National Labor Relations Board (NLRB) issued it first precedent-shifting decision of the Biden Administration on August 29th. Tesla, Inc. (2021). While there has been a lot of conjecture that this NLRB will make some big pro-labor changes when they get the chance, so far it has been more talk and memos than formal decisions – until now.
In this case the Board ruled that Tesla’s dress code rule requiring employees to wear either a company logoed polo shirt or a black shirt without insignia violated employee’s right to support union organizing. However, the Board took note that Tesla had previously permitted its workers to wear different colored shirts or even shirts with logos unrelated to the employer. Put those two issues together and the NLRB saw anti-union animus in its enforcement of its dress code policy practices.
The NLRB ruling held that only under “special circumstances” could an employer restrict the display of union insignia. In 2019 the previous NLRB held the “special circumstances” exception only applied when an employer completely prohibited union insignia. Walmart Stores, Inc. (2019). This new ruling significantly restricts an employer’s right to set its own dress rules.
This decision was based on the Board following a 1945 U.S. Supreme Court decision (Republic Aviation Corp. v. NLRB) holding that when an employer interferes in any way with employee rights under Section 7 of the National Labor Relations Act the act, it is presumptively illegal unless the employer has some special circumstances such as to maintain production or discipline. Tesla did not meet this standard. Tesla tried to show that the raised metal union insignia worn on worker apparel damaged some cars being worked on and therefore a rule against wearing such insignia had a special purpose of protecting the quality of the product.
The Board held wearing pro union insignia on one’s clothing at work was protected communication supporting the right to union organizing. NLRB Board Chairman Lauren McFerran commenting on the decision said going forward under the Tesla decision, the employer has to meet a heightened burden to justify any rule that would limit that right.
Two NLRB Board members dissented (the GOP appointed members) stating “The result of this holding is that, in effect, no employer may lawfully maintain any dress code unless the employer can demonstrate “special circumstances. Nothing in the [NLRA] suggests that Congress intended to make all employer dress codes presumptively unlawful.”
Employers should review their dress code policies and practices to determine if any restrictions to wearing certain clothing or insignia may be interpreted as restricting labor organizing activity. The Tesla case is in the realm of labor organizing. Pro organizing insignia is not the only type of dress rights workers have. In 2018 the Fifth Circuit Court of Appeals upheld the NLRB’s holding that a fast-food restaurant (In and Out Burger) could not restrict the wearing of “Fight for $15” buttons. The Court in that case found that the wearing of that messaging was protected because it showed solidarity with a movement pressing for protections for low wage workers.
Employers should also keep in mind their rights pertaining to rules against the wearing or showing of political statements on clothes which have been upheld by Courts. In June of this year the First Circuit Court of Appeals (Frith et al v. Whole Foods Market Inc. 2022) held that employer Whole Foods dress code rules prohibiting wearing of Black Lives Matter insignia on their face masks was legal and not discriminatory. Whole Foods’ argued that its dress code prohibiting display of political messaging while at work was facially neutral and did not seek to racially discriminate against black employees.
This Court decision in the Whole Foods case came under Title VII of the 1964 Civil Rights Act as opposed to the NLRB’s decision that came under the National Labor Relations Act.
Broadly, authority to set dress codes belongs to management. However, avoiding trampling on workers’ rights to engage in concerted activity and to promote issues around wages, benefits, and terms and conditions of employment is a growing area of dress code policy and practice employers have to avoid breaking The second dress code principle is to apply the rules consistently. Inconsistent rule application by management has been shown to not only negate enforcement but to also create potentially discriminatory actions when being arbitrarily applied.
Sources: NLRB Office of Public Affairs: Board Rules Workplace Policies Limiting Wearing Union Insignia, including Union Apparel, are Unlawful Absent Special Circumstances. 8/29/22; NLRB Boosts Scrutiny of Union Apparel Bans by Braden Campbell 8/29/22