Reed Smith Client Alerts

On December 14, the National Labor Relations Board (“the Board”) overturned two unpopular decisions that created confusing and ineffective rules. Employers have struggled for many years with crafting workplace policies and determining joint employer status in ways agreeable to the Board. Previously, the Board followed a standard for writing workplace policies that was difficult to apply and led to restrictions on popular, common-sense employee handbook language. The Board also used a joint employer standard that was nebulous, often determined by never-exercised contract provisions, and did not provide adequate guidance for employers seeking to engage in an employment relationship. As of December 14, the Board has created new standards for evaluating workplace policies and determining joint-employer status under the National Labor Relations Act (“the Act”) that provide more rational guidance and clearer standards for employers

In The Boeing Company, 365 NLRB No. 154 (2017), the Board overturned its Bush-era decision in Lutheran Heritage Village-Livonia, 343 NLRB No. 646 (2004), which prohibited workplace rules and employee handbook provisions that could be “reasonably construed” by an employee to forbid the exercise of the right to protected concerted activity under the Act. Lutheran Heritage therefore allowed the Board to invalidate any rule that could ever conceivably be interpreted to infringe on protected concerted activity. As a result, the Board invalidated many logical workplace rules, such as those that required respectful behavior to supervisors and fellow employees. In The Boeing Company, the Board reversed Lutheran Heritage in favor of a common-sense standard that requires analysis of the practical effects of each workplace rule, as well as the likelihood that it will actually infringe upon protected rights under the Act. The Board wisely noted that it does not believe “that when Congress adopted the [National Labor Relations Act] in 1935, it envisioned that an employer would violate federal law whenever employees were advised to ‘work harmoniously’ or conduct themselves in a ‘positive and professional manner.’”