In a 3-2 decision in The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017), the National Labor Relations Board (Board) backed away from 13 years of employee-friendly precedent concerning rules, policies and handbooks by overruling Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004), which established the standard for determining whether an employer’s maintenance of a facially neutral policy or work rule violates the National Labor Relations Act (NLRA).
What Did Lutheran Heritage Mean?
Under the overruled test in Lutheran Heritage, if employer policies either expressly or impliedly infringe on protected activity, the Board would find the policies unlawful under the NLRA. Lutheran Heritage provided that implicit infringement could be found by showing one of three factors:
- If “employees would reasonably construe the language to prohibit Section 7 activity”
- If “the rule was promulgated in response to union activity” or
- If “the rule has been applied to restrict the exercise of Section 7 rights”
Based on this test, the Board found various types of common work rules and policies unlawful, including those regulating and/or restricting employee conduct relating to confidentiality, general “workplace civility” toward supervisors or fellow employees, interaction with the media and other third parties, use of company logos, copyrights and trademarks, and photography and recording.
What Was at Issue in Boeing?
In Boeing, the dispute involved a “no-camera” rule that banned workers from using devices to take photos or videos on job sites without permission. In its decision on this rule, the Board retreated from Lutheran Heritage’s “reasonably construe” language after finding multiple defects inherent in that standard. According to the majority of the Board, the test has “substantial limitations” and is a “departure from the type of balancing required by Supreme Court precedent and the Board’s own decisions.” Further, the test has created confusion among employees, employers and unions, and disagreement among Board members.
In Lutheran Heritage’s place, the Board created a new test for examining a facially neutral policy, rule or handbook provision that could potentially interfere with NLRA-protected activity. Now the Board will evaluate two factors: “(i) the nature and extent of the potential impact on NLRA rights, and (ii) legitimate justifications associated with the requirement(s).” In this evaluation, the Board will strike a balance between the employer’s asserted justifications and any “invasion of employee rights in light of the NLRA and its policy.” This new rule applies retroactively to all pending cases.
New Categories of Employment Policies, Rules and Handbook Provisions
As a result of the balancing test, the Board announced that it will create three categories of employment policies, rules and handbook provisions. These categories are not a part of the balancing test; rather, the categories “will represent a classification of results from the Board’s application of the new test.”
In the first category, the Board will include rules it designates as lawful to maintain, “either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.” For example, once impermissible rules requiring “harmonious interactions and relationships” or civility in the workplace are now acceptable and fit within this category. Also included are the no-camera requirement policies that were at issue in Boeing.
In the second category, the Board will include rules that warrant individualized scrutiny in each case to determine whether the rule, when reasonably interpreted, prohibits or interferes with NLRA rights. If so, then the Board will determine whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.
Finally, in the third category, the Board will group rules it designates as unlawful to maintain because the rules prohibit or limit NLRA-protected conduct and the adverse impact on employee rights is not outweighed by justifications associated with the rule. For instance, a rule that prohibits employees from discussing wages or benefits with each other falls under this category.
What Does This Mean for Employers?
This new rule clearly eases the burden on employers that choose to maintain rules, policies and handbooks that may implicate protected concerted activity under the NLRA. Under this new rule, an employer should always assess any impact a policy may have on NLRA-protected activity. If the policy may impact such activity, the employer must next determine if it can point to legitimate justifications for the policy. If it can, the Board will likely determine that the policy complies with the NLRA.
Employers must note, however, that even if maintenance of a handbook policy or rule satisfies the new test, if in application the handbook policy or rule is used to discipline workers engaging in NLRA-protected activity, the Board may determine that such discipline violates the NLRA. For example, if an employer maintains a “courtesy and respect” policy that satisfies the new test, the employer cannot use that policy to punish employees engaging in NLRA-protected activity.