Since August 2021, three of the five members of the National Labor Relations Board (“NLRB” or “Board”) have been appointed by Democratic presidents, including two members appointed by President Biden. Earlier this year, the Democratic majority announced in Stericyle, Inc., 371 NLRB No. 48 (Jan. 6, 2022), that it was requesting briefing on whether to overturn one of several employer-friendly decisions issued by the NLRB during the Trump administration: The Boeing Co., 365 NLRB No. 154 (Dec. 14, 2017). In Boeing, the Board adopted a new approach for assessing whether facially neutral employer policies (e.g., generally applicable employee conduct policies) unlawfully interfere with employees’ right to engage in “concerted activities for . . . mutual aid or protection” under Section 7 of the National Labor Relations Act (“NLRA”), even if they do not expressly mention such rights. 365 NLRB No. 154, slip op. at 23 (internal quotation marks and citation omitted).
In a brief filed earlier this week, NLRB General Counsel Jennifer Abruzzo officially joined the fray. Not surprisingly, the General Counsel formally asked the NLRB to overrule Boeing and return to a more employee-friendly standard of review. Below, we provide some background about Boeing and summarize the General Counsel’s position.
In the period immediately preceding Boeing, the Board’s approach to assessing the lawfulness of neutral employer policies was to ask whether employees would “reasonably construe” the policy language as limiting their Section 7 rights. Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004). Employer groups criticized the Lutheran Heritage standard on several grounds, including that it gave employers little guidance about when their policies might violate the law and that it produced a tidal wave of litigation before the NLRB about the vagaries of employer policies. As one Republican-appointed Board member cheekily remarked, Lutheran Heritage turned the NLRB into “the federal employee-handbook police.” Stericyle, 371 NLRB No. 48, slip op. at 3 (Members Kaplan and Ring, dissenting).
Boeing sought to simplify the Lutheran Heritage standard in two principal respects that were beneficial to employers. First, Boeing directed that in assessing the lawfulness of employer policies, the Board would balance the nature and extent of the policy’s effect on Section 7 rights against the employer’s legitimate justifications for adopting the policy. Second, Boeing adopted a three-part rubric that sought to clarify what kinds of employers would and would not run afoul of the NLRA. Per the Board:
“Category 1 will include rules that the Board designates as lawful to maintain, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule. * * *
“Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule, when reasonably interpreted, would prohibit or interfere with the exercise of NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.
“Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule. An example would be a rule that prohibits employees from discussing wages or benefits with one another.”
365 NLRB No. 154, slip op. at 15 (emphases in original). Applying Boeing, the Trump Board and the General Counsel subsequently placed a number of common employer policies (for example, employee conduct policies, non-disparagement policies, and media-contact policies) in Category 1, which largely insulated them from the argument that they violated the NLRA.
The General Counsel’s Position
The General Counsel’s attack on Boeing consists of three primary arguments. First, the General Counsel criticized Boeing as being unduly protective of employees’ rights because it failed to recognize the coercive power an employer’s directions to employees might carry and because it was too solicitous of the employer’s asserted justifications for its work rules. Indeed, the General Counsel urged the NLRB to adopt a rule that assumed employees would be inclined to read handbook policies as potentially limiting their Section 7 rights and that would find a policy unlawful if a “reasonable employee” could read it to limit Section 7 rights. Second, the General Counsel sought to rehabilitate Lutheran Heritage as a workable standard, emphasizing that (contrary to its criticism in Boeing) it took into account an employer’s interests in effective personnel policies.
Finally, and surely in response to critics of Lutheran Heritage who argued that employees would not reasonably read restrictions of their Section 7 rights into facially neutral policies, the General Counsel offers a solution: that employers include in their handbooks an NLRB-approved “prophylactic statement of rights, which affirmatively and specifically sets out employee statutory rights and explains that no rule should be interpreted as restricting those rights,” which if included by employers would entitle them to a rebuttable presumption that no reasonable employee could view the various policies as limiting Section 7 rights.
Although the NLRB has now received the General Counsel’s brief and those of numerous other interested parties, we are probably still several months away from a decision about the fate of Boeing and whether Lutheran Heritage will reemerge from the ashes. We will keep you posted.