In August 2023, the National Labor Relations Board ("NLRB") in Stericycle, Inc. adopted a strict standard for evaluating whether a given employer work rule violates the National Labor Relations Act ("NLRA"). Our prior overview of the Stericycle decision and the new NLRB standard can be found here. More recently, the Board's General Counsel issued Memorandum GC 24-04 directing the Board's regional directors to seek broad remedies against employers who promulgate unlawful work rules. The proposed remedies would greatly exceed the traditional remedy of a mere rescission of the rule(s) found to be unlawful.
More specifically, post-Stericycle, the NLRB's General Counsel has challenged, and administrative law judges ("ALJs") have found unlawful, rules commonly found in employer handbooks, including:
- General civility rules, including rules requiring that employees treat each other with dignity and respect and that employees communicate with each other and with customers in a "professional and respectful manner."
- Confidentiality rules that would require an employee keep confidential "company records," which an employee could read to include compensation information.
- Rules prohibiting soliciting or wasting time on company property "during working hours," which an employee could read to include during breaks.
- An "open door policy" encouraging only "good faith" complaints.
- A requirement that an employee keep confidential the details of an investigation when that obligation lasted indefinitely.
Traditionally, the General Counsel has sought as a remedy only the rescission of unlawful work rules. In the recently released Memorandum GC 24-04, however, the General Counsel directed the Board's regional directors to seek broad remedies to "make-whole" the employees harmed by unlawful work rules. The General Counsel directs that, in settlement negotiations, regional directors should seek from employers the details of employees disciplined within the relevant limitations period (generally six months before the filing of a charge) for violating an unlawful work rule. The General Counsel then instructs the regional director to seek expungement of disciplinary records, backpay, reinstatement, and other damages for such employees as applicable. In cases that do not settle, the General Counsel directs regional directors to urge the Board to make-whole employees yet to be named.
In short, the recent memorandum seeks to add more "teeth" to the Stericycle decision, and furthers the NLRB's incursion into non-union workplaces. While the full Board has not yet adopted the General Counsel's view on remedies for unlawful work rules, employers should continue to review and revise their handbooks in light of Stericycle and the potentially greater ramifications for maintaining unlawful work rules.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
