NLRB’s Do’s and Don’ts of Employer Handbooks: Part 1

On March 18, 2015, the National Labor Relations Board (NLRB) Office of the General Counsel released a 30-page memorandum providing guidance on employer rules and handbooks. The memorandum further solidified the NLRB’s increased attention to, and enforcement efforts toward, non-union employers. In the memorandum – which applies to union and non-union employers – the general counsel provides examples of lawful and unlawful employer rules and policies on topics ranging from confidentiality in the workplace, conduct between coworkers, interactions with third parties, use of logos and trademarks, and employee interactions with management employees.

This part one of a three-part series detailing key takeaways from the general counsel’s memorandum focuses on policies regarding confidentiality and employees’ conduct toward management. For part two (which addresses policies pertaining to conduct toward coworkers and third parties), click here. For part three (which addresses Trademarks and Logos, Photography and Workplace Recording, Leaving Work, Conflicts of Interest), click here.

Policies Regarding Confidentiality

Confidentiality policies that specifically prohibit employee discussions of terms and conditions of employment (i.e., wages, hours or workplace complaints) or that employees would reasonably understand to prohibit such discussions may be deemed unlawful. Similarly, a confidentiality rule that broadly encompasses “employee” or “personnel” information, without further clarification, likely will be found overbroad, as will confidentiality policies that limit an employee’s ability to organize a strike or form a union. Accordingly, employers should narrowly draft confidentiality rules to refer specifically to the types of information protected by the confidentiality rule, such as trade secrets and customer information.

Having said this, employers have a legitimate interest in keeping certain business information confidential. Thus, broad prohibitions on disclosing “confidential” information are lawful so long as they do not reference information regarding employees or terms and conditions of employment. Policies can use the general term “confidential” or “confidential information” so long as they do not define it in an overbroad manner. The NLRB also will view confidentiality policies in context, and will find them lawful if, when viewed in context, employees would not reasonably understand the rule to prohibit activity protected by the NLRA.

Examples of policy terms regarding confidentiality referenced in the general counsel’s March 18 memorandum that were deemed unlawful include the following:

• Do not discuss “customer or employee information” outside of work, including “phone numbers [and] addresses.”
• “Never publish or disclose [the Employer’s] or another’s confidential or other proprietary information. Never publish or report on conversations that are meant to be private or internal to [the Employer].”
• “Sharing of [overheard conversations at the work site] with your co-workers, the public, or anyone outside of your immediate work group is strictly prohibited.”
• “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.”

Examples of policy terms regarding confidentiality referenced in the general counsel’s March 18 memorandum that were deemed lawful include the following:

• No unauthorized disclosure of “business ‘secrets’ or other confidential information.”
• “Misuse or unauthorized disclosure of confidential information not otherwise available to persons or firms outside [Employer] is cause for disciplinary action, including termination.”
• “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” when this policy is read in the context of surrounding policies pertaining to conflicts of interest and compliance with SEC regulations.

Policies Regarding Employee Conduct Toward Management

The NLRA protects employees’ ability to criticize or protest their employer’s labor policies or treatment of employees. Policies restricting these rights may be found overbroad, particularly if the rules restrict employees from criticizing the employer in public. For example, a rule that prohibits employees from engaging in “disrespectful,” “negative,” “inappropriate” or “rude” conduct toward the employer or management (absent sufficient clarification or context) may be found unlawful. Moreover, false and defamatory statements also are protected by the NLRA, unless such statements are maliciously false.

On the other hand, although an employer cannot maintain a policy requiring employees to act courteously in their dealings with management, employers have a legitimate business interest in having employees act professionally and courteously in their dealings with coworkers, customers, employer business partners and other third parties. Accordingly, rules that require employees to be respectful and professional to people other than management personnel generally will be found lawful. Employers also can generally prohibit “insubordination” and require “cooperation.” Policies are read in context, however, such that it can be difficult to analyze policy language in a vacuum.

Examples of policy terms regarding employee conduct toward management referenced in the general counsel’s March 18 memorandum that were deemed unlawful include the following:

• “[B]e 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.”
• No “[d]efamatory, libelous, slanderous or discriminatory comments about [the Company], its customers and/or competitors, its employees or management.”
• “Disrespectful conduct or insubordination, including, but not limited to, refusing to follow orders from a supervisor or a designated representative.”
• “Refrain from any action that would harm persons or property or cause damage to the Company’s business or reputation.”

Examples of policy terms regarding employee conduct toward management referenced in the general counsel’s March 18 memorandum that were deemed lawful include the following:

• No “rudeness or unprofessional behavior toward a customer, or anyone in contact with” the company.
• “Employees will not be discourteous or disrespectful to a customer or any member of the public while in the course and scope of [company] business.”
• “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.”

Conclusion

Employers should strongly consider reviewing their handbooks and rules to determine whether their policies on confidentiality and employee conduct toward management and coworkers run afoul of the NLRB’s recent guidance. Employers should consider revising any policy that could reasonably be interpreted to: (a) restrict employees from disclosing information about wages, labor violations or terms and conditions of employment; or (b) limit employees’ rights to be critical of or toward management. Further, where possible, consider using more specific language with examples regarding the scope of confidential information and employee conduct expectations, in lieu of broad statements requiring employees to treat all work-related matters as confidential and/or to be generally respectful of others.

As detailed in previous client alerts (for example here and here), the NLRB and the Office of the General Counsel show no signs of diverting their attention from non-union employers’ policies and practices. In parts two and three of this three-part series, we will review policies regarding (1) employee conduct toward coworkers and third parties; (2) use of logos, copyrights, and trademarks; (3) photography and workplace recording; (4) leaving work; and (5) conflicts of interest.

To read the general counsel’s March 18, 2015 memorandum, click here.

Please reach out to your McGuireWoods contact or a member of the McGuireWoods labor and employment team for any questions you may have or assistance you might need in bringing your handbook or policies into compliance.