The United States Court of Appeals for the District of Columbia Circuit recently held in two decisions that a number of fairly commonplace employee handbook provisions violated the National Labor Relations Act ("NLRA"). Cintas Corporation v. NLRB, 2007 U.S. App. LEXIS 6075 (DC Cir. 2007); Guardsmark, LLC v. NLRB, 475 F.3d 369 (DC Cir. 2007). The policies at issue were found unlawful even though they contained neutral language and were never intended or enforced to prohibit employees from engaging in protected labor activities. Employers should review their employee handbooks and other personnel policies in light of these decisions to ensure they are drafted in a manner that does not unlawfully restrict or interfere with employee rights under the NLRA.
The handbook provisions at issue addressed the areas of confidentiality, grievance procedures, solicitation, and fraternization. According to the DC Circuit Court, the employers in the above cases drafted all four of these provisions in an overbroad fashion. As a result, the provisions were found to interfere with the employees' right under the NLRA to communicate among themselves and with others about the terms and conditions of their employment.
Section 7 of the NLRA guarantees employees 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." 29 U.S.C. § 157 (Emphasis added.) This statute has been interpreted to encompass an employee's right to discuss the terms and conditions of employment with employees and non-employees alike. Section 8(a)(1) of the NLRA makes it an unfair labor practice for employers "to interfere with, restrain, or coerce employees in the exercise [of their Section 7 rights]."
In the Guardsmark case, the employer's handbook contained a "chain of command" policy, or internal grievance procedure, which instructed employees "not to register complaints with any representative of the client." The handbook also contained rules that prohibited solicitation "at all times while on duty or in uniform," and "fraternization" with other employees. The DC Circuit Court ruled that each of these policies violated the NLRA because an employee could reasonably interpret the policies as prohibiting protected labor-related activities such as soliciting client support while off duty (and with any uniform insignia covered) or discussing terms and conditions of employment with other employees or the union. Thus, the court upheld an order of the National Labor Relations Board requiring the employer to amend its handbook and post a notice in all of its offices nationwide that its policies violated the NLRA.
The court reached a similar conclusion in Cintas with respect to a confidentiality policy that stated employees should "recognize and protect the confidentiality of any information concerning the company, its business plans, its partners [employees], new business efforts, customers, accounting and financial matters." The court reasoned that this policy, like the policies in Guardsmark, could be reasonably construed to prohibit Section 7 activity, such as discussing terms and conditions of employment with one another or with union representatives.
In each of these cases, the DC Circuit Court found the policies at issue violated the NLRA even though the policies did not expressly prohibit union activity, apparently had never been interpreted to prohibit union activity, and had never been relied upon by the employer to prohibit or interfere with union activity. It was enough, according the court, that employees "would [or could] reasonably construe the language to prohibit Section 7 [protected] activity."
How The Guardsmark and Cintas Decisions Impact Employers
It is not uncommon for unions to challenge a company's personnel policies as unlawful in order to obtain strategic advantage during organizing drives, or to increase their leverage in collective bargaining. Yet even employers without a unionized workforce or any organizing activity may be subject to unfair labor practice charges for maintaining and/or enforcing overbroad personnel policies. Employers found liable on such charges may be required to revise or withdraw their policies, and post notices of the violations in their facilities. If an employee suffers adverse personnel action (e.g., suspension or termination) based on enforcement of a policy found unlawful, the employee may be eligible for back pay and reinstatement.
The Guardsmark and Cintas decisions illustrate that even neutral and well-intentioned personnel policies may run afoul of the NLRA if not drafted with care. Conduct regulated by such policies should be described using clear and specific language to further the employer's legitimate business objectives. The policies should, to the extent possible, omit vague or broad terms that may be interpreted as restricting employees' Section 7 rights. Employers may also consider including disclaimers or "savings clauses" to exclude protected labor activities from the scope of policy restrictions.
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