Guidance on Handbook Rules Post-Boeing

OFFICE OF THE GENERAL COUNSEL

MEMORANDUM GC 18-04

June 6, 2018

TO:

All Regional Directors, Officers-in-Charge,

and Resident Officers

FROM:

Peter B. Robb, General Counsel /s/

SUBJECT: Guidance on Handbook Rules Post-Boeing

In its decision in The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017), the

Board reassessed its standard for when the mere maintenance of a work rule violates

Section 8(a)(1) of the Act. Overturning the first prong of Lutheran Heritage Village-

Livonia, 343 NLRB 646 (2004), the Board established a new standard that focused on

the balance between the rule’s negative impact on employees’ ability to exercise their

Section 7 rights and the rule’s connection to employers’ right to maintain discipline and

productivity in their workplace. This memorandum contains general guidance for

Regions regarding the placement of various types of rules into the three categories set

out in Boeing, and regarding the Section 7 interests, business justifications, and other

considerations that Regions should take into account in arguing to the Board that

specific Category 2 rules are unlawful.

Regions should note that not only did the Board in Boeing add a balancing test,

but it also significantly altered its jurisprudence on the reasonable interpretation of

handbook rules. Specifically, the Board severely criticized Lutheran Heritage and its

progeny for prohibiting any rule that could be interpreted as covering Section 7 activity,

as opposed to only prohibiting rules that would be so interpreted.1 Regions should now

note that ambiguities in rules are no longer interpreted against the drafter, and

generalized provisions should not be interpreted as banning all activity that could

conceivably be included.2

Regions should also note that the Board in Boeing did not alter well-established

standards regarding certain kinds of rules where the Board has already struck a

balance between employee rights and employer business interests

ules are no longer interpreted against the drafter, and

generalized provisions should not be interpreted as banning all activity that could

conceivably be included.2

Regions should also note that the Board in Boeing did not alter well-established

standards regarding certain kinds of rules where the Board has already struck a

balance between employee rights and employer business interests. For instance, Boeing

did not change the balancing test involved in assessing the legality of no-distribution,

1 Boeing Co., 365 NLRB No. 154, slip op. at 9 n.43 (Dec. 14, 2017).

2 See id., slip op. at 9 & n.43.

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no-solicitation, or no-access rules.3 The decision similarly did not deal with the “special

circumstances” test of apparel rules, although it may apply to aspects of apparel rules

that are alleged to be unlawfully overbroad.4

The Board in Boeing specifically noted that the decision only applied to the mere

maintenance of facially neutral rules. Rules that specifically ban protected concerted

activity, or that are promulgated directly in response to organizing or other protected

concerted activity, remain unlawful. Moreover, the Board held that the application of a

facially neutral rule against employees engaged in protected concerted activity is still

unlawful.5 A neutral handbook rule does not render protected activity unprotected.

Finally, Advice has not yet determined Boeing’s effect on rules regarding

confidentiality of discipline or arbitration, or rules that potentially limit employees’

access to Board processes. Thus, when presented with such rules, Regions should

submit the case to Advice

in protected concerted activity is still

unlawful.5 A neutral handbook rule does not render protected activity unprotected.

Finally, Advice has not yet determined Boeing’s effect on rules regarding

confidentiality of discipline or arbitration, or rules that potentially limit employees’

access to Board processes. Thus, when presented with such rules, Regions should

submit the case to Advice.

Category 1: Rules that are Generally Lawful to Maintain

The types of rules in this category are generally lawful, either because the rule,

when reasonably interpreted, does not prohibit or interfere with the exercise of rights

guaranteed by the Act, or because the potential adverse impact on protected rights is

outweighed by the business justifications associated with the rule.

Charge allegations alleging that rules in this category are facially unlawful

should be dismissed, absent withdrawal. However, Regions should be cautious about

dismissing allegations regarding rules that are not specifically listed here as Category 1

rules. If a Region believes a rule not listed below should fall in this category, the Region

should submit the case to Advice.

3 See Boeing Co., 365 NLRB No. 154, slip op. at 8 (Dec. 14, 2017) (relying on doctrine

regarding those types of rules as support in overturning Lutheran Heritage).

4 See Long Beach Memorial Center, Inc. d/b/a Long Beach Memorial Medical Center

& Miller Children’s and Women’s Hospital Long Beach, 366 NLRB No. 66, slip op. at

1–2 (Apr. 20, 2018) (finding hospital’s restrictions on wearing union pins overbroad

and unlawful without reference to Boeing test).

5 See Boeing Co., 365 NLRB No. 154, slip op. at 16 (Dec. 14, 2017). However, it is

possible that the Board will, in a future case, also change the prong of Lutheran

Heritage that suggested that, once a facially lawful rule has been applied to protected

activity, the rule itself becomes unlawful. See id

rictions on wearing union pins overbroad

and unlawful without reference to Boeing test).

5 See Boeing Co., 365 NLRB No. 154, slip op. at 16 (Dec. 14, 2017). However, it is

possible that the Board will, in a future case, also change the prong of Lutheran

Heritage that suggested that, once a facially lawful rule has been applied to protected

activity, the rule itself becomes unlawful. See id. (noting that application of a facially

lawful rule to protected concerted activity would still be unlawful, but not suggesting

such application would affect the lawfulness of the rule itself).

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In addition, if a Region believes that special circumstances render a normally-

lawful rule under Category 1 to be unlawful, e.g., due to a unique industrial setting, the

history of the rule’s application, or direct evidence of employee chill, the Region should

submit the case to Advice.

Again, the Board made clear in Boeing that merely maintaining a facially lawful

rule does not determine whether the rule was applied lawfully.6 Thus, simply because a

rule falls in Category 1 does not mean an employer may lawfully use the rule to prohibit

protected concerted activity or to discipline employees engaged in protected concerted

activity.

A.

Civility Rules

The Board has placed this type of rule in Category 1. The following examples

were the civility rules at issue in William Beaumont Hospital that were incorporated by

reference in Boeing:

• “Conduct . . . that is inappropriate or detrimental to patient care of [sic] Hospital

operation or that impedes harmonious interactions and relationships will not be

tolerated.”7

• “Behavior that is rude, condescending or otherwise socially unacceptable” is

prohibited.8

• Employees may not make “negative or disparaging comments about the . .

incorporated by

reference in Boeing:

• “Conduct . . . that is inappropriate or detrimental to patient care of [sic] Hospital

operation or that impedes harmonious interactions and relationships will not be

tolerated.”7

• “Behavior that is rude, condescending or otherwise socially unacceptable” is

prohibited.8

• Employees may not make “negative or disparaging comments about the . . .

professional capabilities of an employee or physician to employees, physicians,

patients, or visitors.”9

In addition, the following examples should be considered lawful civility-type

rules:

• “Disparaging . . . the company’s . . . employees” is prohibited.10

6 Id.

7 William Beaumont Hospital, 363 NLRB No. 162, slip op. at 1 (Apr. 13, 2016)

(incorporated by reference in Boeing Co., 365 NLRB No. 154, slip op. at 5 n.15).

8 Id.

9 Id., slip op. at 21–22.

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• Rude, discourteous or unbusinesslike behavior is forbidden.

• Disparaging, or offensive language is prohibited.

• Employees may not post any statements, photographs, video or audio that

reasonably could be viewed as disparaging to employees.

Impact on NLRA Rights: In Boeing the Board found that these types of rules,

when reasonably interpreted, would not prohibit or interfere with the exercise of rights

guaranteed by the Act. Indeed, the vast majority of conduct covered by such a rule,

including name-calling, gossip, and rudeness, does not implicate Section 7 at all

o that

reasonably could be viewed as disparaging to employees.

Impact on NLRA Rights: In Boeing the Board found that these types of rules,

when reasonably interpreted, would not prohibit or interfere with the exercise of rights

guaranteed by the Act. Indeed, the vast majority of conduct covered by such a rule,

including name-calling, gossip, and rudeness, does not implicate Section 7 at all. In

addition, the Board held that even if some rules of this type could potentially interfere

with Section 7 rights, any adverse effect would be comparatively slight since a broad

range of activities protected by the NLRA are consistent with basic standards of

harmony and civility.11 For instance, while protected concerted activity may involve

criticism of fellow employees or supervisors, the requirement that such criticism remain

civil does not unduly burden the core right to criticize. Instead, it burdens the

peripheral Section 7 right of criticizing other employees in a demeaning or

inappropriate manner.

As Chairman Miscimarra noted in his dissent in Cellco Partnership, the reason a

rule against disparaging coworkers should be lawful is that “disparagement” describes

statements that attack the person. To “disparage” means “to describe someone as

unimportant, weak, bad, etc.” or “to lower in rank or reputation,” and its synonyms

include “badmouth,” “belittle,” and “put down.”12 Employees are capable of exercising

their Section 7 rights without resorting to disparagement of their fellow employees;

thus the impact of such a rule on NLRA-rights is comparatively slight.13

10 Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 11–12

(Feb. 23, 2017) (although the Board found this rule unlawful under Lutheran

Heritage, Chairman Miscimarra in dissent argued that under his William Beaumont

test the rule was lawful).

11 Boeing Co., 365 NLRB No. 154, slip op. at 4 n.15 (Dec. 14, 2017).

12 Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 12 (Feb

b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 11–12

(Feb. 23, 2017) (although the Board found this rule unlawful under Lutheran

Heritage, Chairman Miscimarra in dissent argued that under his William Beaumont

test the rule was lawful).

11 Boeing Co., 365 NLRB No. 154, slip op. at 4 n.15 (Dec. 14, 2017).

12 Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 12 (Feb.

23, 2017).

13 Id.

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Legitimate Justifications: The Board has held that this rule type advances

substantial employee and employer interests, including the employer’s legal

responsibility to maintain a workplace free of unlawful harassment, its substantial

interest in preventing violence, and its interest in avoiding unnecessary conflict or a

toxic work environment that could interfere with productivity, patient care (in

hospitals), and other legitimate business goals.14 In addition to healthcare facilities,

industries that rely on close teamwork or that are particularly vulnerable to toxic work

environments may have further legitimate interests in promoting civility. In addition,

nearly every employee would desire and expect his or her employer to foster harmony

and civility in the workplace.

Balance: Given the substantial legitimate interests behind such rules, and the

little, if any, effect on NLRA rights, the Board has placed civility rules in Category 1.

B.

No-Photography Rules and No-Recording Rules

The Board in Boeing placed no-photography rules in Category 1. The specific rule

at issue there was:

• “[U]se of [camera-enabled devices] to capture images or video is prohibited

. . . .”15

No-recording rules should similarly fall in Category 1

if any, effect on NLRA rights, the Board has placed civility rules in Category 1.

B.

No-Photography Rules and No-Recording Rules

The Board in Boeing placed no-photography rules in Category 1. The specific rule

at issue there was:

• “[U]se of [camera-enabled devices] to capture images or video is prohibited

. . . .”15

No-recording rules should similarly fall in Category 1. Such rules include:

• Employees may not “record conversations, phone calls, images or company

meetings with any recording device” without prior approval.16

• Employees may not record telephone or other conversation they have with their

coworker, managers or third parties unless such recordings are approved in

advance.

Impact on NLRA Rights: The Board in Boeing determined that no-photography

rules have little impact on NLRA-protected rights, since photography is not central to

14 Boeing Co., 365 NLRB No. 154, slip op. at 17–19, 19 n.89.

15 Id., slip op. at 5.

16 Whole Foods Market Inc., 363 NLRB No. 87, slip op. at 6–7 (Dec. 24, 2015)

(although the Board found this rule unlawful under Lutheran Heritage, Chairman

Miscimarra in dissent argued that the rule was lawful).

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protected concerted activity.17 However, such rules may occasionally chill employees

from taking pictures of their protected concerted activity, or from taking pictures of

their working conditions as part of a larger protected concerted campaign. No-recording

rules implicate the same logic, but it is also possible that no-recording rules may

promote Section 7 activity by encouraging open discussion and exchange of ideas.18

Legitimate Justifications: Employers have a legitimate and substantial interest

in limiting recording and photography on their property

their working conditions as part of a larger protected concerted campaign. No-recording

rules implicate the same logic, but it is also possible that no-recording rules may

promote Section 7 activity by encouraging open discussion and exchange of ideas.18

Legitimate Justifications: Employers have a legitimate and substantial interest

in limiting recording and photography on their property. This interest may involve

security concerns, protection of property, protection of proprietary, confidential, and

customer information, avoiding legal liability, and maintaining the integrity of

operations.19 Restricting audio recordings can also encourage open communication

among employees.20

Balance: Given the substantial legitimate interests behind such rules, and the

small risk that the rules would interfere with peripheral NLRA-protected activity, the

Board has deemed no-photography rules always lawful. The same analysis applies to

no-recording rules, and thus such rules should be in Category 1.

Note that, although the Board in Boeing addressed rules prohibiting the use of

camera-enabled cell phones to take photographs, it did not address the use or

possession of cellphones for communication purposes. The Division of Advice has

concluded that a ban on mere possession of cell phones at work may be unlawful where

the employees’ main method of communication during the work day is by cell phone.

C.

Rules Against Insubordination, Non-cooperation, or On-the-job

Conduct that Adversely Affects Operations

Almost every employer with a rulebook has a rule forbidding insubordination,

unlawful or improper conduct, uncooperative behavior, refusal to comply with orders or

perform work, or other on-the-job conduct that adversely affects the employer’s

operation. Some examples are:

17 Boeing Co., 365 NLRB No. 154, slip op. at 19.

18 Whole Foods Market Inc., 363 NLRB No. 87, slip op. at 6–7 (Miscimarra dissenting).

19 Boeing Co., 365 NLRB No. 154, slip op. at 17–19

on,

unlawful or improper conduct, uncooperative behavior, refusal to comply with orders or

perform work, or other on-the-job conduct that adversely affects the employer’s

operation. Some examples are:

17 Boeing Co., 365 NLRB No. 154, slip op. at 19.

18 Whole Foods Market Inc., 363 NLRB No. 87, slip op. at 6–7 (Miscimarra dissenting).

19 Boeing Co., 365 NLRB No. 154, slip op. at 17–19.

20 Whole Foods Market Inc., 363 NLRB No. 87, slip op. at 7 (Miscimarra dissenting).

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• “Being uncooperative with supervisors . . . or otherwise engaging in conduct that

does not support the [Employer’s] goals and objectives” is prohibited.21

• “Insubordination to a manager or lack of . . . cooperation with fellow employees or

guests” is prohibited.22

Impact on NLRA Rights: The vast majority of activity covered by these rules is

unprotected, and employees would not usually understand such rules as covering

protected concerted activity. Indeed, even prior to Boeing the Board has always been

careful to note that employees would not, without more, read rules against improper or

unlawful conduct as applying to Section 7 activity.23 Even rules that prohibit employees

from engaging in any conduct that merely “does not support” the employer would not

reasonably be understood by employees to cover Section 7 activity, absent language that

explicitly lists examples of protected concerted activity that is covered.24

Legitimate Justifications: An employer has a legitimate and substantial interest

in preventing insubordination or non-cooperation at work. Furthermore, during

working time an employer has every right to expect employees to perform their work

and follow directives.

Balance: Where insubordination rules lack any reference that would indicate

Section 7 activity is forbidden, the Board should not presume any impact on NLRA

rights

r has a legitimate and substantial interest

in preventing insubordination or non-cooperation at work. Furthermore, during

working time an employer has every right to expect employees to perform their work

and follow directives.

Balance: Where insubordination rules lack any reference that would indicate

Section 7 activity is forbidden, the Board should not presume any impact on NLRA

rights. And, even where there is some ambiguity, it is likely that the employer’s interest

in maintaining discipline and production will outweigh any chilling effect.25

Note, however, that rules that indicate that the employer could consider

protected concerted activity to be a type of unsupportive conduct are in Category 2

below.

21 Lafayette Park Hotel, 326 NLRB 824, 825 (1998), enforced mem., 203 F.3d 52 (D.C.

Cir. 1999).

22 Copper River of Boiling Springs, LLC, 360 NLRB 459, 459 n.3 (2014) (finding this

rule lawful under Lutheran Heritage).

23 See Flamingo Hilton-Laughlin, 330 NLRB 287, 288–89 (1999).

24 See Lafayette Park Hotel, 326 NLRB at 825.

25 See Boeing Co., slip op. at 7 n.30 (Dec. 14, 2017) (citing Lafayette Park Hotel, 326

NLRB at 825) (noting approvingly Member Hurtgen’s concurrence that even where a

rule chills the exercise of Section 7 rights, it can nonetheless be lawful if it is justified

by significant employer interests, like a ban on solicitation during working time).

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7) (citing Lafayette Park Hotel, 326

NLRB at 825) (noting approvingly Member Hurtgen’s concurrence that even where a

rule chills the exercise of Section 7 rights, it can nonetheless be lawful if it is justified

by significant employer interests, like a ban on solicitation during working time).

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D.

Disruptive Behavior Rules

Disruptive behavior rules are also common in employer handbooks. Some

examples of such rules are:

• “Boisterous and other disruptive conduct.”26

• Creating a disturbance on Company premises or creating discord with clients or

fellow employees.

• Disorderly conduct on Hospital premises and/or during working hours for any

reason is strictly prohibited.

Impact on NLRA Rights: The majority of conduct covered by this type of rule is

unprotected roughhousing, dangerous conduct, or bad behavior. Thus, employees often

will not interpret such rules as applying to Section 7 activity.27 On the other hand,

some such rules might, depending on the context, appear to apply to classic core

protected concerted activity such as walk-outs, protests, picketing, strikes, and the

presentation to management of petitions or grievances, since these activities are often

considered disorderly or disruptive. Indeed, such activity is often engaged in because it

is disruptive—in order to draw attention, underline seriousness, or be used as an

economic weapon. Nevertheless, even if employees would read such rules as applying to

strikes and walkouts (as opposed to only unprotected conduct), employees would not

generally refrain from such activity merely because a rule bans disruptive conduct. Rule

or no, in these circumstances employees know that they are discomfiting their employer

and are acting anyway.28

26 Component Bar Products, 364 NLRB No. 140, slip op. at 6 (Nov

mployees would read such rules as applying to

strikes and walkouts (as opposed to only unprotected conduct), employees would not

generally refrain from such activity merely because a rule bans disruptive conduct. Rule

or no, in these circumstances employees know that they are discomfiting their employer

and are acting anyway.28

26 Component Bar Products, 364 NLRB No. 140, slip op. at 6 (Nov. 8, 2016) (although

the Board found this rule unlawful under Lutheran Heritage, Chairman Miscimarra

in dissent argued that under his William Beaumont test the rule was lawful) (citing

Tradesmen International, 338 NLRB 460, 460–61 (2002) (finding lawful rule that

prohibited “disloyal, disruptive, competitive, or damaging” conduct)).

27 See, e.g., First Transit, Inc., 360 NLRB 619, 629 (2014) (finding under Lutheran

Heritage that in context, rule banning “fighting . . . and other disruptive behavior”

would not be read as applying to Section 7 activity).

28 In the classic example of NLRB v. Washington Aluminum Co., 370 U.S. 9 (1962), for

instance, it is exceedingly unlikely the employees would have stopped to consider a

rule against disruptions before walking out, since they knew already that their

employer did not wish them to do so.

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Legitimate Justifications: Rules of this type discourage conduct that would result

in injury to employees and others. Such rules enhance workplace productivity and

safety by preventing fighting, roughhousing, horseplay, tomfoolery, and other

shenanigans. Depending on the workplace, such rules may also address issues created

by yelling, profanity, hostile or angry tones, throwing things, slamming doors, waving

arms or fists, verbal abuse, destruction of property, threats, or outright violence

oyees and others. Such rules enhance workplace productivity and

safety by preventing fighting, roughhousing, horseplay, tomfoolery, and other

shenanigans. Depending on the workplace, such rules may also address issues created

by yelling, profanity, hostile or angry tones, throwing things, slamming doors, waving

arms or fists, verbal abuse, destruction of property, threats, or outright violence.

Balance: This type of rule clearly applies most directly to the employer’s

substantial interests in safety and productivity, and employees would reasonably

understand the rule not to be about protected concerted activity. Moreover, even if

employees did understand rules of this type to apply to protected concerted activity, the

rule likely would not chill employees from engaging in such activity due to the nature of

the activity covered. Accordingly, the legitimate interests advanced by such rules

outweigh the potential adverse impact on Section 7 activity caused by the mere

maintenance of the rule.29

Note that a no-disruption rule may not be applied to discipline employees for a

strike or walkout in some circumstances. Furthermore, no-disruption rules that

explicitly ban walk-outs or strikes are not Category 1 rules.

E.

Rules Protecting Confidential, Proprietary, and Customer

Information or Documents

Certain types of confidentiality rules also belong in Category 1, e.g., rules

banning the discussion of confidential, proprietary, or customer information that make

no mention of employee or wage information:

• “[I]nformation concerning customers . . . shall not be disclosed, directly or

indirectly” or “used in any way.”30

• Do not disclose confidential financial data, or other non-public proprietary

company information. Do not share confidential information regarding business

partners, vendor, or customers.

29 See Component Bar Products, 364 NLRB No. 140, slip op. at 6 (Miscimarra,

dissenting, applying his William Beaumont dissent to a disruption rule)

osed, directly or

indirectly” or “used in any way.”30

• Do not disclose confidential financial data, or other non-public proprietary

company information. Do not share confidential information regarding business

partners, vendor, or customers.

29 See Component Bar Products, 364 NLRB No. 140, slip op. at 6 (Miscimarra,

dissenting, applying his William Beaumont dissent to a disruption rule).

30 Schwan’s Home Service, 364 NLRB No. 20, slip op. at 16 (June 10, 2016) (although

the Board found this rule unlawful under Lutheran Heritage, Chairman Miscimarra

in dissent argued that under his William Beaumont test the rule was lawful).

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• “Divulging Hotel-private information to employees or other individuals” is

prohibited.31

• No unauthorized disclosure of business secrets or other confidential information.

Impact on NLRA Rights: The vast majority of conduct affected by these types of

rules is unrelated to Section 7. Even under Lutheran Heritage, a broad ban on

discussing confidential or proprietary information, or trade or business secrets, was not

thought to affect Section 7 rights unless terms and conditions of employment were

specifically included.32

As for a ban on discussing customer information, the terms of an employer’s

customer relationships are not subject to collective bargaining, and employees would

not generally understand this type of rule as applying to legitimate public relations

campaigns or boycotts.33 Even if employees considered a particular rule of this type to

apply to protected conduct, any impact would only affect peripheral rights

on discussing customer information, the terms of an employer’s

customer relationships are not subject to collective bargaining, and employees would

not generally understand this type of rule as applying to legitimate public relations

campaigns or boycotts.33 Even if employees considered a particular rule of this type to

apply to protected conduct, any impact would only affect peripheral rights. To the

extent employees may sometimes concertedly engage in NLRA-protected activity that

implicates customer information, such as contacting customers about a labor dispute,

such conduct usually only occurs in limited circumstances as part of a broader

campaign, and must accord with Jefferson Standard in order to be protected. Moreover,

even if employees so interpreted a rule, it would be unlikely to cause employees to

refrain from engaging in a boycott or PR campaign entirely. Any effect would be on a

peripheral right to use customer information to better implement or focus such a

campaign.

In addition, employees do not have a right under the Act to disclose employee

information obtained from unauthorized access/use of confidential records, or to remove

records from the employer’s premises.34 Accordingly, where the rule is specifically about

accessing or disclosing confidential employee records or documents (as opposed to

disclosing employee information), the rule will also not affect Section 7 rights.

31 Lafayette Park Hotel, 326 NLRB 824, 824 (1998), enforced mem., 203 F.3d 52 (D.C.

Cir. 1999)

32 See id. at 826; Super K-Mart, 330 NLRB 263, 263 (1999).

33 Schwan’s Home Service, 364 NLRB No. 20, slip op. at 16 (Miscimarra dissenting).

34 See Macy’s, Inc., 365 NLRB No. 116, slip op. at 3 (Aug. 14, 2017); Cellco Partnership

d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 8 n.28, 8–9 (Feb. 23, 2017)

(Miscimarra, dissenting in part and concurring in part).

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ervice, 364 NLRB No. 20, slip op. at 16 (Miscimarra dissenting).

34 See Macy’s, Inc., 365 NLRB No. 116, slip op. at 3 (Aug. 14, 2017); Cellco Partnership

d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 8 n.28, 8–9 (Feb. 23, 2017)

(Miscimarra, dissenting in part and concurring in part).

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Legitimate Justifications: Employers have an obvious need to protect confidential

and proprietary information, as well as customer information. Customer information

may include records of past purchases, which may affect an employer’s decisions

concerning inventory and marketing, among other things. Customers also routinely

provide businesses with their personal information, such as credit card numbers, with

the reasonable expectation that the business will protect that information. Employers

have a compelling interest in prohibiting the disclosure of such information to protect

their business reputation and avoid significant legal liability.35

Balance: Given the substantial legitimate interests behind such rules, and the

little, if any, adverse impact on NLRA-protected activity, these rule types should be in

Category 1.36

F.

Rules against Defamation or Misrepresentation

Rules prohibiting defamation or misrepresentation should be placed in Category

1, notwithstanding that defamation that occurs in the course of Section 7 activity is

legally protected if not engaged in with New York Times37 malice. Examples of such

rules are:

• “[M]isrepresenting the company’s products or services or its employees” is

prohibited.38

• Do not email messages that are defamatory.

Impact on NLRA Rights: Much like civility rules, rules banning defamation will

not likely cause employees to refrain from protected concerted activity. The vast

majority of conduct covered by these rules is unprotected

ice. Examples of such

rules are:

• “[M]isrepresenting the company’s products or services or its employees” is

prohibited.38

• Do not email messages that are defamatory.

Impact on NLRA Rights: Much like civility rules, rules banning defamation will

not likely cause employees to refrain from protected concerted activity. The vast

majority of conduct covered by these rules is unprotected. Even concerted defamatory

speech to improve working conditions can be unprotected if the defamation is

35 See Schwan’s Home Service, 364 NLRB No. 20, slip op. at 16 n.34 (Miscimarra,

dissenting in part) (noting that Target had incurred $162 million in expenses as a

result of a data breach involving customer information).

36 Id.

37 New York Times Co. v. Sullivan, 376 U.S. 254 (1963).

38 Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 10

(although the Board found this rule unlawful under Lutheran Heritage, Chairman

Miscimarra in dissent argued that under his William Beaumont test the rule was

lawful).

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intentional.39 And, notwithstanding the technical legal definition of “defamation,” in

general parlance that term is synonymous with making intentionally false and

disparaging statements. Similarly, “misrepresentation,” while perhaps not necessarily

being malicious, is defined as a false statement “usually with an intent to deceive or be

unfair.”40 Employees will generally understand that these types of rules do not apply to

subjectively honest protected concerted speech

n,” in

general parlance that term is synonymous with making intentionally false and

disparaging statements. Similarly, “misrepresentation,” while perhaps not necessarily

being malicious, is defined as a false statement “usually with an intent to deceive or be

unfair.”40 Employees will generally understand that these types of rules do not apply to

subjectively honest protected concerted speech. As the Board noted in Boeing, employee

rules should not be expected to be perfect, especially where requiring such perfection

negatively affects employees themselves because it prevents employees from knowing

their employer’s conduct rules.41

Even if such a rule affects employee speech, it only affects employees’ peripheral

Section 7 right to engage in unintentional defamation of coworkers or supervisors.

Employees might use a bit more caution when speaking, but these rules would not

generally engender the self-censorship the Supreme Court was concerned about in

Linn.42

Legitimate Justifications: Employers have a significant interest in protecting

themselves, their reputations, and their employees from defamation and slander.

Businesses often live or die off their reputation, and there is a reason that under normal

circumstances a party can recover civil damages for defamation. Promoting honesty

among employees creates a healthy working environment and reduces the chance of a

defamation lawsuit against the company. The justifications for this rule also overlap

with the justifications for civility rules, in that harming coworker reputations can

create a toxic workplace atmosphere.

Balance: While a rule against defamation, slander, or misrepresentation may

technically cover some activity that is protected by the law, the majority of behavior it

covers is unrelated to the NLRA.43 Like civility rules, these types of rules would

39 See Linn v. United Plant Guard Workers of America, Local 114, 383 U.S. 53, 61

coworker reputations can

create a toxic workplace atmosphere.

Balance: While a rule against defamation, slander, or misrepresentation may

technically cover some activity that is protected by the law, the majority of behavior it

covers is unrelated to the NLRA.43 Like civility rules, these types of rules would

39 See Linn v. United Plant Guard Workers of America, Local 114, 383 U.S. 53, 61

(1966).

40 Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 10

(Miscimarra dissenting) (quoting http://merriam-webster.com/dictionary/misrepresent

(last viewed Feb. 24, 2017)).

41 Boeing Co., 365 NLRB No. 154, slip op. at 2 (noting the negative effects of requiring

employers to anticipate and carve out every possible overlap with NLRA coverage).

42 See Linn v. United Plant Guard Workers of America, Local 114, 383 U.S. at 58–63.

43 See id.

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generally not affect core Section 7 rights, and to the extent they do, the chilling effect is

outweighed by legitimate and substantial interests.44 It is thus unreasonable to require

employers to understand and articulate the difference in their rules between malicious

defamation and simple defamation.

G.

Rules against Using Employer Logos or Intellectual Property

Traditional rules prohibiting employee use of employer logos and trademarks also

belong in Category 1. Examples of such rules are:

• Employees are forbidden from using the Company’s logos for any reason.45

• “Do not use any Company logo, trademark, or graphic [without] prior written

approval.”46

Impact on NLRA Rights: Most activity covered by this rule is unprotected,

including use of employer intellectual property for unprotected personal gain or using it

to give the impression one’s activities are condoned by the employer

yees are forbidden from using the Company’s logos for any reason.45

• “Do not use any Company logo, trademark, or graphic [without] prior written

approval.”46

Impact on NLRA Rights: Most activity covered by this rule is unprotected,

including use of employer intellectual property for unprotected personal gain or using it

to give the impression one’s activities are condoned by the employer. Although some

protected concerted activity might fall under such a rule, including fair use of an

employer’s intellectual property on picket signs and leaflets, usually employees will

understand this type of rule as protecting the employer’s intellectual property from

commercial and other non-Section 7 related uses.

Furthermore, even where employees would reasonably interpret such a rule to

apply to fair use of an employer’s logos as part of protected concerted activity, it is

unlikely that the rule would actually cause them to refrain from so using them. The

types of protected concerted activity implicated by these rules are usually fairly

advanced in terms of employee organization, and employees are unlikely to be deterred

from fair use of a logo on a picket sign by a rule in an employee manual.

Finally, even in the event employees did refrain from fair use of an employer’s

logo or intellectual property, such chill would have only a peripheral effect on Section 7

44 See Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 11–12

(Miscimarra, dissenting).

45 Boch Honda, 362 NLRB No. 83, slip op. at 1–2 (Apr. 30, 2015) (finding rule

unlawful under Lutheran Heritage), enforced, 826 F.3d 558 (1st Cir. 2016).

46 Giant Food LLC, Case 05-CA-064793, et al., Advice Memorandum dated Mar. 21,

2012, at 4 (finding that under Lutheran Heritage this rule was unlawfully overbroad).

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83, slip op. at 1–2 (Apr. 30, 2015) (finding rule

unlawful under Lutheran Heritage), enforced, 826 F.3d 558 (1st Cir. 2016).

46 Giant Food LLC, Case 05-CA-064793, et al., Advice Memorandum dated Mar. 21,

2012, at 4 (finding that under Lutheran Heritage this rule was unlawfully overbroad).

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rights. While employees might refrain from using the logo as part of their protected

concerted activity, it would not stop the protected concerted activity itself.

Legitimate Justifications: Employers have a significant interest in protecting

their intellectual property, including logos, trademarks, and service marks. Such

property can be worth millions of dollars and be central to a company’s business model.

Failure to police the use of such property can result in its loss, which can be a crippling

blow to a company. Employers also have an interest in ensuring that employee social

media posts and other publications do not appear to be official via the presence of the

employer’s logo.

Balance: Because rules against the use of logos and intellectual property

generally will not cause employees to refrain from NLRA-protected activity, and even if

they did the employer’s legitimate interests would outweigh the peripheral Section 7

rights at issue, this type of rule should be in Category 1.

H.

Rules Requiring Authorization to Speak for Company

Rules requiring authorization to speak for the company or requiring that only

certain persons speak for the company fall into Category 1. Examples of such rules are:

• The company will respond to media requests for the company’s position only

through the designated spokespersons.

• Employees are not authorized to comment for the Employer.

Impact on NLRA Rights: Where the rule merely regulates who may speak on

behalf of the company, there will normally be no impact on Section 7 rights

the company fall into Category 1. Examples of such rules are:

• The company will respond to media requests for the company’s position only

through the designated spokespersons.

• Employees are not authorized to comment for the Employer.

Impact on NLRA Rights: Where the rule merely regulates who may speak on

behalf of the company, there will normally be no impact on Section 7 rights.

Legitimate Justifications: Employers have a significant interest in ensuring that

only authorized employees speak for the company. Controlling a company’s message in

response to a crisis or other developing events can be vital to weathering the crisis, and

doing so often demands that only a prepared spokesperson or public relations firm

comments for the employer. This is especially true for media companies or other

employers that regularly find themselves in the public eye.

Balance: Absent any impact on Section 7 rights, and in light of the substantial

employer interests at stake, rules of this type should fall in Category 1.

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I.

Rules Banning Disloyalty, Nepotism, or Self-Enrichment

Rules banning these types of conflicts of interest have generally been deemed

lawful, even prior to Boeing:

• Employees may not engage in conduct that is “disloyal . . . competitive, or

damaging to the company” such as “illegal acts in restraint of trade” or

“employment with another employer.”47

• Employees are banned from activities or investments . . . that compete with the

Company, interferes with one’s judgment concerning the Company’s best

interests, or exploits one’s position with the Company for personal gain.

Impact on NLRA Rights: The Board has historically interpreted rules banning

disloyalty and blatant conflicts of interest to not have any meaningful impact on Section

7 rights

yees are banned from activities or investments . . . that compete with the

Company, interferes with one’s judgment concerning the Company’s best

interests, or exploits one’s position with the Company for personal gain.

Impact on NLRA Rights: The Board has historically interpreted rules banning

disloyalty and blatant conflicts of interest to not have any meaningful impact on Section

7 rights.

Legitimate Justifications: Employers have a legitimate and substantial interest

in preventing conflicts of interest such as nepotism, self-dealing, or maintaining a

financial interest in a competitor. Such usurpation of corporate opportunities, pitting

the pecuniary interest of employees against their employer’s, can have a serious

detrimental effect on an employer’s revenue. Conflicts of interest can also undermine a

company’s reputation and integrity, and cause employees to doubt the fairness of

personnel actions. Financial institutions, law offices, and other professional industries

will likely have particularly significant reasons for avoiding these types of conflicts of

interest.

Balance: Since rules banning these types of activity do not meaningfully

implicate Section 7 rights, and are substantially justified by legitimate employer

interests, these types of rules fall in Category 1.

Note that where a conflict of interest rule goes beyond restricting these types of

activities, it will fall in Category 2 or 3, below.

Category 2: Rules Warranting Individualized Scrutiny

Rules in this category are not obviously lawful or unlawful, and must be

evaluated on a case-by-case basis to determine whether the rule would interfere with

rights guaranteed by the NLRA, and if so, whether any adverse impact on those rights

is outweighed by legitimate justifications.

47 Tradesmen International, 338 NLRB 460, 460 (2002).

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nlawful, and must be

evaluated on a case-by-case basis to determine whether the rule would interfere with

rights guaranteed by the NLRA, and if so, whether any adverse impact on those rights

is outweighed by legitimate justifications.

47 Tradesmen International, 338 NLRB 460, 460 (2002).

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Often, the legality of such rules will depend on context. In interpreting the

context of rules, the Board has noted that general or conclusory prohibitions do not have

to be perfect, and do not have to anticipate and catalogue every instance in which

activity covered by the rule might be protected by Section 7.48 Rather, such rules should

be viewed as they would by employees who interpret work rules as they apply to the

everydayness of their job.49 Other contextual factors include the placement of the rule

among other rules, the kinds of examples provided, and the type and character of the

workplace. Finally, the Board in Boeing noted that evidence that a rule has actually

caused employees to refrain from Section 7 activity is a useful interpretive tool.50

Some of the rules in this category clearly would be read to preclude some Section

7 activity, and the key question then is whether the employer’s particular business

interest in having the rule outweighs the impact on Section 7 rights. In considering that

question, the ease with which an employer could tailor the rule to accommodate both its

business interests and employees’ Section 7 rights should be a relevant factor.

In the absence of any Board jurisprudence applying Boeing to a Category 2 rule,

Regions should submit all Category 2 rules to Advice. The submissions may be in the

form of an email, outline, or brief memorandum

nsidering that

question, the ease with which an employer could tailor the rule to accommodate both its

business interests and employees’ Section 7 rights should be a relevant factor.

In the absence of any Board jurisprudence applying Boeing to a Category 2 rule,

Regions should submit all Category 2 rules to Advice. The submissions may be in the

form of an email, outline, or brief memorandum. Regardless of format, the submission

should include the rule at issue and any related rules, the employer’s asserted

justification for the rule, any evidence of the rule actually chilling employee protected

conduct, and pertinent past enforcement of the rule. The submission should also include

any factors raised by the parties or identified by the Region that weigh in favor of either

the rule’s negative impact on protected concerted activity or the employer’s legitimate

business interests furthered by the rule. Finally, the submission should include the

Region’s proposed balancing of the factors and recommended conclusion.

Some possible examples of Category 2 rules are:

• Broad conflict-of-interest rules that do not specifically target fraud and self-

enrichment (see Section 1-I, above) and do not restrict membership in, or

voting for, a union (see Section 3-B, below)

48 See Boeing Co., 365 NLRB No. 154, slip op. at 9, n.41.

49 See Boeing Co., 365 NLRB No. 154, slip op. at 3, n.14 (Kaplan, concurring) (quoting

T-Mobile USA, Inc. v. NLRB, 865 F.3d 265, 271 (5th Cir. 2017)).

50 See id., slip op. at 15.

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r

voting for, a union (see Section 3-B, below)

48 See Boeing Co., 365 NLRB No. 154, slip op. at 9, n.41.

49 See Boeing Co., 365 NLRB No. 154, slip op. at 3, n.14 (Kaplan, concurring) (quoting

T-Mobile USA, Inc. v. NLRB, 865 F.3d 265, 271 (5th Cir. 2017)).

50 See id., slip op. at 15.

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• Confidentiality rules broadly encompassing “employer business” or “employee

information” (as opposed to confidentiality rules regarding customer or

proprietary information, see Section 1-E, above, or confidentiality rules more

specifically directed at employee wages, terms of employment, or working

conditions, see Section 3-A, below)

• Rules regarding disparagement or criticism of the employer (as opposed to

civility rules regarding disparagement of employees, see Section 1-A, above)

• Rules regulating use of the employer’s name (as opposed to rules regulating

use of the employer’s logo/trademark, see Section 1-G, above)

• Rules generally restricting speaking to the media or third parties (as opposed

to rules restricting speaking to the media on the employer’s behalf, see Section

1-H, above)

• Rules banning off-duty conduct that might harm the employer (as opposed to

rules banning insubordinate or disruptive conduct at work, see Sections 1-C

and 1-D, above, or rules specifically banning participation in outside

organizations, see Section 3-B, below)

• Rules against making false or inaccurate statements (as opposed to rules

against making defamatory statements, see Section 1-F, above)

Category 3: Rules that are Unlawful to Maintain

Rules in this category are generally unlawful because they would prohibit or

limit NLRA-protected conduct, and the adverse impact on the rights guaranteed by the

NLRA outweighs any justifications associated with the rule. Regions should issue

complaint on these rules, absent settlement

making defamatory statements, see Section 1-F, above)

Category 3: Rules that are Unlawful to Maintain

Rules in this category are generally unlawful because they would prohibit or

limit NLRA-protected conduct, and the adverse impact on the rights guaranteed by the

NLRA outweighs any justifications associated with the rule. Regions should issue

complaint on these rules, absent settlement. However, if a Region believes that special

circumstances render lawful a rule that normally would fall in Category 3, it should

submit the case to Advice.

A.

Confidentiality Rules Specifically Regarding Wages, Benefits, or

Working Conditions

The Board has placed this type of rule in Category 3.51 The following are

examples of some confidentiality rules that Chairman Miscimarra stated would be

unlawful under his William Beaumont test, and that should be included in Category 3:

51 Boeing Co., 365 NLRB No. 154, slip op. at 15.

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• Employees are prohibited from disclosing “salaries, contents of employment

contracts . . . .”52

• Employees shall not disclose “any information pertaining to the wages,

commissions, performance, or identity of employees of the Employer.”53

In addition, rules that expressly prohibit discussion of working conditions or

other terms of employment should be considered Category 3 rules, for substantially the

same reasons.

• Employees are prohibited from disclosing to “any media source” information

“regarding employment at [Employer], the workings and conditions of

[Employer], or any . . . staff member.”54

Impact on NLRA Rights: Most discussion of wages and benefits will likely be

protected and concerted. Moreover, discussions and coordination between employees,

unions, and others regarding working conditions and wages is a core NLRA right

disclosing to “any media source” information

“regarding employment at [Employer], the workings and conditions of

[Employer], or any . . . staff member.”54

Impact on NLRA Rights: Most discussion of wages and benefits will likely be

protected and concerted. Moreover, discussions and coordination between employees,

unions, and others regarding working conditions and wages is a core NLRA right.

Legitimate Justifications: There are no legitimate interests in banning employees

from discussing wages or working conditions that are sufficient to overcome Section 7

rights.

Balance: This type of rule has a serious adverse impact on the central NLRA

right of employees to contact one another and discuss working conditions and

employment disputes, which is not outweighed by any employer interest, and is thus

always unlawful.55

52 Long Island Association for AIDS Care, Inc., 364 NLRB No. 28, slip op. at 1 n.5

(June 14, 2016) (although the majority found this rule unlawful pursuant to Lutheran

Heritage, Chairman Miscimarra, concurring, would have found it unlawful under his

William Beaumont dissent).

53 Schwan’s Home Service, 364 NLRB No. 20, slip op. at 17 (June 10, 2016)

(Miscimarra concurring).

54 Long Island Association for AIDS Care, Inc., 364 NLRB No. 28, slip op. at 1 n.5.

55 Boeing Co., 365 NLRB No. 154, slip op. at 15.

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nd it unlawful under his

William Beaumont dissent).

53 Schwan’s Home Service, 364 NLRB No. 20, slip op. at 17 (June 10, 2016)

(Miscimarra concurring).

54 Long Island Association for AIDS Care, Inc., 364 NLRB No. 28, slip op. at 1 n.5.

55 Boeing Co., 365 NLRB No. 154, slip op. at 15.

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B.

Rules Against Joining Outside Organizations or Voting on Matters

Concerning Employer

Impact on NLRA Rights: Rules regulating membership in outside organizations

cover some unprotected activity, but also clearly encompass protected activity. A core

aspect of protected concerted activity under the NLRA is that employees may desire to

have “outside organizations,” specifically unions, represent them.56 Where an

employer’s conflict-of-interest policy includes a rule that would be interpreted as

restricting membership or work for a union, it would naturally cause more timid

employees to refrain from such activity.57 Employees may be more reluctant to go to

meetings, sign authorization cards, or join employee committees. For instance, in Cellco

Partnership, Chairman Miscimarra, concurring with the Board majority, argued that

under his William Beaumont test a rule banning membership in an outside

organization that might interfere with work was unlawful, since employees would

readily understand such a rule to apply to unions.58 Similarly in Cellco, Chairman

Miscimarra concurred with the Board majority that a rule requiring employees to

remove themselves from discussing or voting on any matters concerning the employer

was also unlawful.59 Thus, bans or other limitations on membership in, or work for,

outside organizations that would be interpreted as covering unions will have a

significant impact on core rights under the Act

y in Cellco, Chairman

Miscimarra concurred with the Board majority that a rule requiring employees to

remove themselves from discussing or voting on any matters concerning the employer

was also unlawful.59 Thus, bans or other limitations on membership in, or work for,

outside organizations that would be interpreted as covering unions will have a

significant impact on core rights under the Act.

Legitimate Justifications: Employers have a legitimate and substantial interest

in preventing nepotism, self-dealing, fraud, or maintaining a financial interest in a

competitor, and rules against these “conflict of interest” activities fall in Category 1,

above. However, rules specifically prohibiting membership in outside organizations or

participation in any “voting” concerning the employer do not address those concerns, or

at least do not address them narrowly so as to accommodate legitimate concerns

without infringing on significant Section 7 rights.

Balance: If a rule is so broad as to be reasonably read as banning joining a union,

the impact on core Section 7 rights will be significant. Where the employer’s legitimate

56 Cellco Partnership d/b/a Verizon Wireless, 365 NLRB No. 38, slip op. at 10 (Feb.

23, 2017) (Miscimarra, concurring).

57 See id. (while the Board in this case found the conflict of interest rule unlawful

under Lutheran Heritage, Chairman Miscimarra, in concurrence, would have found it

unlawful under his William Beaumont test).

58 Id.

59 Id.

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ip op. at 10 (Feb.

23, 2017) (Miscimarra, concurring).

57 See id. (while the Board in this case found the conflict of interest rule unlawful

under Lutheran Heritage, Chairman Miscimarra, in concurrence, would have found it

unlawful under his William Beaumont test).

58 Id.

59 Id.

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goals can be served by a narrower rule, an overbroad rule should be unlawful. Because

employers can achieve their goal of preventing self-dealing and other business conflicts

of interest without banning membership in outside organizations, and because the right

to join a union is a fundamental right under the Act, such a rule will always be

unlawful.

Please contact the Division of Advice, or your AGC in Operations, if you have

questions about this Memorandum.

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