United States: NLRB Pulls Back A Little More On Policy Frenzy, Finds Code Of Conduct Does Not Violate The Act

As we have seen repeatedly in the last year, the NLRB has taken it upon itself to police employer policies often finding a phrase or two to be a violation of the Act.In recent months we have seen the NLRB seemingly pullback on this trend, taking a much closer look at the context of the language.

The NLRB released another clue as to how it is looking at employer policies in a recently released Advice Memorandum.In The Boeing Company, 19-CA-088157, Advice Memorandum (February 28, 2013), the NLRB's Division of Advice found that the employer's "Code of Ethics" did not violate Section 8(a)(1) of the Act, "because employees would not reasonably construe its potentially overbroad language to restrict protected concerted activities, in the context of the almost forty pages of explanations and examples immediately following the Code."

The language at issue

The portions of the Code of Conduct that were alleged to be unlawful were as follows:

Employees will not engage in conduct or activity that may raise questions as to the company's honesty, impartiality, reputation or otherwase cause embarrassment to the company.

and further:

As an employee of [Employer], I will ensure that:

I will not engage in any activities that might create a conflict of interest for me or the company.

I will follow all restrictions on the use and disclosure of information.This includes following all requirements for protecting [Employer] information and ensuring that non-Boeing proprietary information is used and disclosed only as authorized by the owner of the information or as otherwise permitted by law.

I will protect all company customer and supplier assets and use them only for appropriate company pre-approved activities.

The employer's employees, who largely are represented by a union, are required to attend a day-long orientation program.Both employer and union representatives attend the session to answer questions.The policy also contains many pages of examples and frequently asked questions.

Advice evaluated each of the statements at issue in light of the tests set forth in Lafayette Park Hotel, 326 NLRB 824, 825 (1998), enf'd mem. 203 F.3d 52 (DC Cir. 1999) and Lutheran Heritage Village-Livonia, 343 NLRB 646, 646-7 (2004), noting specifically that the Board has "cautioned against reading particular phrases in isolation" and urging a view of the rule in its proper context. Id.

As to the policy's prohibition of conduct "that may raise questions as to the company's honesty, impartiality, reputation or otherwise cause embarrassment" Advice concluded the phrase was not unlawful because it must be viewed in the broader context of the guidelines.Advice stated:

The Ethical Guidelines describes numerous activities that could undermine the Employer's 'honesty, impartiality, reputation' or otherwise 'cause embarrassment,' including bribery, antitrust violations, insider trading and offering and accepting certain 'business courtesies' regarding commercial customers and government employees–activities which clearly do not implicate activities protected by Section 7.

Similarly, the prohibition against engaging in activities that may cause a "conflict of interest" was not unlawful because the accompanying Ethical Guidelines "devotes two pages of the types of conflicts of interests the Employer" wishes to avoid and consequently, "it is neither overbroad or ambiguous."

Finally, the prohibition of using certain company information likewise was found to be lawful because:

Employees would not reasonably construe this language, in context, in restricting Section 7 activities such as discussing wages and other terms and conditions of employment with other employees or union representatives.Thus, the confidentiality language does not specifically reference and restrict information concerning and their jobs.

Advice gave some consideration to the fact that the employees were represented by a union:

Additionally, the fact that the Union is present at the employee orientations where the policy is presented would also lead employees to believe that restrictions on the use of Employer assets and information would not extend to employee communications with their employee representatives.

The major takeaway here is similar to the General Counsel's guidance on social media. The more specific the policy is aimed at the conduct it wishes to regulate, the more likely it will be found to be lawful.Of course, the presence of the union at the workplace is a factor here but as we have seen previously, the Board has found violations in a handbook despite union representation.

www.proskauer.com

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