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D.C. Circuit Upholds NLRB Ban on Various Employee Handbook Policies

    Client Alerts
  • November 16, 2015
As exhaustively reported in EmployNews over the past several years, the National Labor Relations Board has been attacking numerous employee handbook provisions considered for years by employers to constitute standard employment policies. The NLRB has concluded that such policies violate Section 7 of the National Labor Relations Act because they could have the effect of chilling employees’ rights to engage in concerted activity. For example, broad prohibitions against disclosure of company information have been rejected on the grounds that this could apply to employee discussion of respective salaries.

In response to many of these decisions, employers have taken a “wait and see” position, refraining from revising their handbooks before determining whether federal courts will uphold the NLRB’s shifting views on the legality of these policies. Last week these employers received some bad news when the U.S. Court of Appeals for the District of Columbia Circuit affirmed the NLRB’s ban on various handbook policies.

In Hyundai Am. Shipping Agency, Inc. v. NLRB, the agency voided three handbook policies under Section 7. These included (1) a bar on employees discussing matters under investigation by the company; (2) limits on disclosing information maintained on the company’s electronic systems; and (3) prohibiting non-work activities during working time. The investigation rule was deemed overbroad because it was not limited to discussions that could interfere with the ongoing review. The electronic information policy did not restrict its reach to confidential company information. The last challenged rule could prohibit employees from engaging in organizing activities during breaks.

The court did uphold one challenged policy that urged but did not require employees to bring complaints to their supervisors. None of these policies involve the NLRB’s latest attempts to extend its jurisdiction to policies that appear to have less of an impact on concerted activity rights. However, the D.C. Circuit’s affirmation of the Board’s conclusions may indicate federal courts’ unwillingness to decide that the NLRB is exceeding its jurisdiction in rejecting common, boilerplate employment policies that were never intended to apply to Section 7 rights.