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Employer's Code of Conduct Does Not Impermissibly Restrict Employees' Section 7 Rights: NLRB General Counsel's Office
Practical Law Legal Update 2-524-8288 (Approx. 5 pages)
Employer's Code of Conduct Does Not Impermissibly Restrict Employees' Section 7 Rights: NLRB General Counsel's Office
by PLC Labor & Employment
| Published on 05 Mar 2013 • USA (National/Federal) |
The National Labor Relations Board (NLRB) released an advice memorandum clarifying when language in an employer's standards of conduct policy does not impermissibly restrict its employees' rights under Section 7 of the National Labor Relations Act (NLRA).
On February 28, 2013, the NLRB's General Counsel released an advice memorandum regarding The Boeing Company's standards of conduct policy. The Division of Advice found that the "Code of Conduct" contained in the policy did not interfere with Boeing employees' Section 7 rights, because employees would not reasonably construe its potentially overbroad language to restrict protected concerted activities, in the context of the almost 40 pages of explanations and examples included in the policy.
Boeing maintains "Ethical Business Conduct Guidelines," a 43-page manual implemented in response to a procurement scandal by former Boeing employees. The Ethical Guidelines include a one-page preamble, the "Code of Conduct," and detailed explanations and examples of Boeing's business ethics policies. Boeing presents, distributes and discusses its Ethical Guidelines at a mandatory day-long training program for all new employees, at which both Boeing and union representatives are present. Employees must reaffirm their adherence to the Code of Conduct annually as a condition of employment. After an unfair labor practice (ULP) charge was brought that the Code of Conduct violated the NLRA, the Region submitted the case for advice regarding the Code's lawfulness.
The sections of the Code of Conduct at issue are:
Employees will not engage in conduct or activity that may raise questions as to the company's honesty, impartiality, reputation or otherwise cause embarrassment to the company.
The Division of Advice found that Boeing employees would not reasonably construe this language to restrict Section 7 activities when viewed in the context of the Ethical Guidelines, which included numerous examples of unprotected activities that could undermine Boeing's "honesty, impartiality, reputation," or otherwise embarrass the company.
[As a Boeing employee,] I will not engage in any activity that might create a conflict of interest for me or the company.
Again, in the context of the Ethical Guidelines, the Division of Advice found that this prohibition would not reasonably be interpreted to restrict Section 7 activities. The Ethical Guidelines includes two pages of examples of the types of conflicts of interest Boeing requires employees to avoid, including outside employment with or a significant financial interest in a customer, supplier or competitor.
[As a Boeing employee,] I will follow all restrictions on 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.
[As a Boeing employee,] I will protect all company, customer and supplier assets and use them only for appropriate company-approved activities.
The Division of Advice found that these two prohibitions were lawful restrictions on employees' use of certain proprietary information. The language does not specifically reference and restrict information concerning employees and their jobs, and when read in context with the Ethical Guidelines policy on the proper use of company, customer and supplier resources, employees would reasonably understand that these prohibitions reflect Boeing's concerns about employee use of Boeing's property, rather than Section 7 communications.
The Division of Advice also noted that although a union's presence at new employee orientations cannot necessarily save an overbroad or ambiguous policy from being found unlawful, in this case the fact that union representatives are present when the Code of Conduct is presented to new employees would lead employees to believe that restrictions on the use of Boeing assets and information do not extend to employee communications with union representatives.
Finally, the Division of Advice found that a statement on the Ethical Guidelines website's "Frequently Asked Questions" section, indicating that the Code of Conduct does not apply to employees' "constitutional, statutory, or other protected rights," also supported the Division's finding that employees would not reasonably believe Boeing's Code of Conduct restricted their Section 7 or union activities.
Although this advice memorandum is not binding precedent on the panel (Board) heading the judicial functions of the NLRB, the memorandum specifies that:
- Rules or standards of conduct that are ambiguous as to their application to Section 7 activity and do not contain limiting language or context that clarify to employees they do not apply to Section 7 activity are unlawful. The NLRB's General Counsel therefore endorses NLRB regional directors issuing ULP complaints and, where appropriate, litigating these complaints before NLRB administrative law judges and the Board.
- Rules or standards that clarify and restrict their scope by including clear examples of illegal or unprotected conduct such that they could not reasonably be construed to cover protected activity are not unlawful. The NLRB's General Counsel encourages NLRB regional directors to dismiss charges about these types of rules.
In light of this memorandum, employers should ensure that any standards of conduct policies they current have contain sufficient examples to clarify that restricted activity does not cover protected activities under the NLRA.