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At-will Employment Policies Do Not Violate the NLRA: NLRB General Counsel's Office
Practical Law Legal Update 2-522-2250 (Approx. 5 pages)
At-will Employment Policies Do Not Violate the NLRA: NLRB General Counsel's Office
by PLC Labor & Employment
| Published on 02 Nov 2012 • USA (National/Federal) |
Two advice memoranda from the General Counsel's Office of the National Labor Relations Board (NLRB) found that at-will employment policies did not violate the National Labor Relations Act (NLRA). In Rocha Transportation and Mimi's Café, the General Counsel's Office found that employees could not reasonably construe the at-will employment language to restrict their Section 7 rights.
Two October 31, 2012 advice memoranda from the NLRB's General Counsel's office, which heads the NLRB's prosecutorial functions, clarified that not all at-will employment policies violate Section 8(a)(1) of the NLRA. In each advice memorandum, the NLRB's associate general counsel recommended dismissal of the charging party's allegations that the employer's at-will policy violates the NLRA, finding that employees could not reasonably construe the at-will employment language to restrict their Section 7 rights.
Mimi's Café At-will Employment Policy
In Mimi's Café, the employer required all new employees to sign for and receive a copy of a Teammate Handbook, which includes an employment at-will policy stating:
"The relationship between you and Mimi's Café is referred to as "employment at will." This means that your employment can be terminated at any time for any reason, with or without cause, with or without notice, by you or the Company. No representative of the Company has authority to enter into any agreement contrary to the foregoing "'employment at will" relationship. Nothing contained in this handbook creates an express or implied contract of employment."
The charging party alleged that the language restricting company representatives from entering into any agreement contrary to the at-will employment relationship violates Section 8(a)(1) of the NLRA because it is overbroad and would reasonably chill employees' exercise of their Section 7 rights to select union representation and engage in collective bargaining.
Rocha Transportation At-will Employment Policy
In Rocha Transportation, all new employees received a copy of the Rocha Transportation Driver Handbook, which contains a "Statement of At-Will Employment Status" stating:
"Employment with Rocha Transportation is employment at-will. Employment at-will may be terminated with or without cause and with or without notice at any time by the employee of the Company. Nothing in this Handbook or in any document or statement shall limit the right to terminate employment at-will. No manager, supervisor, or employee of Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will. Only the president of the Company has the authority to make any such agreement and then only in writing."
In addition, the Handbook contains an acknowledgment of receipt that employees were required to sign which reiterates part of the at-will employment policy and clarifies that:
"Nothing in the employee handbook creates or is intended to create a promise, contract, or representation of continued employment ..."
The charging party alleged that this at-will language violates Section 8(a)(1) because it is overbroad and would reasonably chill employees' exercise of their Section 7 rights.
Advice Memoranda Analysis and Conclusions
Both cases were submitted to the General Counsel's office for advice about whether these at-will policies violate Section 8(a)(1) of the NLRA. In two separate but similar advice memoranda (Mimi's Café and Rocha Transportation), the associate general counsel concluded that the contested at-will policies:
- Do not explicitly restrict employees' Section 7 activity.
- Were not set out in response to union activity or other protected activity and have not been applied to restrict protected activity.
- Read in context, would not reasonably be interpreted to restrict an employee's Section 7 right to:
- engage in concerted attempts to change his employment at-will status; or
- select a collective bargaining representative and bargain collectively for a contract.
The associate general counsel read each of the policies in context and found that the at-will policy in:
- Mimi's Café highlights the employer's policy that company representative are not authorized to modify an employee's at-will status and reinforces that nothing in the handbook creates an employment contract.
- Rocha Transportation prohibits the employer's representatives from entering into employment contracts with employees for something other than at-will employment, but explicitly permits the employer's president to enter into written employment agreements that modify the at-will relationship, including the possibility of a collective bargaining agreement.
The associate general counsel distinguished these at-will policies from the policy at issue in American Red Cross Arizona Blood Services Region, in which an NLRB administrative law judge (ALJ) found that the employer's at-will language violated Section 8(a)(1) of the NLRA. The language at issue in American Red Cross included an acknowledgment of at-will employment status signed by employees stating:
"I further agree that the at-will employment relationship cannot be amended, modified or altered in any way."
The associate general counsel distinguished this language because it used the personal pronoun "I" and involved a waiver of the employee's Section 7 rights that was clearer than the at-will employment language in Mimi's Café and Rocha Transportation.
Based on this analysis, the associate general counsel recommended that the charging parties' allegations be dismissed. Explicitly recognizing that this is an unsettled area, he also recommended that all cases involving employer handbook provisions restricting modification of an employee's at-will status be submitted to the Division of Advice.
Practical Implications
The NLRB General Counsel's office provided these advice memoranda as guidance for employers in a developing area of law that has drawn considerable attention recently. The memoranda distinguish the at-will employment language in the Mimi's Café and Rocha Transportation handbooks from the at-will clause at issue in American Red Cross, which an ALJ found unlawfully broad. The memoranda also provide some guidance to employers on what at-will employment policy language may withstand NLRB review. In addition, these memoranda clarify that the Office of General Counsel will read at-will employment policies in an employee handbook in context and apply the analysis set out in Lutheran Heritage.