Not unexpectedly, last week the National Labor Relations Board (NLRB) changed its work rule test. The NLRB’s work rule test assesses whether particular employer policies (rules) illegally restrict workers’ rights. The Biden labor Board, now comprised of his appointees, and its General Counsel stated that since this Administration came into office, it would be reviewing many Trump-era labor rules and this rule in particular.

Previously, the NLRB applied a rule adopted by the Trump-NLRB called the Boeing rule. This rule held where an employer handbook policy (rule) was being challenged as prohibiting a labor right, the NLRB would look at the business purpose (employer’s reason) for having the policy (rule) and balance it against whether the rule could also have a chilling effect the employees’ right to organize or otherwise engage in protected concerted activity. If so the policy (rule) would be held to violate the NLRA. It was a fairly balanced test requiring both sides to show why the rule was fair or unfair.

Till last week the Boeing Rule as it is known looked at employer policies in three categories:

• "Category 1 will include rules that the Board 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."
• "Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications."
• "Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule."

The new test for determination if a policy may curtail NLRA rights is actually a modified version of a previous NLRB ruling with local Southeast Michigan ties. In 2004, the NLRB ruled in Lutheran Heritage -Livonia that a policy (rule) was a violation of the NLRA if an employee could reasonably believe it prevented them from exercising their rights under the NLRA. Under the new Stericycle Inc. ruling, the Board will review a challenged policy and if it could be read as having a “reasonable tendency to chill employee’s rights to act together to “advance their legitimate interests.” If so, it would be seen as a violation of the NLRA. This test relies on how an employee might interpret the policy and not so much on the business reason for the policy.

Phillip Miscimarra, the NLRB Board Chair when the Boeing rule was decided, said that under the Stericycle rule, “The unfortunate outgrowth of that is everybody is going to have to try to do what was so difficult to do before Boeing was decided, which is guess as to what language is good enough and what rules are clear enough to avoid the possibility of having them invalidated after several years of litigation.”

This new test turns on how a worker would view it if they intended to engage in organizing (Sec. 7 NLRA). The rule is a much lower standard and will impact many common employer handbook policies that are written too broadly.

Policies such as:

• Confidentiality
• Recording and picture taking
• Engaging in disruptive behavior such as insubordination, non-cooperation or any on the job conduct that may adversely affect operations
• Social media and blogging (bad-mouthing the employer)
• Cellphone use
• Searching property
• Use of employer logos or intellectual property
• And many other seemingly “neutral” rules deemed addressing issues of acting jointly on issues regarding wages, benefits or terms and conditions of employment

Under the Stericycle ruling, if the policy could reasonably be seen as curtailing this activity it will be considered as a violation of labor law by this NLRB.

Keeping in mind that the NLRA covers union and non-union employers alike, it is recommended employers (again) review their employee handbooks to see if any policies may cross this new standard’s line. Could the policy be understood by a worker to prevent them from exercising a protected right? (Section 7 NLRA). This may even include an employer’s requirement that employees maintain confidentiality around a discrimination or harassment investigation. A pretty standard condition in most employer’s anti-discrimination procedure intended to protect those involved in such a complaint.

One other thing – this ruling and its criteria applies retroactively. That means that rules that just last week were lawful are not anymore.

In today’s era of union organizing If an employer is a target for organizing, their employee handbook will be used by the union to show how unfair the employer is. Any rule deemed to impinge on the employees right to engage in organizing will be used as the basis for bringing an unfair labor practice charge. This is a common practice in organizing to garner support and muddy the organizing waters against the employer.

If an employee is discharged under a rule that could be interpreted as curtailing an employee’s NLRA rights, even if organizing was not the intent of the employee’s wrongful action, the employee may now allege that is how they understood what the rule meant and get a second chance by way of the NLRB.

The current NLRB, under Biden, regards itself as the “most labor friendly Administration in history.” The NRLB is now in its most active phase of changing labor law in favor of unions. 

ASE Connect

In-Person Class: Designing and Updating Employee Handbooks - Participants will receive instruction on on critical legal compliance handbook components and standard and optional policies to include in a handbook. The course will discuss layout tips that will help keep update work to a minimum. This class will be held in Troy on September 6, 2023, 9:00 a.m. - 12:30 p.m. Register here.

ASE Handbook Services - ASE can provide employee handbook review or update. If an organization does not have an employee handbook yet, ASE can develop a complete employee handbook customized to that organization’s policies and practices. If you have a handbook, we can review it for compliance as well as layout for ease of reading. For information about ASE employee handbook review and development services contact Michael Burns.