NLRB Establishes New Work Rule Standard: Time to Revise Handbooks and Policies

On August 2, 2023, the National Labor Relations Board (NLRB or “Board”) published an opinion regarding employer work rules. That opinion in the Stericycle and Teamsters Local 628 matter clarified that employer work rules that have a reasonable tendency to chill employee rights will now carry a presumption of unlawfulness.

The Stericycle decision marks a departure from the employer-friendly Boeing standard (and related cases), which we reported on in 2018 and 2020.

Presumption of Unlawfulness When There is a Reasonable Tendency that Employees’ Section 7 Rights Will Be Chilled

At the outset, the Board stated that the Boeing and LA Specialty Produce standards permit employers to “adopt overbroad work rules that chill employees’ exercise of their rights under Section 7 of the [National Labor Relations] Act” and rejected both. The new framework requires the Board’s general counsel to prove only that the work rule “has a reasonable tendency” to chill employees’ Section 7 rights. If proven, a presumption of unlawfulness is established.

An employer can only overcome the presumption by proving the rule advances a legitimate and substantial business interest — and a more narrowly tailored rule would not advance that interest.

The Stericycle opinion also repeatedly stated that the Board will interpret workplace rules from the perspective of an employee who is economically dependent on the employer, further evidencing the shift away from an employer-friendly standard.

Retroactive Application

The Board clarified that the new standard will be applied retroactively, specifically stating that previous rules that would have been upheld under Boeing and are now unlawful may require recission and re-drafting.

Going Forward — Handbook/Policy Revision

Companies should evaluate their work rules in light of this new standard from the Board.

Policies that address the following scenarios, in particular, should be carefully reviewed and evaluated to ensure compliance with the employee-friendly Stericycle standard:

• Investigation Confidentiality
  • The Board specifically addressed whether confidentiality rules during an ongoing investigation are lawful. The Board majority stated there should be no presumption that these rules are lawful, and instead the specific wording must be evaluated.
• Non-Disparagement
• Outside Employment
• Civility Rules
• Prohibition of Media Communications
• Social Media

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