Hunton Employment & Labor Perspectives

On December 14, 2017, in a 3-2 decision along party lines, the National Labor Relations Board (the “Board”) issued a decision in The Boeing Company, 365 NLRB No. 154 (2017) case.  This is a significant and long-awaited victory for employers grappling with unfair labor practice charges stemming from facially neutral workplace rules and signals the Board’s intent to retreat from regulating non-union activity.  Specifically, Boeing  rescinds the onerous workplace rule standard in Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004) in favor of a new, more rational test.

Under the Lutheran Heritage standard, the Board found that an employer violated the NLRA simply by maintaining a workplace rule that an employee could “reasonably construe” as barring the exercise of rights under the NLRA. As explained in Boeing, “[t]hough well-intentioned, the Lutheran Heritage Standard prevent[ed] the Board from giving meaningful consideration to the real-world ‘complexities’ associated with many employment policies, work rules and handbook provisions.  Moreover, Lutheran Heritage produced rampant confusion for employers, employees and unions.”

In place of the Lutheran Heritage standard, the Board established a new test: when evaluating a facially neutral policy, rule, or handbook provision that would potentially interfere with the exercise of NLRA rights, the Board will evaluate: (1) the nature and extent of the potential impact on NLRA rights; and (2) legitimate justifications associated with the rule.  The decision also laid out three categories for rules that the Board said will “provide greater clarity and certainty to employees, employers and unions.”

Category 1 will include rules that the Board designates as lawful to maintain, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule;

Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications; and

Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule.

Applying the new standard, the Board in Boeing concluded that the employer lawfully maintained a no-camera rule that prohibited employees from using camera-enabled devices to capture images or video without a valid business need and an approved camera permit.  The Board majority reasoned that the rule potentially affected the exercise of NLRA rights, but that the impact was relatively slight and was outweighed by important justifications, including national security concerns.

Board Chairman Miscimarra (R) was joined by Board Members Kaplan (R) and Emanuel (R) in the majority opinion.  Members Pearce (D) and McFerran (D) dissented in the case.