United States: NLRB’s Actions In 2012 Highlight Critical Labor Issues For Nonunion Employers

David Santeusanio is a Partner and Brian Doyle an Associate in our Boston office

In 2012, the National Labor Relations Board (NLRB or Board) aggressively staked out positions on employment policies and practices prevalent in both union and nonunion workplaces. These issues include social media policies and practices, at-will statements in employee handbooks, statements to employees in internal investigations about the need to maintain confidentiality, and arbitration policies and agreements. The Board addressed them in the context of union and nonunion workplaces, and regularly brought enforcement actions against nonunion employers for alleged violations of the National Labor Relations Act (NLRA).

Although nonunion employers have always been subject to the NLRA and to the enforcement powers of the NLRB, the developments in 2012 underscore the need for all employers to address the NLRA aspects of common workplace policies and practices. This alert provides background on the NLRA and NLRB and summarizes last year's developments.


The NLRA sets forth the rights of employers and employees with respect to union organizing and collective action by employees. The NLRA applies to almost all private sector employers.

Section 7 of the NLRA states that in addition to the right to unionize, "employees shall have the right to . . . engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection." An activity is "concerted" when an employee acts with or on the authority of other employees and not solely by and on behalf of the employee himself or herself. Concerted activity includes circumstances where individual employees seek to initiate or to induce or prepare for group action. Section 7 applies to all covered employees, regardless of whether the workplace is union or nonunion.

The NLRB is the federal agency charged with investigating and remedying alleged violations of the NLRA. The NLRB is comprised of a five-member Board and an Office of the General Counsel. Board members are appointed to staggered five-year terms, with a new Board vacancy coming up every year. The Board currently consists of only three members - all Democrats appointed by President Obama. 

The NLRB's Office of the General Counsel investigates and prosecutes unfair labor practices. This position is currently held by an Acting General Counsel, Lafe Solomon, whose nomination was sent to the Senate in January 2011 but has not come before the full Senate for a vote. The general counsel serves a four-year term.

In 2012, the NLRB addressed several workplace issues common to both union and nonunion workplaces. In addressing these issues, the NLRB focused on whether an employer's policies or practices interfered with an employee's ability to engage in protected concerted activity under Section 7 of the NLRA. The NLRB's actions highlight the need for union and nonunion employers to review and evaluate their policies and procedures to ensure compliance with the NLRA.

Social Media Policies and Practices

In 2012, the NLRB emphasized that employees who use social media to interact with their co-workers about their working conditions may be engaged in protected concerted activity, and employer social media policies and practices that restrict such activity may violate Section 7. The Board explained these positions in a series of reports, enforcement actions and decisions.

The acting general counsel released two reportsin 2012 addressing social media policies and providing guidance to employers.1 A January 2012report detailed the outcomes of cases concerning the use of social media by employees and employer's social media policies.2 A May 2012 report analyzed six social media policies that the NLRB found to contain unlawful provisions and a seventh policy that NLRB concluded was lawful (albeit after a revision).3

The NLRB also addressed the issue of social media policies in two cases decided in September 2012. In both cases, the Board concluded that social media policies and other employer rules that broadly limited employees' posts and communications on social media violated employees' Section 7 rights to engage in protected concerted activity. In one case, the company's policy stated that an employee's on-line statements that "damage the Company, defame any individual or damage any person's reputation" could result in discipline or termination of employment. The Board concluded that this rule was unlawful because employees would reasonably interpret the rule to restrict Section 7 rights - including the employees' right to criticize the company about their working conditions - and nothing in the rule suggested Section 7 activities were exempt from the rule. Similarly, in the second case, the employee handbook had a "Courtesy Rule" prohibiting an employee from being "disrespectful" or using "language which injures the image or reputation of the [employer]." The Board found the "Courtesy Rule" unlawful because employees would reasonably construe the broad prohibition to include Section 7 activity, such as objecting to working conditions or seeking support from others to improve working conditions.

Most recently, in a December 14, 2012 decision in Hispanics United of Buffalo, Inc., the Board concluded that the employer (a nonprofit organization) violated the NLRA when it terminated the employment of fiveemployees who made comments on Facebook concerning workplace issues. See 359 NLRB 37 (Dec. 14, 2012). In that case, a co-worker informed a colleague that she planned to complain to management about the organization's failure to provide adequate and timely assistance to clients and about what she believed was substandard performance by her co-workers. In response, the colleague - from her home and on her personal computer - posted the following statement on Facebook: "[Co-worker] feels that we don't help our clients enough at [Respondent Organization]. I about had it! My fellow coworkers how do u feel?" Four employees - on their own personal time and on their personal computers - posted messages on Facebook generally objecting to their co-worker's criticism that their performance was substandard. The employer terminated the employment of five employees who posted on Facebook on the ground that the postings violated the employer's "zero-tolerance" policy prohibiting harassment and bullying.

The Board concluded that the Facebook postings constituted protected concerted activity under Section 7 and that the employer violated the NLRA. The Board determined that the initial Facebook comment and the responses were concerted activity because the employees made the comments in "common cause" and because the comments constituted a "first step towards taking group action" to defend themselves against a co-worker's accusation. The Board rejected the employer's position that the comments were unprotected harassing and bullying comments in violation of its "no tolerance" policy because the comments were not based on any protected category (e.g., race, sex, religion) and therefore were outside the scope of the employer's anti-harassment policy. Further, the Board noted that any legitimate managerial concerns to prevent harassment "do not justify policies that discourage the free exercise of Section 7 rights by subjecting employees to . . . discipline on the basis of the subjective reactions of others to their protected activity." The Board ordered that the employer reinstate the five employees and make them whole for lost earnings and benefits, among other remedies.

Social media policies serve legitimate purposes, including protecting against the disclosure of confidential information, prohibiting defamatory statements and prohibiting an employee from making disparaging comments about the employer's products, services, or customers. But as the NLRB's recent actions demonstrate, an overbroad social media policy potentially raises NLRA concerns. Unions, in turn, can use a challenge to a nonunion employer's social media policy as a springboard to organizing.

Employers should review their social media policies in light of the NLRB's guidance. They also should carefully evaluate the enforcement of harassment or bullying policies to ensure that those policies are not applied so broadly as to prohibit activity protected by the NLRA. And when considering taking an adverse employment action against an employee for the employee's statement on social media, employers should consider carefully the relevant NLRA issues.

At-Will Statements in Handbooks

Nonunion employers regularly include statements in employee handbooks confirming that employment is terminable at-will and limiting the authority of managers to change such policies. The NLRB has concluded that certain at-will statements in employee handbooks violate the NLRA because the statements suggest that employees cannot modify their at-will status through collective action and other protected concerted activity. The recent cases and NLRB guidance are instructive to employers.

In a case decided on February 1, 2012, an NLRB administrative law judge concluded that an employer violated the NLRA when its handbook required employees to acknowledge that "the at-will employment relationship cannot be amended, modified or altered in any way." In that case, an employee refused to sign the acknowledgement and her employment was terminated, leading to an unfair labor practice charge. The judge concluded that the at-will statement effectively required an employee to waive his or her Section 7 right to take concerted action to change the at-will status of employment. The judge concluded that such a provision may restrict employees from working together to collectively bargain for a change in their employment status.

The NLRB brought a second case on February 29, 2012 against an employer alleging a Section 7 violation on the grounds the employer had an "overly broad and discriminatory acknowledgement form in its employee handbooks" concerning the at-will nature of employment. Specifically, the employer required the following acknowledgement:

I acknowledge that no oral or written statements or representations regarding my employment can alter my at-will employment status, except for a written statement signed by me and either [the Company's] executive vice-president/chief operating officer or [the Company's] president.

In its complaint, the NLRA asserted that such a policy was a violation of an employee's NLRA right to organize. The case settled quickly. But the NLRB's prosecution of an action based on this policy further signaled that NLRB will aggressively pursue this theory of an NLRA violation.

The NLRB subsequently offered guidelines on permissible at-will statements. The NLRB's Division of Advice - which typically reviews novel or significant cases - concluded that two at-will statements were consistent with Section 7. In the case of Rocha Transportation, No. 32-CA-086799 (October 31, 2012), the Division of Advice concluded that the NLRB should dismiss a charge directed at a policy that stated:

No manager, supervisor, or employee at Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will. Only the president of the Company has the authority to make any such agreement and then only in writing.

The Division of Advice concluded that this language did not restrict an employee's Section 7 rights because it explicitly allows the company president to enter into written agreements that modify the at-will relationship, and, therefore, modification of the at-will relationship was still possible through collective efforts.

Similarly, in SWH Corporation (Mimi's Cafe), No. 28-CA-084365 (October 31, 2012), the Division of Advice concluded that the NLRB should dismiss a charge directed at a policy that stated: "No representative of the Company has authority to enter into any agreement contrary to the foregoing employment at will relationship." The Division of Advice explained that the policy restricted only company representatives from modifying the at-will relationship. The policy did not require employees to refrain from seeking a change in the at-will status or to agree that their at-will status could not be changed.

Employers should, of course, continue to include an at-will statement in handbooks to inform employees that employment is, in fact, at-will. The NLRB continues to assert that an employer's at-will statement must not state, without any qualification, that an employee's at-will status cannot be changed. In light of NLRB's position, and given the increased scrutiny by NLRB, employers should review the at-will statements in employee handbooks and other policies to ensure compliance with the NLRA.

Asking Employees to Maintain Confidentiality During an Internal Investigation

Union and nonunion employers conducting internal investigations regularly ask employees keep the matter confidential and to not discuss the investigation with others. The Banner Health System decision in July 2012 - in which the NLRB concluded that an employer's request to an employee to keep an internal matter confidential violated an employee's Section 7 rights - has changed the landscape concerning this common workplace practice.

In Banner Health System, 358 NLRB No. 93 (July 30, 2012), an Arizona hospital investigated an employee's complaint about the instructions his managers gave him concerning the procedures for the sterilization of medical devices. In conducting the investigation, the hospital's human resources consultant asked the employee to refrain from discussing the matter with his co-workers while the hospital conducted the investigation. The statement concerning confidentiality was part of the hospital's standard "Introduction for all Interviews" instructions.   

The Board concluded that the hospital's statement about confidentiality was an unlawful restraint on the employee's Section 7 rights. It stated that "to justify a prohibition on employee discussion of ongoing investigations, an employer must show that it has a legitimate business justification that outweighs employees' Section 7 rights." The Board also said that prohibiting employees from discussing subjects such as internal investigations would have the effect of preventing employees from engaging in concerted activity, and violate Section 7, unless the employer could show that confidentiality was required on the specific facts of the investigation. The Board further concluded that an employer's "blanket justification" such as "protecting the integrity of the investigation" was insufficient. Instead, according to the Board, the employer bears the burden "to first determine whether in any given investigation witnesses needed protection, evidence was in danger of being destroyed, testimony was in danger of being fabricated, or there was a need to prevent a cover up." The Board concluded that those issues were not present in this case.

The NLRB's decision highlights the importance for employers to assess - on an investigation-by-investigation basis - the justifications for confidentiality and the specific language used to ask employees to maintain confidentiality. Employers should review policies and procedures regarding statements given during investigations to ensure that any statements about confidentiality are consistent with the NLRA. Employers also should consider training human resource managers who regularly conduct internal investigations on this and other important aspects of conducting an effective internal investigation.

Challenges to Employee Arbitration Agreements

The NLRB has challenged arbitration agreements that require an employee to give up the right to bring employment-related claims against the employer on collective or class basis in any forum, arbitral or judicial. In D.R. Horton, Inc.,357 NLRB No. 184 (January 3, 2012), the Board concluded that the employer violated Section 7 when it required employees, as a condition of employment, to sign an arbitration agreement in which the employees agreed to forgo class and collective actions both in arbitration and in the courts. The Board reasoned that "employees who join together to bring employment-related claims on a classwide or collective basis in court or before an arbitrator are exercising rights protected by Section 7 of the NLRA." It stated: "[E]mployers may not compel employees to waive their NLRA rights to collectively pursue litigation of employment claims in all forums, arbitral and judicial." (Emphasis in original). The Board concluded that the employer's mandatory arbitration agreement violated the NLRA. The decision has been appealed and is pending before the U.S. Court of Appeals for the Fifth Circuit.

The Board also concluded that this type of arbitration provision is unlawful even when an employee has the ability to opt-out of the arbitration policy. In 24 Hour Fitness USA, Inc., NLRB ALJ, No. 20-CA-35419 (NLRB ALJ Nov. 6, 2012), an NLRB administrative law judge ruled that the employer's arbitration policy violated the NLRA because it required new hires to agree to never proceed against the employer in class or collective actions in court or in arbitration. In that case, the employer argued that the arbitration policy was voluntary - not mandatory - because the employer gave the employee the opportunity to opt-out of the arbitration policy by notifying the employer within 30 days after agreeing to the arbitration policy. The judge rejected the employer's argument and, relying on the NLRB's decision in D.H. Horton, concluded that the employer's arbitration policy violated the NLRA. This decision is on appeal to the NLRB.

The NLRB has also stated that it will find unlawful any arbitration policy that does not expressly and clearly inform employees that the arbitration obligation does not prevent them from filing claims with the NLRB. According to the Board, the arbitration policy must specifically reference the employee's continued right to file a charge with the NLRB.

Off-Duty Employee Access to Workplaces

The NLRB has also further limited an employer's ability to keep off-duty employees off the employer's property. The NLRB's long-held position is that a policy prohibiting all access to the employer's premises by off-duty employees is presumptively unlawful. A rule that denies off-duty employees access to an employer's parking lots and other outside non-working areas is generally found invalid, unless the employer has a specific business reason for the exclusion. To be valid, an off-duty access policy must: (1) limit prohibited access only to the interior of the employer's buildings and other working areas; (2) be clearly disseminated to all employees; and (3) apply to off-duty employees seeking access for any purpose and not just those employees seeking access to engage in union activities.

In Sodexo America LLC, 358 NLRB No. 79 (July 3, 2012), the NLRB found unlawful an employer rule that prohibited off-duty employees from entering the workplace except to conduct "hospital-related business." The Board concluded that the "hospital-related business"'exception allowed the employer "unlimited discretion to decide when and why employee may access the facility." The Board concluded that because the employer had "free reign to set the terms of off-duty employee access," the policy restricted the employees' Section 7 rights. The NLRB's decision serves as a reminder to all employers concerning policies and practices that restrict off-duty employee access.

Union's Ability to Organize by Micro-Units (Single Departments or Job Description)

The Board recently ruled that employees performing the same job in a single facility can organize separately from the remaining employees in that facility. For example, in The Neiman Marcus Group, Inc., 02-RC-076954 (May 4, 2012),a Regional Director (Region 2) ruled that the employees in the women's shoe department at Bergdorf Goodman's could organize separate from all other store employees. As a result, this could mean that employees in one department of a full-line store would likely be able to unionize as a separate group. This could allow a union to "get its foot in the door" and later organize the rest of the store. Employers that are vulnerable to this strategy of micro-unit organizing should consider revising job descriptions and consider cross-training and transfers between departments to limit the risk of organizing.

Other Issues: Websites, Posters and Quickie Elections

The NLRB remains active in other areas relevant to union and nonunion employers. The following are some examples:

New Website. In 2012, the NLRB launched a website designed to inform nonunion employees of their rights under the NLRA. The Board's focus in launching the website is to reach and educate nonunion employees about their right to unionize and to engage in protected concerted activity under the NLRA. In addition, the NLRB plans to distribute educational brochures containing examples of unlawful employer conduct that have arisen in past and current cases before the Board.

NLRB Poster. In August 2011, the NLRB issued a rule requiring most private-sector employers (union and nonunion) to post a notice advising employees of their rights under the NLRA. The rule was scheduled to go into effect in April 2012. In 2011 and 2012, business groups brought legal challenges, and cases are now pending in the U.S. Courts of Appeals for the Fourth Circuit and the District of Columbia. The NLRB has announced that it will not implement the rule until these legal challenges are decided.

"Quickie Elections." In late 2011, the NLRB adopted rule changes that may result in "hurry-up" union elections (within 21-30 days, instead of the current 38-42 days). These changes took effect April 30, 2012, but were blocked by the United States District Court for the District of Columbia in May 2012. That decision is on appeal in the United States Court of Appeals for the District of Columbia. Because the court's decision was based only on a conclusion that the NLRB followed an improper procedure in adopting the rule, the NLRB will likely reissue the rules in 2013.


The NLRB continues to scrutinize the policies and practices of union and nonunion employers. The NLRB's positions on social media, at-will statements, and management's statements to employees during investigations highlight the critical need for employers to evaluate how employment policies and practices may affect an employee's Section 7 right to engage in protected concerted activity. The NLRB's actions in 2012 serve as a reminder to employers to develop compliant policies and practices, and to effectively train managers who carry out those policies and procedures.


1. The NLRB also issued a report in August 2011.

2. The January 2012 report can be found at: http://www.nlrb.gov/news/acting-general-counsel-issues-second-social-media-report

3. The May 2012 report can be found at: http://www.nlrb.gov/news/acting-general-counsel-releases-report-employer-social-media-policies


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.

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