Well, that didn't take long. A mere day after our post about possible changes from the new NLRB, the Board has announced two major rule reversals.
The second case announced, as will surprise exactly no one, reverses the NLRB's Browning-Ferris decision on joint employer status. In Hy-Brand Industrial, the NLRB returned to the pre-Browning standard, under which joint employment is found only if actual control is exercised in a "direct and immediate" manner that is not limited or routine. You can see our previous coverage of the standards here. This has been a major issue for many employers, such as franchise businesses, and the subject of a lot of activity in Congress, so this move was expected.
The first case announced reversed a 2004 decision, Lutheran Heritage, which concluded that an employer's facially neutral workplace rule will be unlawful if employees would reasonably construe it as prohibiting the exercise of NLRA, Section 7 rights. Under the new case, The Boeing Co., the NLRB will only find facially neutral rules to be unlawful by weighing the nature and extent of the potential impact of the rule on NLRA rights, and the employer's legitimate justifications for implementing the rule. The Board also emphasized that an otherwise lawful rule could still be applied in an unlawful fashion. To provide more clarity, the Board is establishing three categories; according to the NLRB announcement:
• Category 1 will include rules that the Board designates as lawful to maintain, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule. Examples of Category 1 rules are the no-camera requirement maintained by Boeing, and rules requiring employees to abide by basic standards of civility. Thus, the Board overruled past cases in which the Board held that employers violated the NLRA by maintaining rules requiring employees to foster “harmonious interactions and relationships” or to maintain basic standards of civility in the workplace.
• Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.
• Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule. An example would be a rule that prohibits employees from discussing wages or benefits with one another.
The fact that the NLRB's first rule change was to flip a Bush-era NLRB further underscores my observation of a Board that intends to be quite aggressive. Maybe I'm reading too much into all of this, but the Boeing decision and its timing hit with a wallop and I think we're going to have to buckle our seatbelts for this Board, as a lot of big changes may be afoot.