The National Labor Relations Board (“NLRB”) has yet again issued new standards by which it will judge employers’ workplace rules (such as codes of conduct). The NLRB’s new framework is relevant to companies because it limits their ability to discipline or terminate employees for, what the employer would ordinarily consider, infractions of reasonable workplace rules. Here, we discuss what employers need to know.
On August 2, 2023, the NLRB issued a decision in Stericycle Inc., re-introducing an employee-friendly standard for evaluating workplace rules. Under this new standard, an employer’s workplace rule will be found “presumptively unlawful” if it “chills” employees from engaging in protected conduct under Section 7 of the National Labor Relations Act (“NLRA”). Protected conduct under the NLRA includes “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” as well as the right “to refrain from any or all such activities.” Thus, any work policy or procedure will be reviewed by the NLRB through this new – employee friendly – lens and if the policy does not meet the legal requirements, the policy itself will be deemed void and any employment action taken per the policy may be rescinded by the NLRB, with penalties imposed against an employer.
Prior to this decision, the NLRB had a more balanced approach for determining the lawfulness of workplace policies, taking into consideration employers’ legitimate justification for its policies. Now, the employer’s policy and application of that policy may have to give way to the NLRB’s interest in promoting employee speech and union organization efforts or other “concerted” activity that is not in the context of union organization.
The decision expressly overrules the Board’s previous, more employer friendly decisions. In doing so, it dismisses the categorization approach, instead requiring a case-by-case analysis from the employee’s perspective. The decision is a clear signal that the Board is adopting a more employee-friendly interpretation, with an increased likelihood of challenges to established workplace rules.
As a result of these NLRB changes, employers should:
- Review Workplace Rules: Examine handbooks and policies for any provisions that might interact with Section 7 rights, such as personal conduct policies, non-disparagement provisions, social media policies, and confidentiality rules.
- Tailor Rules Narrowly: The decision imposes a heavy burden on employers to justify their workplace rules. Employers should consider aligning rules closely with specific business needs and articulate the justification clearly in the policies.
- Consult Legal Counsel Before Taking Disciplinary Action: Engage with labor law counsel under attorney-client privilege prior to taking disciplinary action pursuant to workplace rules, to ensure that the action will not violate the new NLRB standards.
- Stay Informed: The NLRB made an explicit statement that Stericycle does not provide detailed guidance. As such, further guidance may come through memorandums or subsequent decisions.
The NLRB’s recent decisions, particularly in Stericycle, signify a clear shift towards a more employee-centric legal framework. Employers must navigate this carefully, seek legal guidance as necessary, and ensure that their policies are crafted with precision and clarity.