After four years under a republican administration, the National Labor Relations Board (NLRB) is now shifting back to the priorities of the Obama Administration.  Unionization is favored, and the NLRB will be pushing the envelope to expand the traditional boundaries of the NLRB.  NLRB General Counsel, Jennifer A. Abruzzo, has issued her first memo—Mandatory Submissions to Advice Memorandum (GC 21-04), which lays out a clear agenda as to the priorities of the Office of the General Counsel. 

For example, Abruzo wants to overturn the Boeing case (The Boeing Co., 365 NLRB No. 154 (2017)), which created a new framework for determining the legality of workplace/employee handbook rules.   Under Boeing standard, the Board changed the focus from whether employees would “reasonably construe” a rule to restrict rights under the Act to determine if the rule is unlawful to whether when reasonably interpreted would potentially interfere with the exercise of employee rights, the Board will evaluate: (i) the nature and extent of the potential impact on those rights; and (ii) legitimate justifications associated with the rule.  When legitimate justifications outweigh a rule’s potential impact on protected rights, it will be found lawful. 

In the Boeing case, Boeing had a rule that restricted the use of camera-enabled devices, such as cell phones, on its property without a valid business need.  The rule did not explicitly restrict any activity protected by the Act; it was not adopted in response to protected activities; and it was not applied to restrict such activities. The rule was justified by the need to maintain confidentiality of the work performed at its facilities, some of which is classified. 

Initially, the rule was found invalid under the Lutheran Heritage Village-Livonia standard by an administrative law judge (ALJ), who stated that a workplace rule that did not explicitly restrict employee rights would nonetheless be found invalid if employees would reasonably construe it that way. The Board overturned the ALJ stating that failing to consider the legitimate justifications associated with employer rules prevents the Board from balancing their impact on employee rights and conflicts with U.S. Supreme Court rulings and the Board’s own precedents. 

In that case, NLRB wanted to provide clarity and predictability for workforce rules and delineated three categories into which rules will be placed in future cases, based on whether its balancing test demonstrates they are: (i) lawful; (ii) unlawful; or (iii) subject to individualized scrutiny on a case-by-case basis.  These are defined as follows:

Lawful includes rules that the Board designates as lawful because they do not restrict rights under the Act, or because the justifications for the rule outweigh their tendency to restrict such rights;

Unlawful includes rules that the Board designates as unlawful because they would restrict rights protected by the Act in a way that outweighs any justifications associated with them; and

Subject to further scrutiny includes rules that warrant individualized consideration of whether they prohibit or interfere with employee rights, and if so, whether the impact is outweighed by other, legitimate considerations.

The Boeing standard will likely be overturned by the new Board and the consistency of expectations will be lost by employers.

Other situations that will likely be overturned include Baylor University Medical Center (2020), which found lawful separation agreements containing confidentiality and non-disparagement provisions, Tobin Center for the Performing Arts (2019) which defined when property owners can deny access to third parties seeking to engage in Section 7 activity, and Rio All-Suites Hotel and Casino which overturned the Purple Communications case, which essentially allowed employees to use the employer’s email system for organizing. Also, respectful workplace training will likely be disallowed bringing back the Quicken Loans case.  Applying Weingarten rights to nonunion employees is also on the bill.

One very important area under review will lead to an attack on independent contractor status and the likely overturning of SuperShuttle DFW, Inc. (2019). The memorandum suggests that the simple act of misclassifying a worker as an independent contractor can be an unfair labor practice (which would overturn the Velox Express case).  With multiple agencies reviewing independent contractor status, this situation can be very muddied and costly for an organization.

Therefore, with compliance the most important issue for most HR teams, it will be good for nonunion employers to get ahead of the game with the activist NLRB.

Source:  Baker Hostetler LLP8/16/21, Seyfarth 8/19/21, Littler 12/18/17