By: J. Gregory Grisham*

On March 18, 2015, the National Labor Relations Board’s (“NLRB’) General Counsel Richard F. Griffin, Jr. issued a 30-page Memo (“GC Memo”) summarizing current NLRB case law addressing Employer Work Rules.[i] The GC Memo breaks down Employer Handbook Rules into several categories and offers examples of “unlawful” rules and “lawful” rules under each category explaining why the rules were found to be unlawful or lawful.

A.    Handbook Rules Regarding Confidentiality

The GC Memo states that employees have a right under Section 7 of the National Labor Relations Act (“Act”) “to discuss wages, hours, and other terms and conditions of employment with fellow employees, as well as with nonemployees, such as union representatives.” Section 7 rights apply to both union and non-union employees. The GC Memo further states that an employer's confidentiality policy that expressly prohibits employees from discussing their terms and conditions of employment or that can be reasonably understood by employees as prohibiting such discussions would violate the Act. The GC Memo also notes that broad employer confidentiality rules that encompass employee or personnel information will be reasonably construed by employees as limiting protected Section 7 activity absent further clarification.

           The GC Memo recognizes that broad employer confidentiality rules are lawful where they do not reference employee information or information that could reasonably be construed as a term and condition of employment, since employers have a legitimate business interest in protecting the confidentiality of certain types of business information.  Even unlawful confidentiality rules can pass muster if when viewed in context employees would not reasonably understand the rules to restrict Section 7 activities.

1.     Examples of “Unlawful” Confidentiality Rules[ii]

• Do not discuss "customer or employee information" outside of work, including "phone numbers [and] addresses."

• "You must not disclose proprietary or confidential information about [the Employer, or] other associates (if the proprietary or confidential information relating to [the Employer's] associates was obtained in violation of law or lawful Company policy)."

• "Discuss work matters only with other [Employer] employees who have a specific business reason to know or have access to such information.... Do not discuss work matters in public places."

• Confidential Information is: "All information in which its loss, undue use or unauthorized disclosure could adversely affect the [Employer's] interests, image and reputation or compromise personal and private information of its members."

2.     Examples of “Lawful” Confidentiality Rules[iii]

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

• "Do not disclose confidential financial data, or other non-public proprietary company information. Do not share confidential information regarding business partners, vendors or customers."

•Prohibition on disclosure of all "information acquired in the course of one's work."

B.    Employer Handbook Rules Regarding Employee Conduct toward the Company and Supervisors

       The GC Memo notes Section 7 rights include the right of employees “to criticize or protest their employer's labor policies or treatment of employees.” Examples include rules that prohibit employees from engaging in conduct that is "disrespectful," "negative," "inappropriate" or "rude" toward their supervisor or other member of management unless such rules are clarified or placed in proper context. Moreover, rules that prohibit “false statements” will be found to be unlawful unless it is specified that the prohibition is limited to “maliciously false statements.”

The GC Memo further states that rules that require employees to be “respectful and professional to coworkers, clients, or competitors, but not the employer or management” will generally pass muster because the employer has a legitimate interest in protecting and maintaining these types of relationships. Finally, rules that prohibit insubordinate conduct are also generally found to be lawful. 

1.     Examples of “Unlawful” Rules Regulating Employee Conduct towards the Employer[iv]

• "Be respectful to the company, other employees, customers, partners, and competitors."

• Do "not make fun of, denigrate, or defame your co-workers, customers, franchisees, suppliers, the Company, or our competitors."

• "Chronic resistance to proper work-related orders or discipline, even though not overt insubordination" will result in discipline.

• "[I]t is important that employees practice caution and discretion when posting content [on social media] that could affect [the Employer's] business operation or reputation."

• Do not make "[s]tatements "that damage the company or the company's reputation or that disrupt or damage the company's business relationships."

2.     Examples of “Lawful” Rules Regulating Employee Conduct towards the Employer[v]

• No "rudeness or unprofessional behavior toward a customer, or anyone in contact with" the company.

• "Each employee is expected to work in a cooperative manner with management/supervision, coworkers, customers and vendors."

• "Each employee is expected to abide by Company policies and to cooperate fully in any investigation that the Company may undertake."

• "Being insubordinate, threatening, intimidating, disrespectful or assaulting a manager/supervisor, coworker, customer or vendor will result in" discipline.

C. Employer Handbook Rules Regulating Conduct Towards Fellow Employees

The GC Memo sets forth a third area of Section 7 rights that protect employee rights to “argue and debate with each other about unions, management, and their terms and conditions of employment.” Thus, employer rules that prohibit "negative" or "inappropriate" discussions among its employees, without further clarification, can be reasonably construed by employees as infringing on their Section 7 rights. However, the GC Memo recognizes that employer rules that prohibit harassment are lawful provided they cannot be reasonably read as proscribing “vigorous debate or intemperate comments regarding Section 7 protected subjects.”

1.     Examples of “Unlawful” Employee-Employee Conduct Rules[vi]

• "[D]on't pick fights" online.

• Do not make "insulting, embarrassing, hurtful or abusive comments about other company employees online," and "avoid the use of offensive, derogatory, or prejudicial comments."

• "[S]how proper consideration for others' privacy and for topics that may be considered objectionable or inflammatory, such as politics and religion."

• "Material that is fraudulent, harassing, embarrassing, sexually explicit, profane, obscene, intimidating, defamatory, or otherwise unlawful or inappropriate may not be sent by e-mail. ..."

2.     Examples of “Lawful” Employee-Employee Conduct Rules[vii]

• "Making inappropriate gestures, including visual staring."

• Any logos or graphics worn by employees "must not reflect any form of violent, discriminatory, abusive, offensive, demeaning, or otherwise unprofessional message."

• "[T]hreatening, intimidating, coercing, or otherwise interfering with the job performance of fellow employees or visitors."

• No "harassment of employees, patients or facility visitors."

• No "use of racial slurs, derogatory comments, or insults."

D. Employer Handbook Rules Regarding Employee Interaction with 3rd Parties

      The fourth area of protected Section 7 activity addressed by the GC Memo is the “right to communicate with the news media, government agencies, and other third parties about wages, benefits, and other terms and conditions of employment.” Given this right to communicate, employer rules (such as company media policies) that could reasonably be interpreted as limiting such communications will be found to be unlawfully overbroad.  The employer of course may specify by rule the employees who are authorized to speak on the employer’s behalf.

1.     Examples of “Unlawful” Rules Regulating Third Party Communications[viii]

• Employees are not "authorized to speak to any representatives of the print and/or electronic media about company matters" unless designated to do so by HR, and must refer all media inquiries to the company media hotline.

• "If you are contacted by any government agency you should contact the Law Department immediately for assistance."

2.     Example of “Lawful” Rules Regulating Employee Communications with Outside Parties[ix]

• "Events may occur at our stores that will draw immediate attention from the news media. It is imperative that one person speaks for the Company to deliver an appropriate message and to avoid giving misinformation in any media inquiry. While reporters frequently shop as customers and may ask questions about a matter, good reporters identify themselves prior to asking questions. Every employee is expected to adhere to the following media policy: Answer all media/reporter questions like this: 'I am not authorized to comment for [the Employer] (or I don't have the information you want). Let me have our public affairs office contact you."

E. Employer Handbook Rules Restricting Use of Company Logos, Copyrights, and Trademarks

      Another area of potential conflict between Employer rights and the Section 7 rights of employees are handbook rules that restrict employee use of company logos, copyrights, or trademarks. The GC Memo recognizes that while “copyright holders have a clear interest in protecting their intellectual property” employer rules can violate the Act where they prohibit employees' fair protected use of that property such as use of the employer’s “name and logo on picket signs, leaflets, and other protest material.”

1.     Examples of “Unlawful” Rules Banning Employee Use of Logos, Copyrights, or Trademarks[x]

• Do "not use any Company logos, trademarks, graphics, or advertising materials" in social media.

• "Use of [the Employer's] name, address or other information in your personal profile [is banned]…. In addition, it is prohibited to use [the Employer's] logos, trademarks or any other copyrighted material."

2.     Example of “Lawful” Rules Protecting Employer Logos, Copyrights, and Trademarks[xi]

• "Respect all copyright and other intellectual property laws. For [the Employer's] protection as well as your own, it is critical that you show proper respect for the laws governing copyright, fair use of copyrighted material owned by others, trademarks and other intellectual property, including [the Employer's] own copyrights, trademarks and brands."

F. Employer Handbook Rules Restricting Photography and Recording

The GC Memo states that Employees have Section 7 rights “to photograph and make recordings in furtherance of their protected concerted activity, including the right to use personal devices to take such pictures and recordings.” Therefore, rules that prohibit any photography or recording or ban the possession of personal devices in the workplace where they can reasonably be construed to “prohibit the taking of pictures or recordings on non-work time” will violate the Act.

1.     Examples of “Unlawful” Rules Banning Photography, Recordings, or Personal Electronic Devices[xii]

• "No employee shall use any recording device including but not limited to, audio, video, or digital for the purpose of recording any [Employer] employee or [Employer] operation...."

• A total ban on use or possession of personal electronic equipment on Employer property.

• Prohibition from wearing cell phones, making personal calls or viewing or sending texts "while on duty."

• No cameras are to be allowed in the store or parking lot without prior approval from the corporate office.

G. Employer Handbook Rules Restricting Employees from Leaving Work

The GC Memo recognizes that Section 7 gives employees the right to go on strike. Therefore, handbook provisions that “regulate when employees can leave work are unlawful if employees reasonably would read them to forbid protected strike actions and walkouts.”  The GC Memo further states that rules that do not contain the words “strikes," "walkouts," "disruptions," “or the like,” will not be reasonably interpreted by employees as limiting their protected concerted activity and will not violate the Act.

1.     Example of “Unlawful” Handbook Rules Relating to Restrictions on Leaving Work[xiii]

• "Failure to report to your scheduled shift for more than three consecutive days without prior authorization or 'walking off the job' during a scheduled shift" is prohibited.

2.     Example of “Lawful” Handbook Rules Relating to Restrictions on Leaving Work[xiv]

•"Walking off shift, failing to report for a scheduled shift and leaving early without supervisor permission are also grounds for immediate termination."

H. Employer Conflict-of-Interest Rules

The GC Memo also stresses that Section 7 protects “employees’ rights to engage in concerted activity even if that activity is in conflict with the employer's interests.” For example, such activities may include “a protest in front of the company ... a boycott, and [the] solicit[ation][of] support for a union while on non-worktime.” Employer conflict-of-interest rules that would reasonably be construed as prohibiting such protected activities will be found unlawful. The Memo notes that such rules will be found to be lawful if “the rule includes examples or otherwise clarifies that it is limited to legitimate business interests, employees will reasonably understand the rule to prohibit only unprotected activity.”

1.     Example of “Unlawful” Conflict-of-Interest Rules[xv]

• Employees may not engage in "any action" that is "not in the best interest of [the Employer]."

2.     Examples of “Lawful” Conflict-of-Interest Rules[xvi]

• Do not "give, offer or promise, directly or indirectly, anything of value to any representative of an Outside Business," where "Outside Business" is defined as "any person, firm, corporation, or government agency that sells or provides a service to, purchases from, or competes with [the Employer]." Examples of violations include "holding an ownership or financial interest in an Outside Business" and "accepting gifts, money, or services from an Outside Business."

• As an employee, "I will not engage in any activity that might create a conflict of interest for me or the company," where the conflict of interest policy devoted two pages to examples such as "avoid outside employment with an employer customer, supplier, or competitor, or having a significant financial interest with one of these entities."

I.      CONCLUSION

The GC Memo is helpful to employers in that it sets forth examples of handbook rules that may be open to challenge under the Act as well as examples of rules that will found to be lawful. The Memo stresses that the context in which the rule is presented is an important consideration in evaluating the legality of the rule. Wise employers and their counsel should undertake a review of existing handbook rules in light of this guidance and consider modifying handbook provisions that may run afoul of the Act.

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*J. Gregory Grisham is Of Counsel to Leitner Williams Dooley & Napolitan, PLLC in its Nashville Office. Greg may be reached at greg.grisham@leitnerfirm.com or (615) 255-7722.