The Boeing Company, Part II, The Employer Strikes Back

Last week, we discussed the NLRB’s old approach to analyzing work rules, and how the Board was often getting stuck on work rules that would possibly be interpreted by employees as restrictions on Section 7 rights under the NLRA.  For that discussion, you can read our post here:

The NLRB Considers the Employer’s Perspective!

This week, we’ll discuss the Board’s change in analysis of work rules, which takes a more rational approach to the rules and takes some of the realities of business management into account.

In The Boeing Company, the rule in question was a “no-camera rule,” which restricted the use of camera devices on its property.  Per the Board, it was not adopted in the face of union organizing and had no language that directly addressed Section 7 activities.

In response to a complaint brought by Boeing employees, an ALJ found that the rule violated the NLRA because employees “would reasonably construe” the rule to prohibit Section 7 activities.  The judge did not address Boeing’s desires for facility security.

For those of you who are unfamiliar with the business of Boeing, the company specializes in the design and manufacture of military and commercial aircraft; aircraft of which the design and vulnerabilities would be of great interest to competitors, foreign countries, and terrorist organizations.  As a result, it is clear why a company like Boeing might want to keep recording devices out of its manufacturing facilities.  These were facts that were all but ignored by the ALJ prior to the case coming to the NLRB.

In response to this, the Board laid out several issues it had with its earlier decision in Lutheran Heritage, and how it is applied to rules such as this.  There were as follows:

  • The “reasonably construe” standard only looks at the employee’s perspective regarding their rights, and not the employer’s justifications;
  • The standard requires employers to think of every interpretation of a rule that could be seen to impinge on protected activities;
  • The standard assumed the worst possible outcome for every ambiguous rule;
  • The standard took away the Board’s ability to apply its discretion to interpreting rules;
  • The standard provided no flexibility for analyzing rules based on the industry in which the employer conducted business;
  • The standard was very difficult to apply.

This led to the Board adopting a new standard, which reads as follows:

(W)hen evaluating a facially neutral policy, rule or handbook provision that, when reasonably interpreted, would potentially interfere with the exercise of NLRA rights, the Board will evaluate two things: (i) the nature and extent of the potential impact on NLRA rights, and (ii) legitimate justifications associated with the rule.

The Board then created three different categories of rules.  Category 1 includes rules that are lawful to maintain because either the rule does not prohibit or interfere with NLRA rights or the rule’s impact on rights is outweighed by the employer’s justifications for the rule.  Category 2 includes “rules that warrant individual scrutiny” to determine whether it would interfere with NLRA rights, and whether the impact is outweighed by the employer’s justifications.  Category 3 rules would be considered unlawful because they clearly prohibit Section 7 rights without legitimate justification.

The Board will now be using a fact-based balancing of both employee interests in exercising rights under Section 7 and employer interests in effectively operating a business.

After rattling off five different legitimate justifications for Boeing’s “no camera rule,” the Board found that Boeing was well within its rights to implement the rule to both protect its work product and maintain the security of its facilities and the country.

The Board’s new standard eliminates a great deal of confusion for employers attempting to create work rules to maintain order within their businesses while avoiding being slammed with charges by unions and employees for rules that might only slightly contemplate Section 7 rights.

Next week, we will go over the NLRB General Counsel’s guidance on the new standard, and provide examples for you to understand what kinds of rules you can feel comfortable promulgating within your workplace.