Friday, August 10, 2012

NLRB Holds Employer's At-Will Section of Handbook Violates NLRA

In a potentially ground-breaking case, an administrative law judge for the National Labor Relations Board (NLRB) has held that an ‘at-will employment clause’ which was part of a non-unionized employer’s employee handbook acknowledgment page violates Section 7 of the National Labor Relations Act (NLRA).  The decision appears to be a first of its kind.

The language specifically held unlawful under the NLRA read:
"I further agree that the at-will employment relationship cannot be amended, modified or altered in any way."
In finding the language unlawful, the ALJ stated that this language violates Section 7 by making it sound as if it is impossible for employees to collectively bargain (i.e., bring in a union) so as to enter into a collective bargaining agreement with the employer.  The decision came in American Red Cross Arizona Blood Services Division and the ALJ was somewhat cautious in his opinion given the controversial holding.

The ALJacknowledged that it was questionable whether the language expressly restricted Section 7 activity, but held that there was “no doubt” that it violated the Act because employees would reasonably construe the language to prohibit Section 7 activity. Specifically, the ALJ reasoned that by signing the form the employee waived her right to individually attempt to change her at-will status. The language, however, could be interpreted by employees as also waiving the right to engage in concerted activity in an attempt to change that status. For these reasons, the ALJ concluded that the acknowledgement form contained “overly-broad and discriminatory language that had a chilling effect on the employee’s Section 7 rights,” and violated the NLRA. The American Red Cross was ordered to remove or revise the language, notify all employees in writing that the provision had been revised or rescinded, and post a notice advising employees of their rights under the NLRA, and assuring them it would respect those rights.
Either way, this is a very important holding as it is common in most workplaces for employer's to have similar written policies regarding at-will employment.  There is a need for more guidance so perhaps the NLRB's General Counsel will issue such after a few more cases go through the pipeline, should anymore be forthcoming.

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