employee book, NLRB

The NLRB Takes Aim at Employee Handbooks Affecting Employment Law

April 19, 2016

By: James B. Shrimp

employee handbook, NLRBThe National Labor Relations Board (NLRB) and it’s field offices continue to seek to influence the non-unionized, private sector workplace. Last week, an administrative law judge in an NLRB proceeding involving Quicken Loans, and affiliated companies, Fathead and One Reverse Mortgage, ruled that over 20 provisions of an employee handbook, known as the “Big Book,” violated the National Labor Relations Act. Specifically, the judge ruled that these Big Book provisions violated more than 15,000 employees’ rights to engage in concerted activity.

The National Labor Relations Act

The National Labor Relations Act declares as an unfair labor practice any interference, restraint or coercion of employees in the exercise of rights guaranteed under the Act. Relevant to employee handbooks and policies, the Act permits employees to discuss, debate and communicate with each other regarding their workplace terms and conditions of employment. In determining whether a work rule violates the Act, the inquiry is whether the rule would reasonably tend to chill employees in the exercise of rights protected under the Act. Unbeknownst to many employers, these provisions under the Act apply to union and non-union workplaces alike.

The Big Book – Employee Handbook

The Big Book was a typical employee handbook, although perhaps a little longer than most. It contained sections relating to (1) the history of the company and its current management; (2) employee benefits; (3) anti-discrimination policies and safety; (4) protecting the information of clients; and (5) orientation materials. The Big Book was approximately 220 pages.

The NLRB’s General Counsel asserted that 58 provisions in the Big Book violated the Act. The administrative law judge concluded that 24 of the challenged provisions did in fact violate the Act. Below is sampling of the most common employee handbook provisions that do and do not violate the Act.

Big Book Policies that Violated the National Labor Relations Act

Confidentiality Provision - The Big Book contained an introductory statement that provided that the Big Book contained confidential information and that such information could not be disclosed to non-employees. What information was deemed confidential was not defined in the introductory statement. Therefore, the judge concluded that the provision violated the Act because it potentially chilled protected concerted activity.

Provision Discouraging False Complaints – The Big Book contained a common provision in anti-discrimination policies; specifically that disciplinary action may be taken against any individual submitting a report or complaint that the individual knew was false or misleading, or using the complaint procedure for purposes other than a good faith resolution of discrimination/harassment. The judge ruled that the provision violated the Act, because only “maliciously false” statements can be prohibited under the Act.

Confidentiality of Discrimination/Harassment Complaint and Proceedings – The Big Book contained another common provision in anti-discrimination policies; specifically, that complaints of discrimination/harassment and details of the investigation should be kept confidential by the employees. The judge ruled that “a blanket prohibition on employees discussing all discrimination or harassment complaints is unlawful, absent specific justification.”

Social Media Policies – The Big Book contained a comprehensive social media policy providing “helpful tips and suggestions for using social media to your advantage.” There were seven provisions in the social media policy and the judge found that five of them violated the Act.

The policy advised employees not to put anything online that “doesn’t belong on the front page of The New York Times.” The judge ruled that since the provision instructed employees what not to put online, it violated the Act.

The policy conveyed an “expectation” that whenever employees identify themselves as an employee “in a public way, they are to represent themselves in a professional manner in both dress and conduct.” The judge ruled that since this went beyond conduct with clients, it violated the Act.

The policy advised employees not to “take … online something wrong” at the employer. The judge ruled that this provision violated the Act by prohibiting concerted speech.

Policy on Display of Personal Items – The Big Book contained a policy that prohibited the display of mementos or personal items that “are, or could be deemed to be, harmful or offensive to a reasonable person and his or her system of beliefs.” The judge ruled that this policy was overbroad because, under the policy, the display of pro-union materials could offend a reasonable person. The policy therefore violated the Act.

Non-Solicitation Policy – The Big Book contained a no solicitation policy, prohibiting “unauthorized posting and distribution of solicitation literature … on the Company’s premises.” The judge found that this policy violated the Act, in part, because it prevented solicitation on the employer’s premises during non-working time.

Email Policy – The Big Book contained a policy relating to the proper use of the employer’s phone and email systems. For the most part the judge ruled this policy did not violate the Act. However, the judge ruled that a policy prohibiting an employee from “sending or posting hostile or insulting messages about other managers or employees” violated the Act, because it would tend to limit protected concerted activity. Moreover, the judge ruled that a policy limiting the use of email to only employer related business violated the Act.

Big Book Policies that Do Not Violate the Act

Harassment Complaint Procedure – The Big Book contained a requirement that if the employee was considering resigning because of discrimination, the employee needed to directly report the discrimination to a team leader and not use general suggestion blogs or surveys. The judge rejected the NLRB’s argument that this chilled concerted activity, instead ruling that this was a legitimate policy, encouraging an employee to directly report discrimination/harassment.

Disclosure of Close Personal Relationships – The Big Book contained a requirement that if a superior had a close personal relationship with another employee that it be disclosed. The NLRB general counsel argued that this might cover a “union-related” close personal relationship. The judge disagreed and found the policy did not violate the Act.

Conflict of Interest Policy – The Big Book contained a conflict of interest policy that prohibited employees from engaging in activity in the financial industry that would create an actual conflict or an appearance of a conflict. The judge ruled that this policy did not violate the Act because it sufficiently defined the conflicts it meant to prevent.

Itemization of Prohibited Conduct – The Big Book contained a list of prohibited conduct that is common in most employee policies and procedures. The judge ruled that the list of prohibited conduct was generally permissible.

The Take Away

The NLRB and its field offices continue to expand the reach of the National Labor Relations Act and remain focused on employer policies and procedures in non-union workplaces. The decision of the administrative law judge in the Quicken Loans case is not yet binding on employers, but the decision should be minded. A review of employee handbooks and other policies and procedures is in order.

For more information, feel free to contact James B. Shrimp via email jshrimp@highswartz.com

The information above is general: we recommend that you consult an attorney regarding your specific circumstances. The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

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