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Has the Board Outlawed Codes of Conduct? Not Yet!

The National Labor Relations Board (“Board”) continues to focus on policies restricting employee behavior relating to an employer’s image and reputation.  The Board issued an Advice Memorandum on February 28, 2013, stating that Boeing’s 43-page Code of Conduct (“Code”) within its Ethical Guidelines did not violate employee’s rights under Section 7 of the National Labor Relations Act (“Act”).  Section 7 of the Act protects the “concerted activities” of employees for the purposes of collective bargaining or other “mutual aid or protection.”  The Board reasoned that employees would not reasonably construe the Code’s “potentially overbroad language to restrict protected concerted activities, in the context of the almost forty pages of explanation and examples immediately following the Code.”

The analysis the Board used is the same that it used last year to evaluate social media use policies, “courtesy” policies, and other policies.  An employer violates the Act if a workrule or policy would “reasonably tend to chill employees in the exercise of their Section 7 rights” in one of two ways.  First, a workrule or policy is unlawful if it explicitly restricts Section 7 activities. Second, if the workrule or policy does not explicitly restrict Section 7 rights, it is still unlawful if: (1) employees would reasonably construe the language to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7 rights (e.g., if it “chills” Section 7 rights).

In the past year, the Board has been particularly focused on social media policies and “courtesy” rules, declaring many of them unlawful for chilling Section 7 rights.  In two cases decided last year, the Board offered guidance on social media policies.  In both cases, the Board struck down language broadly prohibiting disrespect toward the Company, its image and reputation.  Remember that the Board decisions mentioned are likely to be invalidated under Noel Canning, a case decided by the D.C. Circuit Court that held the appointments of three Board members last year were invalid.  Noel Canning will be appealed to the Supreme Court.  The likely outcome for Board cases decided last year is that a properly constituted Board will uphold these decisions.

In this case, Boeing had a Code of Conduct within its Ethics Guidelines with various broad statements including “[e]mployees 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 Code set out Boeing’s eleven business ethics policies followed by twenty pages of examples.

The Board was persuaded that this lengthy policy could not be reasonably construed to restrict Section 7 rights in part because the Code is presented, distributed and discussed at a mandatory day-long training orientation program for new hires where a union representative is present.  Also, the employees must reaffirm their adherence to the code yearly.  The length of the Code, including twenty pages of examples of illegal and unprotected activities, helped to clarify, restrict, and give context to the rules.  The Board noted there was an explicit statement in the “frequently asked questions” on-line that said employees’ protected rights were not affected by the Code.

This case suggests that more may be better when it comes to these kinds of policies regarding employee behavior.  Employers who have social media use policies, “courtesy” policies, and codes of conduct, should consider including examples and explanations in their policies, an explicit statement that the policy does not affect employee’s statutory rights, and consider having those policies reviewed by legal counsel to ensure compliance with the law.

Brody and Associates regularly advises its clients on union-related matters and provides union-free training.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.965.0560.