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Many employer handbooks and policies likely should be reviewed and revised following a landmark Aug. 2 ruling by the National Labor Relations Board (NLRB), Stericycle.
“This ruling, in a word, is huge,” said David Pryzbylski, an attorney with Barnes & Thornburg in Indianapolis. “This decision may invalidate countless workplace rules maintained by private-sector employers—whether they are unionized or not. It applies to all companies covered by the National Labor Relations Act [NLRA], which is the vast majority of employers in America.”
The NLRA does not apply to federal or state governmental units, railroads or airlines.
Employers need to create documentary evidence of the justification for their work rules before an unfair labor practice charge is filed, recommended Harry Johnson III, an attorney with Morgan Lewis in Los Angeles and former NLRB member.
In Stericycle, an administrative law judge found that the employer violated the NLRA by maintaining certain rules for its employees that addressed personal conduct, conflicts of interest and confidentiality of harassment complaints. The NLRB announced a new standard for whether work rules violate the NLRA and sent the case back to the judge to consider the ruling in light of the new standard.
Under that standard, if an employee could reasonably interpret the work rule to have a coercive meaning, the NLRB general counsel would have met her burden to prove that the rule has a reasonable tendency to chill employees from exercising their NLRA rights. The general counsel, currently Jennifer Abruzzo, is independent from the board and responsible for the investigation and prosecution of unfair labor practice cases under the NLRA.
The employer’s intent in maintaining a work rule is immaterial, the NLRB wrote. The board instead clarified it will interpret the rule from the perspective of an employee who is subject to the policy, economically dependent on the employer and contemplates engaging in protected concerted activity.
Concerted activity includes talking with one or more co-workers about wages and benefits or other working conditions, circulating a petition asking for better hours, participating in a concerted refusal to work in unsafe conditions, openly talking about pay and benefits, and joining with co-workers to talk directly to the employer, an agency or the media about problems in the workplace, according to the NLRB.
It’s hard to imagine the general counsel won’t be able to prove that a rule has a reasonable tendency to chill employees from exercising their NLRA rights, said Phil Wilson, president and general counsel with the Labor Relations Institute, a labor and employee relations consulting firm in Broken Arrow, Okla.
If the general counsel provides such proof, the rule is presumptively unlawful. However, the employer may counter the presumption by proving that the rule advances a legitimate and substantial business interest and that the employer can’t advance that interest with a more narrowly tailored rule. If the employer proves this, the work rule will be found lawful.
However, “with little actual guidance about the meaning of the phrases above, needless to say, it is an incredibly uphill battle if an employer finds itself trying to rebut the presumption,” said Jason Reisman, an attorney with Blank Rome in Philadelphia.
In addition, the Stericycle opinion discarded previous NLRB decisions holding that certain types of policies were inherently lawful, regardless of the precise language in which the policy is expressed, in favor of evaluation of each challenged policy on a case-by-case basis, said Peter Spanos, an attorney with Taylor English Duma in Atlanta. Policies that are no longer deemed by the board always lawful to maintain are investigative-confidentiality rules, nondisparagement rules and rules prohibiting outside employment.
“Employee handbooks and policies that were adopted or revised based on prior guidance from the NLRB may now be subject to challenge,” he said.
The decision probably will be appealed. The appellate process can take many months or even years, Pryzbylski added. “In the meantime, the board will be enforcing this new standard, so employers face the risk of having their policies invalidated if they do not revisit them to ensure they are drafted in a compliant manner,” he said. “To the extent they are found to have unlawful rules, it could result in backpay awards in the event an employee is terminated pursuant to such a rule, have negative effects on a union election outcome, as well as other penalties.”
Plus, in most cases, the NLRB does not follow a federal appeals court ruling outside of that court’s jurisdiction until the Supreme Court weighs in, if it does. “So, that may favor companies taking a fresh look at their policies sooner rather than later,” Pryzbylski said.
Examples of policies that likely need to be reviewed and rewritten to be aligned with the new board standard, according to Spanos, include work rules:
All HR professionals should work with their labor counsel to audit current employment policies for compliance with the new standard and to keep up-to-date on board decisions that will apply the Stericycle standard in coming months.
The bottom line is that many policies will be under new and intense scrutiny by the NLRB, and employers should be aware of the new standard and review and update their policies accordingly.
The recorded presentation of AAG’s 2023 Educational Seminar held on April 11, 2023 is now available for viewing.
Guest Speaker and Attorney Keith Hammond, of Hammond Law Center, focused on changes in employment law that have occurred over the past year including a few new regulations that could affect your business which will go into effect this summer as well as non-competes and changes from the DOL, NLRB, and OSHA.
This seminar is also approved for 2 Professional Development Credits (PDCs) with SHRM for all attendees.
The recorded presentation of AAG’s 2022 Education Seminar held on April 7, 2022 is now available for viewing.
Guest Speaker and Attorney Keith Hammond, of Hammond Law Center, focuses on changes in employment law that have occurred over the past year. Some of the topics addressed include new regulations under the Biden administration, as well as how the new DOL Secretary Marty Walsh and Democratic controlled NLRB could impact your business.
This seminar is also approved for 2 Professional Development Credits (PDCs) with SHRM for all attendees.
I understand that your first thought may be that this article has nothing to do with your business and you can skip it.
Please read before you disregard. Your employees will soon receive a union message! You have a short amount of time to decide if that message comes from your organization or if you will wait and your employees will learn all they need to know about unions from the Federal Task Force, whose very existence is to encourage unionizing.
I understand the desire to avoid the topic of unions as in my thirty years of working as an Employer Advocate, I’ve skimmed over union articles, and barely skimmed at that. Unions have never been a real issue for most Florida employers, unless you are Disney or a public service entity/municipality. Yes, we must work within the regulations and rules around Section 7 rights (protected concerted activity) of the National Labor Relations Act, but unions have never been a concern. Nationally, there has been a steady decline in union activity as the rights of employees have continued to expand. What is the threat now? Why does it matter to you?
Biden vowed to be “the most pro-union president you’ve ever seen” and he appears to be living up to that promise. His first order of business, day one in office, was to fire (and replace) the sitting General Counsel of the NLRB, even though his term was set to expire November 2021. This is the first time in history a President has fired the sitting General Counsel!
Biden nominated Marty Walsh to be our Secretary of Labor. Mr. Walsh has been confirmed by the Senate and is now the first union member in nearly 50 years to run the Department of Labor.
Biden’s most recent act to abide by the union promise was an Executive Order to create a task force to encourage worker organizing and collective bargaining.
VP Harris has been tapped to chair the Federal Task Force. The task force has no more than 180 days from the Executive Order to submit recommendations for actions to promote worker organizing and to increase union density.
Most business owners and HR professionals have no history in dealing with a partial workforce rebellion. This could happen in individual companies or it could be a wider industry movement in a city or region. Again, most of us have no history in dealing with unions or collective bargaining, so where do you start? What are you supposed to do and how?
You may wish to start with training your managers. They typically have the pulse of your employees and will be the first to know if organizing starts and will likely be the ones your employees go to with questions. Mostly importantly, they need to know how to report, monitor and legally respond to employees. A manager saying “They will shut this company down, before allowing a union in” is not an appropriate response and could cause you much bigger legal problems.
Next, you will want to talk with your employees. In our current environment, they need to be communicated with regularly, regardless of union activity. It seems, we have spent most of the past year with social media, news outlets and the government focused on dividing the country and our citizens. We’ve been divided by our race, gender, religion, political party, mask and/or COVID vaccine status, views on Second Amendment rights, sexual preference, or how you identify. The media has provided you with a multitude of options to cause division in your community. Wouldn’t it be nice if employees didn’t have to endure division at their place of employment?
Communicating with employees to remind them that they do not need an intermediary to speak with their manager or the company owner is a must! You want to stress that you have good open communication between managers and employees. Remind employees that you offer competitive wages and benefits. If any of this is not true, now is the time to fix it as it will be good for your company as a whole, even if the taskforce doesn’t target your industry. Union organizers will use any real (or imagined) crack in your company’s framework to convince employees of how much better they would be with a union on their side.
You may also consider modernizing your policies in regard to your position on unions, while stressing your company’s open door policy as well as a no solicitation policy.
Remember your people are the reason your company exists, and they need to be reminded and shown that they are valued and appreciated.
Being proactive now is one of the keys to your success when it comes to preventing a union from walking through your front door.
Let us know if you would like any help with implementing a Union Avoidance management training program. With AAG on your side, we will help to ensure your team is prepared to answer employee questions.Courtesy of Fisher Phillips LLP
2018 has seen quite a few changes in labor and employment law. But with the New Year having just rung in, it’s time to look forward rather than backward. The question on the tip of everyone’s tongue is: what’s next? Here are our predictions for what to expect in 2019 when it comes to workplace law.
Expect More Class Actions
We’re going to start out with the bad news. Because of the potential for a big payout, class and collective actions are a favorite for plaintiffs’ attorneys. You should not expect that to change in 2019.
The California Supreme Court’s decision in Troester v. Starbucks Corporation has opened up even more avenues for potential wage and hour claims in the Golden State, and the trend could hit the rest of the country, too. In July 2018, the California Supreme Court narrowed the scope of the de minimus doctrine under state law and held that employees must be paid for off-the-clock work that regularly lasts several minutes per day. While the California Supreme Court refused to shut the door entirely on the de minimus doctrine, it noted that technological advances should help employers track small bits of time, and that employers can restructure work to avoid off-the-clock time.
Employers outside of California may see plaintiffs’ attorneys attempting to use the same rationale employed by the California Supreme Court to argue that the de minimus doctrine should not apply in the circumstances of their case. Moreover, with more employees having remote access to emails and other mobile platforms, the number of ways for employees to argue that they were working off the clock has increased.
The Ascendance Of Arbitration Agreements
One way for employers to avoid class actions is through arbitration agreements. Last May, the Supreme Court ruled in Epic Systems Corporation v. Lewis that mandatory class action waivers in arbitration agreements are enforceable. As a result, you can expect to see an increase in the number of companies rolling out updated agreements to include class action waiver language. (Note: if you have not had your arbitration agreement reviewed since May when Epic Systems came out, make it your New Year’s Resolution to do so.)
However, while popular with employers, arbitration agreements are decidedly not so with the plaintiffs’ bar. Expect to see plaintiffs’ counsel becoming more creative in challenging arbitration agreements on grounds related to unconscionability.
We may even be starting to see a backlash against arbitration agreements. Most recently, some law students have been pressuring big law firms to do away with them when it comes to their own hires. And last year, the California legislature passed a law banning mandatory employment arbitration agreements for claims arising out of alleged violations of the Fair Employment and Housing Act or California Labor Code. Although the bill was ultimately vetoed by outgoing Governor Jerry Brown, expect to see the fight continue in 2019.
Don’t Look To Congress To Lead The Way
With Democrats controlling the House, and Republicans controlling the Senate and Executive Branch, you can expect that most employment legislation will be dead on arrival. When it comes to innovative legislation impacting the workplace, you should look to the states to lead the way. This is not to say that there won’t be any changes to labor and employment law on the federal level in 2019. However, we expect the most significant changes to be made by agencies (such as the National Labor Relations Board, the Department of Justice, the Equal Employment Opportunity Commission, etc.) rather than Congress.
NLRB Will Narrow The Definition Of Joint Employer
One of those agencies—the NLRB—made noise last year when it published a proposed rule that would alter the definition of joint employment to make it more difficult to hold multiple businesses responsible for alleged labor and employment law violations by staffing companies, franchisees, and other related organizations. Expect to see continued movement and updates on this proposed rule in 2019.
But before getting too excited at any potential changes, you should keep in mind that states may have their own rules regarding joint employment that could differ from what the NLRB comes up with. Any new rules may not affect your organization’s liability under state law.
USDOL Has A Full Plate
Another agency you should keep an eye on is the U.S. Department of Labor (USDOL). Not only is the USDOL considering its own joint employment rule, but the agency has proposed regulations regarding the regular rate of pay and white collar exemptions (also known as the “overtime” rule).
The regular rate of pay is of particular importance to employers because it is used to calculate the overtime rate of non-exempt employees. While we know that changes to the proposed regulations are targeting sections 7(e)(2) and 7(g)(3) of the Fair Labor Standards Act, the USDOL has been rather vague about what the proposed regulations will look like. The USDOL states that they aim to “provide employers more flexibility in the compensation and benefits packages they offer employees” and “lessen litigation regarding the regular rate.”
The regulation relating to the white collar exemption is less opaque. As employers may recall, the minimum salary threshold for white collar exemptions was supposed to increase from $455 per week (or $23,660 annually) to $913 per week (or $47,476 annually), with the amount to be updated every three years. However, right before these changes were scheduled to take effect in December 2016, a federal court blocked their implementation. Under a new administration, we expect that we will see a more modest proposed increase in the white collar exemption in 2019—perhaps in the low $600s per week.
Paid Sick Leave Will Continue To Be On Trend
Although there are no federal laws mandating paid sick leave (yet), you can expect that paid sick and family leave will continue to be a big issues, with states and localities picking up the slack. Right now, 11 states and the District of Columbia require paid sick leave. Additionally, various cities and counties have stepped in where states have not provided for such leave or to give more generous benefits than the state.
You generally should anticipate an expansion of paid sick leave benefits in 2019. The New Jersey Paid Sick Leave Act went into effect October, while Michigan, Washington, and Westchester County (NY) have paid sick leave laws going into effect this year.
While some municipalities in Texas want to get in on this trend, a Texas appeals courtruled the Austin Paid Sick Leave Ordinance violates the state constitution because it preempts the Texas Minimum Wage Act. San Antonio passed its own sick leave ordinance in 2018, but it may only be a matter of time before it, too, is challenged in court.
Privacy Issues Remain Paramount
The EU General Data Protection Regulation (GDPR) went into effect in May 2018, ushering in sweeping reforms for companies that do business in the EU or employ EU residents. The GDPR threatens strict penalties for non-compliance—up to the greater of 20 million Euro or 4 percent of global annual turnover in the prior year. Having been in effect less than a year, it is still not clear how fines will be assessed and what the potential exposure will be for companies that are found to be non-compliant. As 2019 progresses, you can expect to see many investigations that began in 2018 come to a close, and we’ll begin to get a better idea of how regulatory authorities will assess fines for non-compliance—including whether the fearsome 4 percent penalty will be assessed.
Lest you think the major developments in privacy are safely across the ocean in Europe, you can be sure there will be plenty of action closer to home in 2019. The Illinois Supreme Court currently has a case before it over whether a technical violation of the Illinois Biometric Information Act (BIPA) gives standing to sue absent a person suffering a concrete injury. If the court answers in the affirmative, you can expect to see a continued proliferation of BIPA class actions.
Further, California passed the California Consumer Privacy Act (CCPA) in 2018, which goes into effect at the beginning of 2020. While the law is not as comprehensive as the GDPR, California employers will soon need to figure out this year if it applies to them. You should take compliance seriously: the CCPA allows consumers whose rights have been violated under the Act to bring suit for actual damages or statutory penalties (whichever is greater) under a mechanism somewhat akin to a California Labor Code Private Attorneys General Act. You can expect the proliferation of CCPA lawsuits will be on next year’s list of predictions.
The bombs people drop on social media can detonate right away or lurk like hidden land mines. In some cases, someone is terminated from a current job for recent problematic posts. Take comedian Roseanne Barr, for example, whose tweet this spring referring to Valerie Jarrett was deemed racist and deleted immediately, but ABC executives still dropped her from her sitcom.
Or take Kenneth Storey, a University of Tampa visiting assistant professor who lost his job days after his tweet last summer suggested that the Texas victims of Hurricane Harvey were experiencing “instant karma” for voting Republican. Storey deleted his tweet, but not before a screenshot of it had gone viral.
In other instances, individuals lose a job for social media posts they made long before their employment began. That’s what happened to “Guardians of the Galaxy” director James Gunn, who was fired in July after comments he wrote on Twitter several years ago involving pedophilia and rape resurfaced. Even though Gunn said he regretted his words, it wasn’t enough to save his job.
When an employee posts something offensive, HR professionals are often on the front line of protecting the employer’s brand. Hiring managers also may be expected to act as defenders of the company if a candidate’s online posts have the potential to reflect poorly on the organization’s image.
Attorney Eric Meyer, who blogs about workplace issues, tracks news about employees whose offensive social media comments cause them to lose their jobs. He and other experts believe that this type of termination is becoming increasingly common.
“A firefighter, for example, who puts out a racist meme … CEOs, public figures, you name it. The frequency with which I see incidents of people getting fired doesn’t seem to have declined. I don’t see any evidence that it’s getting corrected anytime soon,” says Meyer, a partner at FisherBroyles in Philadelphia.
Adding pressure to HR’s role is the ubiquity of social media and the speed at which comments can erupt into full-blown crises. “Sometimes, it’s not even a 24-hour news cycle anymore—it’s a 15-minute one,” says Betty Lochner, an HR consultant and owner of Cornerstone Coaching and Training in Olympia, Wash. “If you jump in there and get involved in a conversation that would’ve petered out on its own, that isn’t the best response either.”
But doing nothing may not be a viable option when business leaders are subject to intense pressure to terminate an employee who’s behaving badly. Determining how to respond is no easy task. HR professionals and executives must weigh the potential damage to a company’s image and reputation against their desire to foster a supportive workforce that doesn’t micromanage workers’ actions.
Ultimately, business leadership must determine which behaviors cross the line. That evaluation process could begin whenever an employer learns about a potentially problematic post. “There’s not a cutoff or a statute of limitations for information,” says Jeff Polsky, an employment lawyer with Fox Rothschild in San Francisco.
Crossing the Line
The Internet has obscured the boundaries between people’s personal and professional lives, as more workers friend and follow their colleagues. The result is that employees may become privy to details about their co-workers’ off-duty activities, including their political affiliation, religious beliefs, drug use or participation in controversial causes, that otherwise would’ve remained private.
“Social media has opened the door for us to know people’s intimate views on things that are not work-related,” says Joey Kolasinsky, SHRM-SCP, HR manager at Encore Electric Inc. in Denver.
As people conduct more business and socializing online, Facebook and Twitter have become 21st century watercoolers, where workers flock to grouse, joke and vent. “These are conversations that previously would have happened in someone’s home or in a bar or on a soccer field, and it would have gone under the radar,” says attorney John Polson, a partner with Fisher Phillips in Irvine, Calif.
But in today’s hyperconnected culture, an online comment or photo can spread like wildfire from one co-worker to another and then to multitudes of strangers.
In the early days of social media, business leaders thought they could keep tight control over workers’ use of the platforms. Less than a decade ago, many companies introduced policies forbidding workers from making any negative comments online about the employer, says attorney Mark F. Kluger. Some employers even required workers to supply the passwords to their personal social media accounts—a practice that is now illegal in some states.
But starting around 2010, the National Labor Relations Board (NLRB) began fielding complaints from workers who had been disciplined for their online behavior. The NLRB warned employers that their social media policies could not punish workers for discussing wages, working conditions and terms of employment, all of which are considered “protected concerted activity.” That can include complaints about management, low wages and lazy colleagues, and those protections extend to nonunionized workers as well.
In addition, five states—California, Colorado, Louisiana, New York and North Dakota—protect employees from retaliation for engaging in lawful off-duty conduct and political activities, no matter how distasteful their colleagues may consider their affiliations. “If any companies in those states were to terminate an employee because they were a member of the Nazi Party, they might have a problem,” says Kluger, an attorney with Kluger Healey in Florham Park, N.J.
Workers can, however, be axed for engaging in hate speech and making disparaging comments about protected categories of race, religion and gender. They can also be shown the door for disclosing confidential information and trade secrets, defaming competitors or misrepresenting the company. In general, though, a business has great latitude in deciding whether to terminate for online behavior.
“It is entirely case by case,” Lochner says. “A company has to decide: What’s its reach? What’s the damage? There is no black-and-white answer.”
Don’t wait until a crisis erupts to decide which types of off-duty conduct are unacceptable. HR professionals, company leaders and other decision-makers should agree on a list of core company values so that they will know which behaviors violate organizational principles, Lochner says.
Setting A Policy
A social media policy and related training can help employees better understand the importance of demonstrating professionalism online and provide guidance on what types of online conduct may lead to termination. The HR team at ad agency RPA in Santa Monica, Calif., provides its 750 employees with a company policy and training on managing perceptions in the workplace. A recent session covered how offhand online remarks can affect someone’s image and reputation.
When employees misstep, the gaffes are usually due to what Small describes as “a lack of awareness” as opposed to malice. In one case, an employee saw a negative comment a colleague made online about the services of one of their company’s clients. The two employees were Facebook friends, and the content appeared on a personal page. The colleague contacted Small, who met with the person who made the post and explained why it was inappropriate. Mortified, the worker apologized. “We don’t want to kill free speech, but we want to be respectful of the clients we represent,” Small says.
Even a comprehensive social media policy cannot anticipate every instance where it might be applied. “There’s no one-size-fits-all,” Polson says. “You need a policy tailored to your specific business. And you don’t want to be too broad; you don’t have to have a policy for every decision you make.”
An effective and comprehensive social media policy should be included in your employee handbook. The policy should ask employees to:
On January 25, 2013, the U.S. Court of Appeals for the District of Columbia Circuit issued a long-awaited ruling refusing to enforce the National Labor Relations Board’s (NLRB) bargaining order against a petitioning employer. The basis for the court’s decision was the improper appointment of three members of the NLRB (Noel Canning v. NLRB).
The decision was unique in that it was ultimately decided on purely constitutional grounds, holding that President Obama’s attempted recess appointments of three Board Members in January 2012 were constitutionally impermissible.
What does this mean for the NLRB and for cases pending before it? Although the Board Chairman issued a terse press release on late on January 25th, the NLRB should be very concerned about its short term prospects.