NLRB May Not Be Satisfied by Express Disclaimers Protecting Section 7 Rights

Stephen R. McCutcheon, Jr., Attorney at Law

Employers prepare employee handbooks and their employment policies to state the company’s position on important legal issues, and inform employees of company policies and procedures. There are a variety of employment policies that may impact rights protected under the NLRA, including policies regarding arbitration of claims, class actions, confidentiality of employee and customer information, and social media.

The drafting of handbooks and policies requires careful balancing to avoid being over- and under-inclusive. The goal of such policies is to minimize risk and avoid litigation. In regard to the National Labor Relations Act, this goal is becoming increasingly difficult to achieve due to often unreasonable and extreme interpretations of employer policies adopted by administrative law judges and the National Labor Relations Board.

To address the concern about being over-inclusive, employers typically include language to carve out rights, claims, or matters that are not covered by the agreement. Such language might state that the handbook provision or employer policy applies “to the extent permitted by law” or “shall not be interpreted to apply to employee rights protected by Section 7 of the National Labor Relations Act.” With the current Board, this may not be enough to avoid a charge.

The language of a handbook provision or employment policy must be read as a whole, and care must be taken to ensure that a policy cannot be interpreted to run afoul of the NLRA. Take the recent administrative law judge’s decision in Labor Ready Southwest, Inc., Case 31-CA-072914, regarding Labor Ready’s arbitration provision. Labor Ready’s arbitration stated:

I agree that any disputes arising out of my application for employment or employment that I believe I have against Labor Ready or its agents or representatives, including, but not limited to, any claims related to wage and hour laws, discrimination, harassment or wrongful termination, and all other employment related issues (excepting only actions arising under the NLRA) will be resolved by final and binding arbitration under the Federal Arbitration Act. Except where prohibited by law, I agree to bring any disputes I may have as an individual and I waive any right to bring or join a class, collective, or representative action.

In spite of the express carve out, unambiguously stating that the provision excepted “actions arising under the NLRA” the judge found this provision unlawful because “other language” (i.e., the very next sentence of the provision) stating the provision applied “except where prohibited by law” created ambiguity dissuading employees from presenting charges under the NLRA, and restricted collective access to the Board and its processes.

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