Labor Board Sets New Standard for Workplace Policies and the NLRA

Recently, the National Labor Relations Board (NLRB) set a new standard for instituting and enforcing workplace policies with respect to the National Labor Relations Act (NLRA). In a separate decision, the NLRB limited the rights of employers to discipline employees for some types of abusive conduct. Specifically, the decision applies if that behavior occurred while they engaged in concerted activity. This recent decision differs from an administrative law judge’s (ALJ’s) earlier decision regarding misconduct not related to concerted activity. In that decision, the ALJ, on behalf of the NLRB, decided that adverse action for legitimate business reasons was legal if it was for misconduct by employees not engaged in any protected activity.

Employee Rights Under Section 7 of the NLRA

Under the NLRA, both union and non-union employees have the right to engage in concerted activity whereby two or more employees act for their mutual aid regarding the terms and conditions of their employment. Examples of concerted activity include:

• talking about wages and benefits;
• petitioning for better hours;
• concerted refusal to work amidst unmitigated workplace safety hazards; and
• talking with the employer, government agency, or the media about problems in the workplace.

Under Section 7 of the NLRA (Section 7), employers may not interfere with, restrain, or coerce employees in the exercise of their rights under the NLRA. For example, the NLRA protects employees from adverse employment action for engaging in protected concerted activity.

Previous Standards for Workplace Policies Under the NLRA

Before 2017, the NLRB examined the legality of workplace policies using the standard established in Lutheran Heritage Village-Livonia. In the Lutheran Heritage decision, the NLRB determined that workplace policies violate the NLRA if employees “reasonably construed” them to prohibit protected concerted activity, were issued in response to union activity, and if employers previously applied them to restrict employees from exercising rights under the NLRA. The phrase “reasonably construed” was at the heart of the matter. In 2017, the NLRB gave a new standard for workplace policies in The Boeing Company decision. In this decision, the NLRB adopted a test to weigh the “nature and extent of the impact on NLRA rights.” It replaced the previous “reasonably construed” standard. Under the Boeing standard, business justification for workplace policies could outweigh any adverse impact.

New Standard for Workplace Policies Under the NLRA

With the NLRB’s recent decision in Stericycle, Inc., the Board modified the “reasonably construed” portion of the original Lutheran Heritage decision. According to the Stericycle, Inc. decision, workplace policies violate the NLRA if they have a “reasonable tendency” to discourage or “chill” employees from exercising their rights under Section 7. However, employers may rebut such a presumption if they can prove that workplace policies advance “legitimate and substantial business interests.” They must also prove that a narrower rule would not be effective. Most importantly, the new standard considers, specifically, how the employee would interpret a workplace policy to violate their Section 7 rights rather than whether another party would reasonably interpret it differently.

Discipline, Abusive Conduct, and Protected Concerted Activity

In another decision, the NLRB limited employer rights to discipline employees for abusive conduct while engaged in protected concerted activity. In the Lion Elastomers LLC decision, the NLRB focused on employee abusive conduct consisting of profanity or insulting language, including isolated racial remarks. A 2020 NLRB decision on discipline for abusive conduct focused on an “employer’s motivation” for the discipline. That is to say, whether it was based on the abusive conduct or the protected activity. In the Lion Elastomers decision, the legality of employee discipline or any adverse action against an employee depends on whether the abusive conduct was sufficiently abusive or severe enough not to be protected. To support this decision, the NLRB noted that under Title VII of the Civil Rights Act, isolated incidents of racially-charged comments do not rise to the level of racial harassment. Therefore, the NLRB decided that even if the employer has a zero-tolerance policy against racial abuse, they must still consider whether an isolated incident occurred while an employee engaged in protected concerted activity.