Employer Did not Repudiate Overbroad Social Media and Dress Code Policies: NLRB | Practical Law

Employer Did not Repudiate Overbroad Social Media and Dress Code Policies: NLRB | Practical Law

In Boch Imports, Inc. (Boch Honda), the National Labor Relations Board (NLRB) held that an employer failed to effectively repudiate unlawful social media and dress code policies in its employee handbook even though it worked with an NLRB regional office to revise the social media policy and other policies to comply with the National Labor Relations Act (NLRA) before issuing a new handbook. The employer continued to be liable for the former handbook's terms and for failing to demonstrate special circumstances justifying a prohibition on employees wearing pins and clothing with insignia or messages.

Employer Did not Repudiate Overbroad Social Media and Dress Code Policies: NLRB

Practical Law Legal Update 8-611-4685 (Approx. 7 pages)

Employer Did not Repudiate Overbroad Social Media and Dress Code Policies: NLRB

by Practical Law Labor & Employment
Law stated as of 17 Jun 2016 • USA (National/Federal)
In Boch Imports, Inc. (Boch Honda), the National Labor Relations Board (NLRB) held that an employer failed to effectively repudiate unlawful social media and dress code policies in its employee handbook even though it worked with an NLRB regional office to revise the social media policy and other policies to comply with the National Labor Relations Act (NLRA) before issuing a new handbook. The employer continued to be liable for the former handbook's terms and for failing to demonstrate special circumstances justifying a prohibition on employees wearing pins and clothing with insignia or messages.
On April 30, 2015, in Boch Imports, Inc. (Boch Honda), a majority of a three-member delegation of the panel (Board) heading the NLRB's judicial functions held that the employer's social media and dress code policies in its employee handbook were unlawfully overbroad under the NLRA. The Board majority also found that the employer failed to effectively repudiate the invalid policies by issuing a new handbook with revised policies drafted with the assistance and approval of NLRB regional office personnel, and that the employer failed to demonstrate special circumstances justifying a prohibition on employees wearing pins. (362 N.L.R.B. slip op. 83 (Apr. 30, 2015).)

Background

The employer, an owner of car dealerships, issued an employee handbook in 2010. The handbook included a dress code policy stating:
Employees who have contact with the public may not wear pins, insignias, or other message clothing which are not provided to them by the Company.
The handbook also included a social media policy that prohibited employees from:
  • Disclosing any information about employees or customers.
  • Referring to the employer in social media postings in a manner that would negatively impact the employer’s reputation or brand.
  • Engaging in activities that could have a negative effect on the employer, even if the activities occurred off the employer's property or occurred during on-working time.
  • Using Respondent’s logos for any reason.
  • Posting videos or photos that are recorded in the work place.
The employer's social media policy also required employees to:
  • Provide the employer with access to any commentary posted by employees on social media sites.
  • Identify themselves when posting comments about the employer or related to the employer’s business or "a policy issue."
After a local Machinists union filed unfair labor practice (ULP) charges challenging the employer's social media policy and several other policies in the 2010 handbook, the employer worked with NLRB regional office personnel to revise those policies and issue a new handbook in 2013. The 2013 handbook included a revised social media policy and a slightly revised dress code policy, the latter which read:
Employees who have contact with the public may not wear pins, insignias, or other message clothing.
Later ULP charges continued to challenge the social media policy (and several other policies) in the 2010 handbook for the periods they were effective and the dress code policy in both the 2010 and 2013 handbooks. An NLRB administrative law judge (ALJ) found that the social media policy and dress code policy (both versions) were unlawfully overbroad, except for the dress code policy's pin prohibition, which the ALJ found was justified by special business-related circumstances. The ALJ also found that the employer failed to repudiate the invalid policies in the 2010 handbook by issuing the 2013 handbook. The employer excepted to the ALJ's finding that it did not sufficiently repudiate the 2010 handbook policies he found invalid. The employer did not except to the ALJ's finding that the 2010 handbook policies were unlawful, asserting that the issue was moot given its effective repudiation of the handbook. The NLRB's General Counsel cross-excepted to the ALJ's decision upholding the pin prohibition.

Outcome

The Board (Chairman Pearce and Members Hirozawa and Johnson) unanimously held that:
  • Under governing precedent, the employer failed to show there were special circumstances justifying its 2013 dress code prohibition of wearing insignia or message clothing because that prohibition:
    • interfered with employees' Section 7 right to wear union insignia (P.S.K. Supermarkets, 349 N.L.R.B. 34 (2007)); and
    • was not narrowly tailored to justify the employer's claimed special circumstance of maintaining its public image.
The Board majority (Chairman Pearce and Member Hirozawa) held that:
  • The employer's 2010 social media policy was unlawfully overbroad because:
  • The portion of the employer's 2010 dress code policy prohibiting employees from wearing insignias and message clothing violated Section 8(a)(1) for the same reasons the 2013 policy was invalid.
  • The portion of the employer's 2010 and 2013 dress code policy prohibiting employees from wearing pins violated Section 8(a)(1) because the prohibition was not narrowly tailored to justify the employer's claimed special circumstances of preventing injury to employees and damage to vehicles. The majority noted that:
    • the rule applied to finance and administrative employees who did not work on vehicles and therefore would not be at risk for injury by a pin or to inadvertently damage a vehicle with a pin;
    • the employer had failed to provide any evidence supporting actual safety concerns or showing that vehicles had been damaged by pins worn by employees; and
    • the rule did not include any statement linking it to safety considerations.
  • The employer did not effectively repudiate the unlawful policies in its 2010 handbook by issuing the 2013 handbook containing the social media and other policies revised with the NLRB regional office's assistance and approval. The employer did not notify its employees of the ULPs and did not assure employees that it would not interfere with their Section 7 rights in the future (Lily Transp. Corp., 362 N.L.R.B. slip op. 54 (Mar. 30, 2015); River's Bend Health and Rehab. Servs., 350 N.L.R.B. 184 (2007)).
  • Because the employer failed to sufficiently rescind the unlawful 2010 policies and repudiate maintaining them for a period lasting more than two years, it was liable for maintaining its unlawful 2010 handbook policies. Those policies' uncontested overbreadth was therefore relevant.
Member Johnson dissented in part, finding that:
  • The employer effectively repudiated its unlawful 2010 handbook policies because it cooperated with the NLRB regional office on revising and re-issuing the handbook. According to Member Johnson:
  • The dress code policy's prohibition on wearing pins was justified by special circumstances, including the likelihood that pins worn by employees could damage vehicles.
  • The Board should reconsider its precedent on what constitutes special circumstances for dress codes tied to employers' branding or messaging to customers.

Practical Implications

The Board's decision in Boch Honda illustrates that the Board will continue to strictly apply Passavant's standards for a valid repudiation even against employers that cooperate extensively with NLRB regional offices to revise objectionable policies. For a repudiation to serve as a defense to a ULP charge, it must be:
  • Timely.
  • Unambiguous.
  • Specific in nature, explaining its intent to eliminate particular coercive conduct (or coercive policy language).
  • Untainted by other unlawful conduct.
  • Adequately published with assurances to employees that the employer will not interfere with Section 7 rights.
(237 N.L.R.B. 138 (1978).)
The Board also tends to require that the employer admit wrongdoing (see Ark Las Vegas Restaurant Corp. v. NLRB, 334 F.3d 99 (D.C. Cir. 2003)).
The Board continues to pan social media policies that:
  • Require employees to identify themselves before posting on social media sites.
  • Include broad prohibitions on social media activity but lack context, examples or disclaimers stating that the prohibitions are not intended to prohibit Section 7 activity.
The Board majority continues to closely scrutinize prohibitions on wearing pins, buttons or items that display messages or insignias unless employers:
  • Narrowly tailor the policy to address special circumstances, such as employee safety, protection of employer equipment or products the employer's need to protect its image and justify the prohibition with extensive evidence that those circumstances are important to employer business interests.
  • Have supporting evidence for the special circumstances on which they rely. The Board tends to look for discussions of those circumstances in the policy or elsewhere in the employee handbook, pointing out that employees would tend to infer that restrictive dress or appearance policies exist to restrict Section 7 activity without justification.
Employers should continue looking to the General Counsel's recent guidance on the issue of social media and other policies (see Legal Update, NLRB General Counsel Red Flags Common Terms in Employment Rules).
UPDATE: On June 17, 2016, in Boch Imports, Inc. v. NLRB, the US Court of Appeals for the First Circuit:
  • Granted the Board's petition for enforcement of its order and denied the employer's petition for review.
  • Found that the Board's rulings were:
    • supported by substantial evidence; and
    • not arbitrary and capricious.
( (Jun. 17, 2016).)