National Labor Relations Board Carefully Examines At-Will Employment Clauses in Employee Handbooks

In addition to its extensive scrutiny of social media policies, the National Labor Relations Board (“NLRB”) has been focusing recently on at-will employment clauses contained in employee handbooks. Recent NLRB decisions indicate a tendency by the NLRB to find that a policy including broad limitations on the ability to alter the at-will employment status violates the National Labor Relations Act (“NLRA”) if it could be interpreted as restricting an employee’s ability to unionize or collectively bargain in order to alter their employment status.

The Relationship between At-Will Disclaimers and Protected Activities under the NLRA

Section 7 of the NLRA provides employees, whether unionized or not, with several rights, including the rights to “bargain collectively through representatives of their own choosing” and to “engage in other concerted activities for a purpose of collective bargaining or other mutual aid or protection[.]” An at-will employment policy which imposes broad limitations on an employee’s ability to alter their employment status may be interpreted by the NLRB as restricting employees’ rights and, therefore, violating the NLRA.

Recent NLRB Decisions Regarding At-Will Disclaimers

In American Red Cross Arizona, Case No. 28-CA-23443, the NLRB determined that the employer’s at-will provision, which stated that the “at-will relationship cannot be amended, modified or altered in any way” violated the NLRA as employees could reasonably interpret it to prohibit them from making any efforts to unionize or enter a collective bargaining agreement for purposes of altering the at-will relationship.

Similarly, in NLRB v. Hyatt Hotel Corp., 28 CA-061114, the NLRB recently challenged an at-will clause in employee handbooks distributed by Hyatt Hotels Corporation. Specifically, the provision stated that

“no oral or written representations regarding my employment can alter my at-will employment status, except for a written statement signed by me and either Hyatt’s Executive Vice-President/Chief Operating Officer or Hyatt’s President.”

Again, this at-will employment disclaimer was challenged on the grounds that it could be construed by employees as prohibiting their right to join together for the purpose of negotiating a change to their at-will status.

Why is This Trend Important to My Company?

Regardless of whether employees are unionized, the NLRB has the authority to challenge an employer’s policies and procedures as non-union employees also have a right under Section 7 to engage in protected concerted activities. The decisions described above make it clear that the NLRB is scrutinizing various clauses contained in employee handbooks, including at-will disclaimers.

If your organization currently distributes an employee handbook that includes provisions seeking to govern the at-will employment relationship, please contact Leech Tishman’s Employment Practice Group to discuss how your policies may need to be restructured in order to achieve your organization’s goals while at the same time comply with the NLRA and other federal, state and local laws.

Please feel free to contact the Employment Group with any questions your organization may have regarding employee handbooks and at-will disclaimers, or any other employment law issue.

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