Usually, these organizations mean no harm. They are just trying to protect their business. But there are many laws out there that create traps for the unwary.

Here are just a few statements that might well run afoul of the law:

  • “Do not discuss your compensation with other employees.”
  • “Employees will not be paid for unauthorized overtime.”
  • “Do not speak to the media about the Company or its business.”
  • “You cannot solicit fellow employees for any purpose while on Company premises.”
  • “Employees will be expected to work through lunch if necessary to complete assigned tasks.”

Unionized Workforces

Before concluding, I note that when a union represents employees in a workplace, the employer must negotiate over terms and conditions of employment. This typically results in a written collective bargaining agreement, or “union contract.” This agreement most often addresses many issues that an employer without a union would normally cover in the employee handbook. Consequently, much of an employee handbook may not apply to the unionized employees in the organization. But a handbook may still be desirable for unrepresented employees, including management.

Do You Need an Employee Handbook?

If you have read this far, have employees, and don’t have an employee handbook, then your business would probably benefit from having one. However, you must be prepared to take it seriously. This means preparing a handbook that specifically reflects your workplace, distributing it to employees and answering resulting questions, and applying it consistently every day.

 

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2017 NLRB Decisions

2017 NLRB Buzzer Beaters

Republicans (temporarily) lost majority control of the National Labor Relations Board when Chairman Philip Miscimarra’s term expired on December 16, 2017. But not before they pulled off some 2017 NLRB fireworks!

Facing a 2-2 party split to begin 2018, Republican Members Marvin Kaplan and William Emanuel joined the outgoing Chairman in issuing pivotal rulings in the last days of his term. Here’s a quick summary of some of the most important 2017 NLRB policy shifts.

New Election Rules?

Not yet. But the road is paved.

On December 13, 2017, the NLRB issued a request for information from the public regarding the agency’s union election procedures. Specifically, the Board asked for information regarding the 2014 amendments to the rules. Those were promulgated by a Democrat-majority Board under President Obama, leading to what many have dubbed “quickie elections.”

The request for information itself does not change anything. However, it does strongly suggest a potential change in course. Once President Trump nominates and the Senate confirms a new Republican member to the NLRB, Members Kaplan, Emanuel, and their new colleague could take further action to revise the election rules. The result would likely be more time between filing of petitions and elections taking place.

Read here for more details on the request for information.

More Reasonable Restrictions on Employee Conduct

Under the previous administration, the NLRB said that employers could not have policies requiring employees to be “respectful”.

That was only illustrative of the extent to which the Obama Board objected to standard employment policies of the types long found in many employers’ employee handbooks.

The Obama NLRB also particularly enjoyed regulating comparatively new “Social Media” policies. Various Democrat-controlled panels routinely struck down policies, or at least portions of them, that seemed to most employers to be perfectly reasonable means of conducting business and avoiding undue attacks on companies from their own employees.

On December 14, 2017, the Miscimarra-chaired Board effectively reversed numerous Obama-era decisions by changing the legal test upon which they were decided.

A 2004 NLRB decision reasoned that even if a rule doesn’t “explicitly restrict” an employee right under the National Labor Relations Act, the rule may still be unlawful if employees would “reasonably construe the language” to restrict activity that the Act protects.

In a case involving Boeing, the 2017 NLRB (with both Democrats dissenting) has now rejected that standard and replaced it with a “balancing” test. Going forward the NLRB will now weigh “the nature and extent of the potential impact on NLRA rights” against “legitimate justifications associated with the rule.” (You can read the full decision here.)

The predictable impact of the new test will be greater protection of employers’ rights to maintain appropriate control over their business.

Relaxing the Joint Employer Doctrine

In 2015, the NLRB, over the objection of Miscimarra and fellow Republican Member Harry I. Johnson III, created a broad standard for determining when separate business entities simultaneously “employ” the same employees. In other words, when two different companies are “joint employers”. The critical question affects various issues under the National Labor Relations Act. These include union representation and liability for unfair labor practices.

In another December 14, 2017, 3-2 Board decision, the NLRB announced it was returning to an earlier test that “reflects a common-sense, practical understanding of the nature of contractual relationships in our modern economy”. The restored test will depend on which business(es) have “direct and immediate” control over terms and conditions of employment. It dismisses analysis of “indirect” factors that the Democrat majority introduced in 2015. (You can read the full decision here.)

Among other situations, this change in the joint employer doctrine will significantly affect franchised businesses. There are, for example, many NLRB cases contesting whether McDonald’s Corporation is a joint employer of its independent franchisees’ employees.

Eliminating Micro-Units

In 2011, the NLRB issued a ruling in Specialty-Healthcare that has permitted unions to organize smaller subsets of an employers’ workforce. Essentially, the Obama Board would accept most any bargaining unit containing employees who share some “community of interest”. The employer had the burden of proving that additional employees share an “overwhelming community of interest” in order to enlarge the scope of a proposed bargaining unit.

The new line of cases beginning in 2011 benefited unions seeking to organize, because they did not need to win the support of as many employees within a workplace. Indeed, they had greater latitude to pursue bargaining units that happened to coincide with employees who favored union representation. Pockets of co-workers who opposed the union could be ignored.

On December 15, 2017, however, the Miscimarra-led Republican majority reinstated the NLRB’s traditional community of interest standard in determining what bargaining units are appropriate. Under this restored test, the Board will evaluate “whether the employees in a petitioned-for group share a community of interest sufficiently distinct from the interests of employees excluded from the petitioned-for group to warrant a finding that the proposed group constitutes a separate appropriate unit.” (You can read the full decision here.)

2017 NLRB Makes Way for 2018

President Trump will have the opportunity to appoint his third NLRB member by the beginning of his second year in office. That is somewhat remarkable considering that Board members hold 5-year terms.

There’s no obvious reason to doubt that the newest Board member will agree with these 2017 NLRB reversals. He will likely join Members Kaplan and Emmanuel in reversing other Obama-era decisions, giving employers more latitude to manage their workplaces.

Confidential Information

NLRB Allows Employers To Protect Certain Confidential Information

In recent years, the National Labor Relations Board has rejected many employer policies as restricting employees’ rights. This has included decisions related to protection of confidential information.

On August 14, 2017, the NLRB ruled in the employer’s (Macy’s) favor on a rule prohibiting disclosure of confidential information about customers obtained from the company’s confidential records. The Labor Board did not review other rules in the employer’s handbook that an administrative law judge had found to violate the National Labor Relations Act.

Macy’s Confidential Information Policy

Macy’s employee “Code of Conduct” included a lengthy “Confidential Information” policy.

In part, the Confidential Information policy provided:

Confidential information about our Company, its business, associates, customers and business partners should be protected. It can be used only to pursue the Company’s business interests or to comply with the Company’s legal or other obligations.

What is confidential information? It could be business or marketing plans, pricing strategies, financial performance before public disclosure, pending negotiations with business partners, information about employees, documents that show social security numbers or credit card numbers–in short, any information, which if known outside the Company could harm the Company or its business partners, customers or employees or allow someone to benefit from having this information before it is publicly known.

The policy goes on to prescribe rules for protecting confidential information, such as marking documents as confidential and shredding them when no longer needed.

Legal Issues

Section 7 of the National Labor Relations Act protects employees’ rights to engage in concerted activity for their mutual aid and protection. This includes the right of employees to collectively appeal to their employer’s customers in a labor dispute.

Employer rules that unreasonably “chill” employees’ exercise of their Section 7 rights are unlawful.

Two of the three NLRB members deciding this case agreed that Macy’s rules regarding confidential customer information did not violate Section 7. One member, former Chairman Mark Pearce, disagreed.

Notably, both Chairman Philip Miscimarra, a Republican, and Member Lauren McFerran, a Democrat, agreed on the majority decision. This marks an unusual alignment in employee rule decisions from the NLRB.

The majority emphasized the reference to social security and credit card numbers. No one contended that employees had a right to disclose that information. However, Member Pearce disagreed with its relevance in determining the lawfulness of the policy as a whole. He instead emphasized the broader reference to “any information, which if known outside the Company could harm the Company or its business partners.”

But the majority countered that the reference social security and credit card numbers along demonstrated the type of information that Macy’s intended to protect by its policy. They further relied on the inclusion of rules for preserving confidential information. In sum, they concluded that because the rule only protects information that is truly “confidential,” it does not unduly chill employees’ rights under Section 7.

Click here for the NLRB’s decision in Macy’s, Inc. 365 NLRB No. 116 (2017).

The Bigger Picture

This decision is important for many employers who maintain confidentiality policies. But it may be more significant in signaling a shift in Labor Board review of employee rules generally.

As previously discussed, the NLRB has recently added a fourth Member, Republican Marvin Kaplan. This brings the Board to a 2-2 split between Republicans and Democrats. And it will soon feature a 3-2 Republican majority for the first time in nearly a decade.

It was somewhat surprising that Democrats McFerran and Pearce split on their interpretation of Macy’s confidential information rule. This perhaps demonstrates how far Member Pearce’s extreme pro-employee views extend.

More important, Chairman Miscimarra’s footnotes in this decision reflect his disagreement with existing precedents on various employee-rule related issues. Although Chairman Miscimarra himself will be leaving the Board later this year, it is fair to assume the incoming Republican members will largely share his views. This will eventually lead to NLRB decisions that are less burdensome for employers.

Stay Tuned for More Labor Board Developments

NLRB decisions affect most private-sector employers in the United States. This includes both union and non-union workplaces. New decisions from a Republican-led Board may change the ways employers can manage their employees.

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