NLRB Gives Employers More Leeway To Enforce Work Rules That Could Be Construed To Interfere With Section 7 Rights

December 29, 2017Alerts Labor & Employment Alert

The National Labor Relations Board has ruled that an employer does not necessarily violate the National Labor Relations Act by maintaining a facially neutral work rule, policy or handbook provision that could be reasonably construed to interfere with union or other protected concerted activity protected under Section 7.

The 3-2 decision in The Boeing Company, handed down on Dec. 14, overrules Lutheran Heritage Village-Livonia, in which the NLRB declined to consider the employer’s justification for a facially neutral rule or the extent the rule might burden Section 7 activity.

During the Obama administration, the NLRB routinely applied the Lutheran Heritage rule to invalidate facially neutral employer rules adopted and applied for legitimate business reasons unrelated to an employee’s Section 7 activity. Examples of Section 7 activity would include the employees’ right to unionize or discuss wages and working conditions.

Now, in The Boeing Company, the NLRB has added leeway for employers by holding that enforcement of a facially neutral rule will not be deemed unlawful simply because an employee could “reasonably construe” the rule to interfere with Section 7 activity. Rather, the NLRB will apply a balancing test that considers “the nature and potential impact of the rule” on Section 7 activity and the employer’s “legitimate justification” for the rule. The NLRB will evaluate the rule from the perspective of the employee.

Pursuant to this balancing, employer rules will fall into one of three categories.

Category I Rules – those the NLRB concludes are generally lawful to maintain either because (i) the rule “does not prohibit or interfere with the exercise of NLRA [Section 7] rights, or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.” The NLRB provided two examples: a rule requiring employees to engage in “harmonious interactions and relationships necessary to comply with basic standards of civility” (basic civility rules), and the no-camera/photography policy at issue in The Boeing Company. The NLRB noted that an employer could still violate the Act if it applied a lawfully maintained rule in certain circumstances to discipline an employee for engaging in Section 7 conduct.

Category II Rules – those requiring scrutiny by the NLRB on a case-by-case basis to determine whether the rule’s adverse effect on Section 7 rights outweighs the employer’s legitimate justification for the rule. The NLRB declined to provide an example of such a rule. Perhaps a no-pins/buttons rule would fall into this category.

Category III Rules – those the NLRB generally finds unlawful to maintain because the rule predictably has an adverse impact on Section 7 rights that outweighs any employer justification for the rule. Category III rules include those that prohibit employees from discussing their wages or benefits with one another.

The NLRB will determine which category other types of rules fall into through future adjudication. Factors the NLRB might consider in making this evaluation include:

  • whether the Section 7 activity potentially affected by a rule is more central or peripheral to the Act;
  • whether the risk of the rule intruding on Section 7 rights is comparatively slight;
  • whether the rule has a direct/immediate relevance to the employees or the business;
  • whether the rule has an obvious impact on Section 7 activity; and
  • whether there is evidence showing the rule’s effect on Section 7 activity.

The NLRB noted it might draw distinctions on the lawfulness of a rule depending on industry and work setting.

Applying its new test, the NLRB concluded that Boeing’s facially neutral policy that restricts the use of camera-enabled devices on Boeing property was a lawful Category I rule. The NLRB noted that although the no-camera rule might in some circumstances potentially effect employees’ exercise of their Section 7 rights, this adverse impact was comparatively slight since the vast majority of pictures or images blocked would be unrelated to any protected activity.

Moreover, the NLRB concluded that the potential adverse impact on Section 7 activity was outweighed by Boeing’s business justifications for the no-camera rule. According to the NLRB, Boeing’s justification was especially compelling because the rule is necessary to maintain accreditation to perform classified work for the federal government, to comply with Boeing’s duty to prevent the disclosure of export-controlled materials to unauthorized persons, to protect proprietary information and to minimize the risk that personally identifiable employee information would be released. The NLRB said that it would likely find no-camera/photography rules lawful under category I even with less compelling business justifications.

Key Takeaways

Employers are now able to lawfully implement and maintain facially neutral work rules that have the potential to interfere with Section 7 activity so long as the rule has a direct and immediate relationship to the employer’s business and enforcement of the rule is unlikely to have much effect on Section 7 rights. For example, the NLRB noted that only a very small portion of the images Boeing’s no-camera rule would restrict would involve Section 7 protected images. Over time, as the NLRB categorizes additional rules in future decisions, employers should have a better feel for the types of rules the NLRB is likely to find lawful and under what circumstances. For the time being, employers should exercise caution and consider the nature of their rule, the importance of the rule to the employer’s business, whether the rule interferes with an activity that is central to the NLRA, and the likelihood the rule will interfere with Section 7 activity. Even with category I rules (no-camera rules and workplace civility rules), the devil is in the details. One employer’s workplace civility and/or no-camera rule might be lawful while another’s might not, depending on the language of the rule, the justification for the rule and the circumstances in which the rule was implemented.

If you have any questions regarding the decision or about your workplace rules, please contact Daniel Berkley at [email protected], Chip Zuver at [email protected] or another member of Fox Rothschild’s Labor Management Relations Practice.

This publication is intended for general information purposes only. It does not constitute legal advice. The reader should consult with knowledgeable legal counsel to determine how applicable laws apply to specific facts and situations. This publication is based on the most current information at the time it was written. Since it is possible that the laws or other circumstances may have changed since publication, please call us to discuss any action you may be considering as a result of reading this publication.