How Employers Can Comply with NLRB’s Stericycle Inc. Decision
Last month, the National Labor Relations Board (NLRB) made a significant announcement that will have far-reaching implications for workplace policies in both unionized and non-unionized settings. Stericycle Inc., as the decision is known, represents a departure from the 2017 Boeing Company decision, which employed a balancing test to evaluate employer workplace rules and handbook provisions. Under the new Stericycle standard, any overly broad employer rule or policy that has the potential to discourage employees from exercising their rights under the National Labor Relations Act (NLRA) may be considered unlawful.
The Stericycle decision is essentially a return to the NLRB’s stance on workplace rules established in the 2004 Lutheran Heritage decision, which targeted common employer rules and policies that promoted civility, courtesy, and productivity, and prohibited harassment, disruption, and insubordination in the workplace. The NLRB General Counsel (GC) will need to demonstrate that an employer rule or policy could inhibit employees from exercising their protected Section 7 rights, which encompass various activities related to their terms and conditions of employment.
Stericycle introduces an important change to Lutheran Heritage, which used a “reasonable employee” standard to evaluate the lawfulness of workplace rules. The NLRB will now assess employer rules from the viewpoint of an employee who is “economically dependent” on the employer and contemplates engaging in protected concerted activity. This perspective acknowledges the vulnerability of employees in relation to their employers and emphasizes the need for workplace rules to be narrowly tailored to serve legitimate business interests.
Demonstrating that a rule is unlawful will be the responsibility of the GC. A policy can be deemed an unfair labor practice if an employee could reasonably interpret the rule as coercive, even if it could also have a different interpretation, and even if the employer did not intend to restrict employee rights. However, employers can defend their rules under the Stericycle standard by proving that they advance legitimate and substantial business interests that cannot be achieved with a more narrowly tailored rule.
It should be noted that Stericycle retroactively applies to cases involving employer policies that are facially unlawful. This means that pending cases may require the rescission of rules deemed unlawful, with employers having the opportunity to replace them with more narrowly tailored alternatives.
Employers and managers who wish to review this decision in its entirety can do so, here.
Given this ruling, employers are urged to review and revise workplace policies and handbooks, with consideration given to how employees who are economically dependent on the company might perceive them. This applies to almost all private sector non-supervisory workers in the U.S., regardless of union affiliation, as both union and non-union workers are protected by Section 7 of the National Labor Relations Act. Employers are encouraged to craft specific, non-coercive rules that align with their legitimate business interests. Bleakley Platt & Schmidt’s Labor & Employment Law Practice Group has decades of experience helping companies stay compliant with changing NLRB regulations and decisions. To learn more, contact Joseph DeGiuseppe at jdegiuseppe@bpslaw.com.