Does your employee handbook contain a policy prohibiting insubordination or the use of company logos, trademarks or confidential information? If so, your handbook is likely in violation of the National Labor Relations Act (“NLRA”), and this article is written for you––even if you do not have a unionized workforce! The National Labor Relations Board (“NLRB”), which acts to prevent unfair labor practices committed by private sector employers and unions, continues to receive meritorious charges of unlawful handbook rules that precipitated the issuance of a memorandum on the subject. Employers must carefully review the memorandum and their handbooks to ensure their rules and policies are compliant with the NLRA.
On March 18, 2015, NLRB General Counsel Richard F. Griffin, Jr. issued Memorandum GC 15-04, Report of General Counsel Concerning Employer Rules. This 30 page memorandum addresses company policies that are either in direct violation of the NLRA or could be interpreted to be in violation of the NLRA. The focus of the memorandum arises out of Section 8(a)(1) of the NLRA, which prohibits the mere maintenance of a company policy that has a chilling effect on an employee’s Section 7 activity. Section 7 activity is any activity by an employee or group of employees that seeks to improve or discuss their pay and working conditions. The most challenging task for employers is, when drafting employee policies, to ensure the policies cannot be reasonably construed to restrict Section 7’s concerted protected activity. It is not enough that the policies on their face do not violate the NLRA. The NLRB has made it clear that an employer’s lawful intention will not shield the employer from liability: “the law does not allow even well-intentioned rules that would inhibit employees from engaging in activity protected by the Act.”
The General Counsel’s memorandum provides numerous examples of lawful and unlawful policies. For example, an employer’s blanket policy that provides “insubordination is prohibited” violates the NLRA. The NLRB has stated that this policy is overbroad and, thus, can reasonably be inferred to prohibit concerted, protected activity such as discussing wages, hours and working conditions.
The NLRB also found that handbook policies restricting employees’ use of company logos, copyrights or trademarks are unlawful. The NLRB stated that, although copyright holders have a clear interest in protecting their intellectual property, handbook rules cannot prohibit employees’ fair protected use of that property in the course of protected concerted activity. The General Counsel stated, “a company’s name and logo will usually be protected by intellectual property laws, but employees have a right to use the name and logo on picket signs, leaflets, and other protest material. Employer proprietary interests are not implicated by employees’ non-commercial use of a name, logo, or other trademark to identify the employer in the course of Section 7 activity. Thus, a broad ban on such use without any clarification will generally be found unlawfully overbroad.”
The General Counsel recommends employers include clear and specific language with explanatory context so employees will not reasonably construe otherwise lawful policies as limiting their Section 7 activity. For example, a policy that prohibits employees from sharing confidential information could easily be interpreted to prohibit employees from discussing wages or other terms and conditions of employment with fellow employees and with non-employees. To minimize this risk, the General Counsel recommends employers define the term “confidential information” or include it in context that will make the scope clear.
The General Counsel’s memorandum is a good starting point for employers to ensure their policies are lawful––this is particularly true for non-union employers, as their policies have never been the subject of collective bargaining. Unfortunately, however, the 30 page memorandum will likely cause more confusion than clarification, as it is often times inconsistent. Employers should conduct a very conservative review of their policies while comparing them alongside the memorandum. If a policy can, in any way, be interpreted to restrict an employee’s Section 7 rights, the employer should either remove it or rewrite it to remove any ambiguity.
This article is intended to bring the NLRB’s memorandum to the attention of employers. It does not provide an exhaustive analysis of the memorandum. Employers are strongly encouraged to review the memorandum alongside their policies and consult with experienced labor and employment counsel regarding handbooks and other employment policies to ensure the policies will survive the General Counsel Office’s scrutiny.