Last week, the National Labor Relations Board, voting 3-2 on party lines, rolled back several Obama Administration-era decisions that were widely criticized as significant changes to well-established Board law in an effort to roll back some of the more controversial rulings.
First, on late Friday afternoon, the Board overturned it decision in Specialty Healthcare, which allowed so-called “micro-units” of workers to form a collective bargaining unit and unionize. In PCC Structurals, Inc., the Board reinstated 50-year-old precedent that requires employees to show that they have a community of interest “sufficiently distinct” from other employees to merit a bargain unit that excludes others.
In addition, the NLRB overturned the convoluted standards for joint employment articulated in Browning Ferris Industries. In Hy-Brand Industrial Contractors Ltd., the Board abandoned the concepts of horizontal and vertical joint employment and returned to the long-time standard that requires a showing that a company must have “direct and immediate control” to be a joint employer under the NLRA.
Further, in Raytheon Network Centric Systems, the Board restored another precedent of more than 50 years to once again permit union employers to change employer policies without a union’s blessing if the employer had a past practice of making those changes without seeking union approval.
Finally, in The Boeing Company, the NLRB rejected a standard used to determine if employment policies and work rules violate Section 8(1)(1) of the National Labor Relations Act if the policy or work rule would “reasonably tend to chill employees in the exercise of their Section 7 rights.” The Board rejected its ruling in Lutheran Heritage, which articulated a heightened standard of review. In its place, the NLRB will engage in a balancing test when determining the legality of facially neutral rules which, when reasonably interpreted, may potentially interfere with National Labor Relations Act (“NLRA”) rights. In this regard, the NLRB will balance the “(i) the nature and extent of the potential impact on NLRA rights, and (ii) legitimate justifications associated with the rule.”
In this ruling, The Board identified three categories of rules that it will be considering when engaging in this balancing test:
- Category 1 rule: Lawful because the rule, when reasonably interpreted, does not interfere or prohibit the exercise of NLRA rights or the potential adverse impact of the rule on such rights are outweighed by the legitimate justifications for the rule. The Board noted that the “harmonious conduct” rule and other rules dealing with civility fit within this category, and it overruled the cases finding such rules unlawful. The Board did recognize that the employer in certain instances may violate the NLRA by its application of these rules.
- Category 2 rule: Rules that will require individual consideration as to whether the rule interferes with NLRA rights and, if so, whether the legitimate justifications outweigh the potential adverse impact on NLRA rights.
- Category 3 rule: Unlawful because the rule prohibits or limits the exercise of NLRA rights and the adverse impact on NLRA rights are not outweighed by the legitimate justifications for the rules. Rules that fit into this category include those that prohibit employees from discussing wages and benefits.
In Boeing, the NLRB considered the validity of a “no-camera” rule and found that the rule was justified, for among other things, reasons of security and confidentiality, such as preventing the disclosure of proprietary and personal information. The Board noted that the adverse impact that the no-camera rule has on the exercise of NLRA rights is “comparatively slight.” In this regard, the Board stated that “[t]aking photographs to post on social media for the purpose of entertaining or impressing others … certainly falls outside of the Act’s protection.” The Board held that no-camera rules generally fit within Category 1 and should normally be found lawful. The Board held that this new standard will be applied retroactively.
This article was authored by Al Sebok, Jackson Kelly PLLC. For more information on the author, see here.