NLRB Targets Non-Union Employers and At-Will Agreements

It is Employment Law 101 – employment in the United States is generally at-will.  Equally elementary to HR professionals and employment counsel is the use of a good, strong at-will policy and/or agreement.  So common is the use of at-will policies and agreements that you would be hard pressed to find an employment handbook or an employer that does not make some use of them.

Notwithstanding this universal use, the National Labor Relations Board is poised to target non-union employers which maintain at-will policies or agreements.  Although the NLRB has taken several steps to ease the ability for unions to organize non-union employers and the Board itself has aggressively targeted the actions of non-union employers, the challenge to at-will policies could be the most dramatic and foundational yet; potentially impacting almost every employer. Though no binding NLRB decision has yet been issued, the Agency has already successfully prosecuted at least two employers with these very common policies.

In February, the NLRB General Counsel’s Office was successful in its prosecution of the for its employee handbook acknowledgment which provided "I further agree that the at-will employment relationship cannot be amended, modified or altered in any way."  The Administrative Law Judge accepted the General Counsel’s argument that "the signing of the acknowledgment form is essentially a waiver in which an employee agrees that his/her at-will status cannot change, thereby relinquishing his/her right to advocate concertedly, whether represented by a union or not, to change his/her at-will status."  In other words, asking employees to agree that their at-will status cannot change effectively violates their rights to try to change it through unionization.

While the language in the American Red Cross Arizona acknowledgment may arguably be a little more restrictive than others, the next prosecution contained language eerily similar and common to that of other employers.  In Hyatt Hotels Corporation the General Counsel’s Office issued an unfair labor practice complaint asserting that the following provisions of the employee handbook acknowledgment violated the Act:

• "I understand my employment is ‘at-will.’"
• "I acknowledge that no oral or written statements or 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."

Although the case recently settled, the issuance of the complaint and the very generic nature of the challenged language was strong evidence that the NLRB was in fact targeting non-union employers’ use of at-will provisions.

Earlier this summer NLRB Acting General Counsel Lafe Solomon further confirmed the NLRB’s apparent new found concern with the allegedly over-broad and unlawful nature of at-will provisions.  Speaking to the Connecticut Bar Association, Mr. Solomon reiterated the theory advanced in the two earlier cases and asserted that an at-will policy/agreement would violate the Act if an employee could reasonably believe that it could not be changed through union organizing or a collective bargaining agreement.

Management Missive

• Management should be on the lookout for a full decision from the Board providing further guidance on the extent to which at-will policies may be deemed unlawful and ways to save them.
• Management should recognize that their at-will policies (as well as many other policies) may be attacked by unions seeking to organize their employees.
• Management may want to consider revising policies to provide potentially saving caveats (i.e. replacing authorizing language limited to only one executive with language that says the policy may be amended only by a valid agreement signed by authorized representatives and a single executive).