Tag: Section 7 rights

August 31, 2022

NLRB Increases Scrutiny of Workplace Dress Codes

On August 29, 2022, the National Labor Relations Board (NLRB) found that Tesla’s dress code violated the National Labor Relations Act (NLRA). This decision reversed existing precedent, giving employers less leeway in controlling what their employees wear to work. Now, any workplace dress codes that may be read to restrict wearing union insignia or apparel will be presumed to violate federal labor law. Employers must show special circumstances to justify any such policy.

Section 7 Rights

The NLRB’s analysis of workplace dress codes arises under Section 7 of the NLRA. Section 7 grants employees the rights to “self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.” It also protects employees’ right to refrain from such activities.

Section 7 rights include the prerogative to demonstrate support for a labor union, such as by wearing union insignia on buttons or apparel. However, the right is not absolute and has always been subject to various time, place, and manner restrictions. The scope of those restrictions has fluctuated over the years based on varying views of NLRB members.

Tesla’s Policy

Tesla required production associates manufacturing its electric vehicles to wear assigned company uniforms. The company provided each associate with two pairs of black pants, two black short-sleeve shirts, two black long-sleeve shirts, and a black sweater. The shirts and sweaters bear Tesla’s logo. Supervisors and line inspectors wear red and white shirts, respectively, to distinguish them by job function.

Production associates were allowed to substitute other all-black clothing for the company-issued uniform. However, Tesla’s team-wear policy specified that “[a]alternative clothing must be mutilation free, work appropriate and pose no safety risks (no zippers, yoga pants, hoodies with hood up, etc.).”

Wal-Mart Precedent

In a 2019 decision involving Wal-Mart, the NLRB held that a facially neutral employee appearance policy would be deemed lawful. The burden would then fall to the party challenging dress codes to demonstrate how they unduly restrict employees’ rights to show union support.

The Tesla ruling expressly overrules Wal-Mart. Two NLRB Board members who were in the majority in deciding the Wal-Mart case three years ago dissented in Tesla. The Board majority has shifted to 3-2 control by pro-labor members.

New Standard for Workplace Dress Codes

Under Tesla, the NLRB will find any limitation on employee dress and appearance policies that might limit the display of union insignia to violate the NLRA, unless the employer demonstrates sufficient justification for its policy. Thus, the decision flips the presumption.

There are various situations where the NLRB has permitted limited restrictions on what employees wear. For example, employers may impose restrictions when the display of union insignia “may jeopardize employee safety, damage machinery or products, exacerbate employee dissension, [] unreasonably interfere with a public image the employer has established, or when necessary to maintain decorum and discipline among employees.” But when an employer seeks to uphold their workplace dress code based on any of these rationales, the NLRB will “engage[] in a rigorous, fact-specific inquiry to determine whether the employer actually established the presence of special circumstances in the context of its workplace.”

Employers Beware

Under the new Tesla standard, employers are at risk of having any workplace dress code struck as unlawful. The dissenters hypothesize many scenarios where requiring employees to dress relatively uniformly would not survive the NLRB’s scrutiny. At best, employers would need to rely on exceptions that may or may not be deemed to apply to their situation. Moreover, the NLRB applied its changed standard retroactively to Tesla, demonstrating that any company is at risk of being faulted for relying on an existing exception that the current NLRB majority disagrees with.

In the bigger picture, employers should realize this is just the first significant reversal of NLRB policy by the newly pro-labor Board majority. It is prudent to expect similar rulings beyond the issue of what employees can wear to work. The Wal-Mart ruling followed a 2017 standard for reviewing workplace policies established in a case involving Boeing. The NLRB will likely further erode Boeing‘s relative protection of employers’ rights to control what happens in their workplaces.

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December 18, 2019

Employers Regain Control Over Company Email Use

Say “goodbye” to Purple Communications and “hello” to Rio All-Suites Hotel and Casino. On December 17, 2019, the National Labor Relations Board released a new ruling about employees’ company email use. Specifically, the NLRB reversed a 2014 decision that had granted some employees the right to use their work email account for certain non-work purposes. What does this mean? And how long will it last?

Purple Communications Limited Private Company Property Rights

In December 2014, the NLRB decided a case involving Purple Communications. That decision gave a colorful name to a surprising encroachment on private companies’ control over their email systems.

A divided 3-2 Board for the first time ruled that employees had a federally-protected right to use their company work emails to engage in concerted activity for their mutual aid and protection. That refers to employees’ rights under Section 7 of the National Labor Relations Act. It’s the law that allows employees to join unions. And it also allows them to engage in other forms of joint activities toward improving their work conditions.

Three Democratic NLRB members comprised the Purple Communications majority. The two Republican members dissented.

The majority identified some limitations on their 2014 ruling:

“First, it applies only to employees who have already been granted access to the employer’s email system in the course of their work and does not require employers to provide such access.”
“Second, an employer may justify a total ban on nonwork use of email, including Section 7 use on nonworking time, by demonstrating that special circumstances make the ban necessary to maintain production or discipline. Absent justification for a total ban, the employer may apply uniform and consistently enforced controls over its email system to the extent such controls are necessary to maintain production and discipline.”

Employer Property Interest Overtakes Employee Interests

A 3-1 Republican NLRB majority has reaffirmed that federal law doesn’t entitle employees to use employer-owned equipment for non-work purposes.

The NLRB now holds that employers can restrict employees’ company email use for non-work purposes, including activity otherwise protected by Section 7.

The Board majority observed that “in modern workplaces employees also have access to smartphones, personal email accounts, and social media, which provide additional avenues of communication, including for Section 7–related purposes”. They did, however, allow that there might be an unusual workplace devoid of such alternative means of communication. There, perhaps, Section 7 rights might trump the employer’s property rights. But the majority did not attempt to hypothesize such a scenario.

On the last day of her term, outgoing Democrat Member Lauren McFarren dissented. She contends, “The majority’s decision aims to turn back the clock on the ability of employees to communicate with each other at work . . . .”

A Philosophical Divide

As with many questions under federal labor law, the NLRB’s ruling on this issue reflects a partisan debate. Several other decisions issued around the same day as Rio All-Suites Hotel and Casino demonstrate the same reality. Democrats and Republicans read the National Labor Relations Act differently. As a result, NLRB precedent may only last slightly longer than a Presidential term. Purple Communications, for example, was the law of the land for almost exactly five years.

Should Employers Change Their Policies?

If you had proactively responded to the NLRB’s 2014 pronouncement that employees had a right to use their work email for non-work purposes, then you might have changed or adopted written policies to that end. If so, you could consider revising those policies again. But it’s not a decision to be made automatically.

Employers who, for example, already allow employees to use work emails for a range of personal communications, should be cautious in how they suddenly limit that freedom. If nothing else, a strict contrary policy could anger and alienate employees. In extreme cases, it might even contribute to the type of employee dissatisfaction that contributes to unionization efforts. You probably don’t want that. (Read: Are Unions Bad? 4 Tips for Employers)

And if you do change your company email use policy or practice now, make sure to keep your ears open for the next time Democrats are in the majority on the NLRB.

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June 7, 2018

New Rules for Employee Handbooks

On June 6, 2018, the General Counsel of the National Labor Relations Board issued a guidance memorandum regarding employee handbooks and other work rules. The memo applies a December 2017 NLRB case decision that permitted employers greater flexibility in drafting meaningful workplace policies.

If challenged under the National Labor Relations Act, rules will now fall into one of three categories: lawful rules, unlawful rules, and rules requiring further scrutiny. Many more rules will be deemed lawful than under the previous analysis.

1. Rules that are Generally Lawful to Maintain

The guidance memorandum identifies nine subcategories of rules that will usually not violate the National Labor Relations Act (NLRA). These rules are acceptable “either because the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of rights guaranteed by the Act, or because the potential adverse impact on protected rights is outweighed by the business justifications associated with the rule.”

Civility Rules

Under the Obama Administration, the NLRB routinely found that this type of rule was unlawful. Now they will usually be acceptable because they “are consistent with basic standards of harmony and civility.”

Examples of generally lawful civility rules include:

“Behavior that is rude, condescending or otherwise socially unacceptable is prohibited.”
“Disparaging the company’s employees is prohibited.”
“Employees may not post any statements, photographs, video or audio that reasonably could be viewed as disparaging to employees.”

No-Photography Rules and No-Recording Rules

The NLRB recently allowed a rule prohibiting the use of camera-enabled devices to take images or video at work. The guidance memo suggests that similar rules regarding audio recording should likewise be lawful.

However, the memo cautions that “a ban on mere possession of cell phones at work may be unlawful where the employees’ main method of communication during the work day is by cell phone.”

Rules Against Insubordination, Non-cooperation, or On-the-job Conduct that Adversely Affects Operations

The guidance memorandum acknowledges that nearly all employee handbooks contain these rules. It provides these specific examples:

“Being uncooperative with supervisors or otherwise engaging in conduct that does not support the Employer’s goals and objectives is prohibited.”
“Insubordination to a manager or lack of cooperation with fellow employees or guests is prohibited.”

Rules of this nature will generally be acceptable.

Disruptive Behavior Rules

The guidance memorandum references rules prohibiting:

“Boisterous and other disruptive conduct.”
“Creating a disturbance on Company premises or creating discord with clients or fellow employees.”

In 2016, the NLRB found the first rule above unlawful because employees could read it to prohibit lawful activity such as protests and picketing. However, the current Board will likely allow these rules. The guidance memo offers that “even if employees would read such rules as applying to strikes and walkouts (as opposed to only unprotected conduct), employees would not generally refrain from such activity merely because a rule bans disruptive conduct.”

Rules Protecting Confidential, Proprietary, and Customer Information or Documents

Confidentiality rules in employee handbooks can be problematic if they limit discussion of wage information or working conditions. But the guidance memorandum clarifies that other rules “banning the discussion of confidential, proprietary, or customer information” are now generally acceptable. “Employees do not have a right under the Act to disclose employee information obtained from unauthorized access/use of confidential records, or to remove records from the employer’s premises.”

Rules against Defamation or Misrepresentation

As recently as 2017, the NLRB held that a rule prohibiting employees from “misrepresenting the company’s products or services or its employees” was unlawful. The new guidance memorandum suggests that rule is now acceptable, recognizing that “[t]he vast majority of conduct covered by these rules is unprotected.”

Rules against Using Employer Logos or Intellectual Property

In the past, the NLRB objected to these rules:

“Employees are forbidden from using the Company’s logos for any reason.”
“Do not use any Company logo, trademark, or graphic without prior written approval.”

Now, employers may include similar rules in their employee handbooks. The current NLRB General Counsel accepts that these rules are unlikely to deter employees from “fair use of a logo on a picket sign,” which would likely be allowed under federal copyright and labor laws.

Rules Requiring Authorization to Speak for Company

As long as the rule only addresses who may speak on behalf of the company, it will generally be lawful.

Rules Banning Disloyalty, Nepotism, or Self-Enrichment

The NLRB has historically allowed rules of this nature. Examples include:

“Employees may not engage in conduct that is disloyal, competitive, or damaging to the company such as illegal acts in restraining of trade or employment with another employer.”
“Employees are banned from activities or investments that compete with the Company, interferes with one’s judgment concerning the Company’s best interests, or exploits one’s position with the Company for personal gain.”

2. Rules Warranting Individualized Scrutiny

The NLRB recognizes a gray area for rules that are not obviously lawful or unlawful on their face. Whether an employer may maintain such rules in their employee handbooks or policies manuals will depend on context.

The guidance memo advises that:

[S]uch rules should be viewed as they would by employees who interpret work rules as they apply to the everydayness of their job. Other contextual factors include the placement of the rules among other rules, the kinds of examples provided, and the type and character of the workplace.

These rules will also draw greater scrutiny if employees have actually refrained from lawful activity because of them.

Here are some rules that may fall into this category:

Broad conflict-of-interest rules
Confidentiality rules encompassing “employer business” or “employee information”
Rules regarding disparagement or criticism of the employer
Restrictions on use of the employer’s name
Rules restricting speaking to the media or third parties
Bans on off-duty conduct that might harm the employer
Rules against making false or inaccurate statements

3. Rules that are Unlawful to Maintain

Finally, some rules will still readily violate the NLRA. The following will most likely get employers in trouble.

Confidentiality Rules Specifically Regarding Wages, Benefits, or Working Conditions

The ability to interact with other employees over core terms of employment is a fundamental right under federal labor law. The guidance memorandum offers that “[t]here are no legitimate interests in banning employees from discussing wages or working conditions that are sufficient to overcome Section 7 [of the NLRA] rights.”

Rules Against Joining Outside Organizations or Voting on Matters Concerning Employer

Similarly, the NLRA plainly gives employees the right to join unions. So, employers cannot directly purport to curtail that right through a workplace rule.

Revising Employee Handbooks

This NLRB guidance and the recent case decision give employers greater leeway in drafting their workplace policies. Accordingly, businesses may take this opportunity to review their employee handbooks and consider revisions. But, employers who previously revised policies to comply with earlier, more-stringent NLRB rulings could choose to retain the less-restrictive policies.