New York City Restricts Use Of Criminal Records In Hiring Giving Job Applicants a “Fair Chance” at Employment

As expected, on June 29, 2015, New York City Mayor Bill de Blasio signed into law the Fair Chance Act (Intro. No. 318-A), making New York City the latest jurisdiction to prohibit employers from conducting pre-offer criminal background checks when hiring. The new law prohibits private employers who operate in New York City with four or more employees, from inquiring about applicants’ past criminal convictions until a conditional job offer has been made. After a conditional offer, an employer can commence a criminal background check and make inquiries related to criminal history. If a company decides to withdraw the offer after learning of the applicant’s criminal history, it needs to give the applicant a written explanation of the decision. The employer must conduct an individualized evaluation of any criminal conviction it discovers pursuant to the factors under existing New York State law. Further, the employer needs to hold the position open for three days to allow the applicant an opportunity to respond and provide any proof of rehabilitation. The Act also includes individual independent contractors performing work for the employer, if those individuals do not themselves have employees. Moreover, employers must not specify in job advertisements or other written statements that any position entails restrictions based on criminal records, unless expressly allowed by law (e.g., for law enforcement agencies).

Under the new law, the NYC Human Rights Commission is charged with enforcing its key protections. The Fair Chance Act does not affect federal and state laws that allow employers in certain industries to consider applicants’ criminal histories, including law enforcement, positions of public trust, and jobs that entail working with children.

The new law takes effect on October 27, 2015. Employers in New York City should begin consulting with legal counsel to ensure that their hiring process forms, job applications and hiring policies are in compliance with the new law. Legal compliance should also include educating managers, supervisors and recruiting personnel regarding these new standards to ensure they are communicated throughout the organization.

For more information regarding the Fair Chance Act and to learn how your business can implement best practices when hiring and conducting background checks, please contact John C. Petrella, Director of the firm’s Employment Litigation Practice Group at jpetrella@genovaburns.com or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@genovaburns.com or 973-533-0777.

N.J. Supreme Court Finds Chapter 78 Did Not Create an Enforceable Contract Right

In Burgos v. State of New Jersey, the New Jersey Supreme Court held that the 2011 pension and health benefit reform statute, known as Chapter 78, did not create an enforceable contract that was binding on the State to make the pension payments required by that legislation.

The decision is the result of multiple actions filed by individuals and unions, on behalf of New Jersey State employees, after the fiscal year 2015 budget included contributions that were less than 1.57 billion dollars that Chapter 78 required.  The Law Division accepted the Unions’ argument that Chapter 78 created a contractual right to the payment and failure to do so was an impairment of that contract.  The Supreme Court reversed.

The plain language of Chapter 78 set forth a clear statement that the failure to make the required pension contributions results in a contractual impairment.  Although the Supreme Court recognized the good intentions of the legislature in passing Chapter 78, the Court simultaneously rejected the legislature’s authority to do so.  The Court’s rationale was largely based upon two clauses within the New Jersey Constitution.

First, the Debt Limitation Clause of the New Jersey Constitution prohibited such action.  The intention of Chapter 78 could not set aside the broad, clear language contained in the Debt Limitation Clause.  In sum, this provision limits the amount of debt or liability the Legislature may incur on a year to year basis without a vote of public.  The Court found that the contributions required by Chapter 78 surpassed the permissible boundaries of the Debt Limitation Clause and therefore would require a vote of the public in order to pass constitutional muster.

Second, the Court reasoned that the mandates of Chapter 78 failed to meet the requirements of the Appropriations Clause of the New Jersey Constitution.  The Court reasoned that the legislature retains the power to annually appropriate funds as necessary.  The required contribution in Chapter 78 did not retain the legislature’s authority to annually appropriate such funds.

These two constitutional clauses were the linchpin in the Court’s decision to uphold the State’s failure to make the required Chapter 78 contributions.  While the Court explained the legal rationale for its decision, it also highlighted the practical imports of its decision as well, among which was the damage to the public trust.  In addition, the Court recognized the significant difficulties facing the pension system.  However, rather than fashion a judicial remedy, the Court called upon the public noting “it is the people’s responsibility to hold the elective branches of government responsible for their judgment and for their exercise of constitutional powers.”

The Court’s decision in Burgos negated the required State contributions of Chapter 78 to the pension system.  The issue of how to fund the depleted public employee pension system will continue to be at the forefront of future public debate.

For more information, or if you have any questions, please contact Joseph M. Hannon, Esq., at 973.535.7105, jhannon@genovaburns.com, or Jennifer Roselle Esq., at 973.646-3324, jroselle@genovaburns.com.

Third Circuit Offers Key Guidance on FMLA Regulations for Employers

Recently, the Third Circuit has issued two opinions that clarify the Family and Medical Leave Act (“FMLA”) regulations, giving crucial guidance to employers in navigating how to handle employees’ leave requests.

Sunset to Sunrise is Required to be an FMLA “Overnight” Success

First, late last month, the Third Circuit ruled that an employee’s hospital stay did not constitute an “overnight stay”, and therefore did not merit protection under the FMLA.  Under the FMLA, a “serious health condition” is defined as “an illness, injury, impairment, or physical condition,” that involves either inpatient care or continuing treatment by a care provider.  The regulations further define “inpatient care,” in part, as “an overnight stay in the hospital.”

In Bonkowski v. Oberg Industries, Inc., Case No. 14-1239 (3rd Cir. May 22, 2015), the plaintiff employee had a history of medical issues.  On November 14, 2011, he was given permission to leave work early after complaining of shortness of breath, chest pains, and dizziness.  The plaintiff went to the hospital later that night for his symptoms, and was admitted shortly after midnight and was discharged later the same day. Plaintiff was terminated the next day and brought suit alleging retaliation and interference with his rights under the FMLA.  The Court held that the plaintiff did not have a serious health condition because his trip to the hospital did not constitute an “overnight stay” within the meaning of the FMLA. The Third Circuit adopted a clear “bright-line” calendar test and ruled that for purposes of the FMLA, an overnight stay is “for a substantial period of time from one calendar day to another calendar day as measured by the individual’s time of admission and time of discharge.” The Third Circuit also suggested that “a minimum of eight hours would seem to be an appropriate period of time.”  Thus, an individual who is admitted to a hospital and discharged on the same calendar day appears to have a short-term condition, for which treatment and recovery are brief. Thus, the employee’s visit to the hospital would not be protected by the FMLA.

Employees Must Be Given Time to Clarify Medical Leave Requests

On June 22, 2015, on a matter of first impression, the Third Circuit in Hansler v. Lehigh Valley Hospital Network, Case No. 14-1771 (3rd Cir. June 22, 2015), held that an employer must give an employee the opportunity to cure any deficiencies in a medical certification submitted in support of FMLA leave. In Hansler, the plaintiff submitted a request for intermittent FMLA leave, along with a medical certification that stated that she would need about two days off per week for one month, but did not specify the nature of her medical condition. The defendant employer terminated Hansler for absenteeism without seeking further information from either her or her physician.  Hansler then sued her employer alleging interference and retaliation under the FMLA.

The employer argued that the request for leave was defective, because the FMLA requires that a chronic serious health condition persist for “an extended period of time,” but the employee’s certification indicated that her condition would only last for one month.  The Eastern District of Pennsylvania agreed; however, on appeal, the Third Circuit reversed.  The Third Circuit held that FMLA regulations require that if an employer determines that a medical certification is either incomplete or insufficient, it may deny the requested leave, but only after the employee has been given seven days to fix any deficiencies. The Third Circuit found Hansler’s certification wasn’t “negative,” meaning that on its face, it indicated Hansler did not have a “serious medical condition” because one month is not an “extended period” of time, but rather the certification was insufficient or incomplete because relevant information about her condition, including the diagnosis, was not yet available when she requested leave.  The Third Circuit found that this can be the case even if the employee’s original medical certification does not describe a condition that is covered under the FMLA. Thus, Hansler’s employer should have provided her with her seven days to cure the deficiencies in her medical certification.

Employers’ Takeaways 

  • In order to determine whether the employee’s hospital stay qualifies as an overnight stay under the FMLA, it must constitute a “substantial period of time” from one calendar day to the next as measured by the individual’s time of admission and time of discharge.
  • Employers must also review medical certifications submitted in support of FMLA leave extremely carefully in order to determine whether or not the information provided is negative or is simply incomplete or insufficient.
  • In cases where the medical certification is incomplete or insufficient, employers must notify an employee and allow him or her seven days to cure the deficiencies prior to acting on the request for FMLA leave.

For more information regarding these rulings and to learn how your business should be evaluating FMLA requests, please contact John C. Petrella, Director of the firm’s Employment Litigation Practice Group at jpeteralla@genovaburns.com or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@genovaburns.com or 973-533-0777.

Supreme Court Rejects Challenge to Affordable Care Act’s Tax Credit Provisions

On June 25, the U.S. Supreme Court, in a 6-3 decision, finally resolved a central issue under the Affordable Care Act (“ACA”) as to whether Congress’ failure to provide expressly for Federal subsidies to States that did not create their own health care Exchanges but opted for the Federal tax credits should prohibit payments of Federal tax credits to individuals who purchase their coverage from the Federal Healthcare Exchange.

The Court held that despite the inartful drafting and ambiguities in the legislation, the Court would enforce what it viewed to be Congress’ intent in the legislation to have State and Federal Healthcare Exchanges work the same in every State, regardless of whether the State has its own Exchange or depends on the Federal Exchange. The Court reasoned that its job was to read the words of the statute “in their context and with a view to their place in the overall statutory scheme” and concluded that the ACA “indicates that State and Federal exchanges should be the same,” and therefore, tax credits must be available on both State and Federal Exchanges.

In sum, the Court ruled that ACA tax credits are available under the State and the Federal Exchanges “to avoid the type of calamitous result that Congress plainly meant to avoid.”

For questions related to this development or ACA generally, please contact Patrick W. McGovern, Esq., Director of the Employee Benefits Practice Group and Partner in the Labor Law Group, at pmcgovern@genovaburns.com, or Gina M. Schneider, Esq., a member of the Employee Benefits Practice Group and Counsel in the Labor Law Group, at gmschneider@genovaburns.com.

New York City Is One Step Closer To Banning The Box Giving Job Applicants a “Fair Chance” at Employment

On June 10, 2015, the New York City Council approved a “Ban the Box” law that prohibits private employers from inquiring about applicants’ past criminal convictions until the point of a job offer. Although New York State already has a similar law which applies to city contractors and agencies, the new legislation, called The Fair Chance Act, extends these regulations to private employers. The policy applies to any employer with four or more employees that conducts business in New York City. Under the new law, an employer is not permitted to ask about criminal history and/or conduct a background check until a conditional job offer has been extended. If a company decides to withdraw the offer after learning of the applicant’s criminal history, it needs to give the applicant a written explanation of the decision. Further, the employer needs to hold the position open for three days to allow the applicant an opportunity to respond and provide any proof of rehabilitation.

The Fair Chance Act would not affect federal and state laws that allow employers in certain industries to consider applicants’ criminal histories, including law enforcement, positions of public trust, and jobs that entail working with children. Mayor De Blasio is expected to sign the bill in the coming weeks, and stated that “[t]his legislation seeks to actually open the door to jobs for people rather than damning them to no economic future.”

These new requirements take effect in 120 days following the law’s enactment. Employers in New York City should begin consulting with legal counsel to ensure that their hiring process forms, job applications and hiring policies are in compliance with the new legislation. Legal compliance should also include educating managers, supervisors and recruiting personnel regarding these new standards to ensure they are communicated throughout the organization.

For more information regarding this legislation and to learn how your business can implement best practices when hiring, please contact John C. Petrella, Director of the firm’s Employment Litigation Practice Group at jpetrella@genovaburns.com or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@genovaburns.com or 973-533-0777.

Potential Relief on the Horizon for Business Owners as New Jersey Legislature Considers Controversial Revision To Proposed Statewide Sick Leave Law

A new version of the proposed statewide New Jersey sick leave law, sponsored by Assemblywoman Pamela Lampitt (D-Voorhees) as well as other Democrats in the Assembly may potentially include a controversial amendment that would make the bill more palatable to businesses. The revised bill could come with an amendment that would pre-empt local governments from adding to any statewide sick leave requirements that would be enacted. NJBIZ is reporting that the revised bill – with such a pre-emption — could resurface by the end of this month.

As it currently stands, the proposed statewide bill allows full-time and part-time employees to earn one hour of paid sick time for every 30 hours worked. Employees at businesses with ten or more employees would have a 72-hour-per-year cap, while employees at businesses with nine or fewer employees would have their paid sick hours per year capped at 40. In its current form, the bill allows New Jersey municipalities to adopt their own local paid sick leave ordinances, as long as those ordinances were in compliance with the statewide law. Nine municipalities have already passed their own paid sick leave ordinances: Jersey City, Newark, Passaic, East Orange, Paterson, Irvington, Montclair, Trenton and Bloomfield.

Business groups widely support an amendment to the state bill that would pre-empt all local ordinances. The amendment would allow businesses to create a uniform plan for compliance with the state law, rather than adjusting paid sick leave policies in municipalities that have their own, more expansive paid sick leave laws. In interviews with NJBIZ, leaders from the New Jersey Chamber of Commerce and the New Jersey Business & Industry Association expressed disapproval of the idea of a statewide paid sick leave law, but acknowledged that amendments to the bill that would ease the burden on businesses would be welcome. Conversely, representatives from employee advocacy groups New Jersey Citizen Action and New Jersey Working Families informed NJBIZ that an amendment with local pre-emption would be an unwelcome addition to the statewide bill.

The Statewide bill’s sponsor in the Senate, Sen. Loretta Weinberg (D-Teaneck), seemed open to discussion, stating, “I am working with the Assembly sponsors to advance this measure and discussing the potential for amendments to the legislation.”

For more information regarding this proposed bill and to learn how your business can implement best practices when dealing with paid sick leave laws, please contact John C. Petrella, Director of the firm’s Employment Litigation Practice Group at jpetrella@genovaburns.com or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@genovaburns.com or 973-533-0777.

New York City Bans Employers From Using Credit Checks To Screen Job Applicants

Under a bill signed into law by Mayor Bill de Blasio on Wednesday, May 6, 2015, New York City businesses will be banned from using credit reports, bankruptcies and liens to disqualify applicants from employment. The Stop Credit Discrimination in Employment Act, which was sponsored by Councilman Brad Lander (D-Brooklyn), takes effect in 120 days and will amend the New York City Human Rights Law (NYCHRL).  Only three New York City Council members voted against the measure.  Advocates of the law pressed politicians for the prohibition arguing that law-abiding applicants cannot get jobs after being saddled with student loans or medical bills that have ruined their credit.  New York City will now join California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont, and Washington, as well as the city of Chicago in limiting the use of credit checks for employment purposes.

Under the new law, it will be an unlawful discriminatory practice for a New York City employer, labor organization, or employment agency to request or use for hiring or other employment purposes the consumer credit history of an employee or applicant. “Consumer credit history” includes an individual’s credit worthiness, credit standing, credit capacity, or payment history as indicated by a consumer credit report, credit score, or information an employer obtains directly from the individual.

The new law, however, provides for several exemptions: law enforcement and other professions involving a high level of public trust or access to sensitive information, and for employers who conduct credit history checks pursuant to state and federal laws or regulations. For these positions, employers must still comply with the notice and consent requirements of the federal Fair Credit Reporting Act (FCRA) as well as any equivalent state or local laws.  FCRA requires notice to the applicant, providing a copy of “A Summary of Your Rights Under the Fair Credit Reporting Act,” and obtaining written authorization/consent from the applicant or employee.

Given the amendment to the NYCHRL, the New York City Commission on Human Rights (“NYCCHR”) will be the law’s enforcement authority.  Individuals will be able to file a complaint with the NYCCHR or file an action directly in state court. Successful plaintiffs will be able to recover back pay, compensatory and punitive damages, attorneys’ fees and costs, reinstatement and/or other equitable relief.

Employers’ Takeaway

  • As of September 3, 2015, subject to limited exceptions, New York City employers may not utilize credit reports, bankruptcies and liens to disqualify applicants from employment.
  • Employers who use credit checks should carefully review the limited exceptions in the law to determine which positions, if any, can still be subject to credit checks.
  • Employers must review their application forms, offer letters, and handbooks with counsel to ensure the removal of any reference to credit checks for positions that do not meet one of the law’s limited exceptions.

For more information regarding the new law and to learn how Genova Burns can assist your company to comply with the new law by September 3, 2015, please contact John C. Petrella, Director of the firm’s Employment Litigation Practice Group at jpetrella@genovaburns.com or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@genovaburns.com or 973-533-0777.

Supreme Court: The EEOC Must Answer For Its Efforts To Conciliate

On Wednesday, April 29, 2015, the United States Supreme Court unanimously held that courts may review whether the United States Equal Employment Opportunity Commission (“EEOC”) fulfilled its obligations to engage in conciliation efforts with employers before filing lawsuits against them under Title VII. Writing for the unanimous Court in Mach Mining, LLP v. Equal Employment Opportunity Commission, 575 U.S. ___ (2015), Justice Elena Kagan rejected the EEOC’s argument that Title VII provided no standards by which a court might evaluate the sufficiency of the EEOC’s conciliation efforts. Justice Kagan emphasized the importance of conciliation within the scheme of Title VII and wrote that absent judicial review, “[t]he Commission’s compliance with the law would rest in the Commission’s hands alone.”

The case in Mach Mining was brought after a woman filed a Charge of Discrimination with the EEOC claiming that the company refused to hire her as a coal miner because of her sex. The EEOC thereafter found reason to believe that Mach Mining had also discriminated against a class of women who unsuccessfully applied for mining-related jobs. The EEOC notified Mach Mining that it intended to begin informal conciliation. After a year of discussions, the EEOC advised Mach Mining in 2011 that the conciliation process had failed, and filed a complaint in the district court. In its answer to the Complaint, Mach Mining argued that the EEOC had failed to conciliate in good faith. In response, the EEOC argued that its conciliation efforts were not reviewable by the court. The district court certified that issue for appeal to the Seventh Circuit. On appeal, the Seventh Circuit held that the EEOC’s conciliation efforts were not reviewable by the court. The Seventh Circuit found that allowing court review of the EEOC conciliation process would create an avenue for employers to bypass liability for discriminatory behavior. The Seventh Circuit’s decision created a circuit split, as the Second, Fourth, Fifth, Sixth, Eighth, and Ninth Circuits have all held that the EEOC’s duty to conciliate is reviewable to some extent.

The Supreme Court agreed to hear the case in June of 2014. The Court’s focus was whether Title VII’s broad grant of authority to the EEOC allowed room for judicial review of the conciliation process. The Justices sought to define a workable standard that would allow for limited review while still giving the EEOC wide discretion. In Wednesday’s opinion, the Court found that a court may review whether or not the EEOC “satisfied its statutory obligation to attempt conciliation before filing suit. But we find that the scope of that review is narrow,” and wrote further that the EEOC may still “determine the kind and amount of communication with an employer appropriate in any given case.” However, the Court determined that the EEOC’s “bookend” letters to Mach Mining were insufficient to prove that it had “actually, and not just purportedly, tried to conciliate a discrimination charge.”

To comply with Title VII, the Supreme Court held that “[a] sworn affidavit from the EEOC stating that it has performed [its conciliation obligations] but that its efforts have failed will usually suffice to show that it has met the conciliation requirement.” Judicial review is limited to ensuring that the EEOC has sworn that it has performed the conciliation process, and weighing any evidence provided by the employer that the EEOC had not actually participated in the conciliation process as sworn.

Employers’ Takeaway: The decision by the Supreme Court in Mach Mining ensures that the EEOC must afford employers with an adequate opportunity to discuss and address any perceived Title VII violation through its conciliation process. The decision makes clear that it is not sufficient for the EEOC to merely notify employers of the alleged violation and then inform the employer that the conciliation process has ended. If your organization receives a “reasonable cause” finding, monitor what efforts the EEOC makes to conciliate and pursue voluntary compliance. If the EEOC fails to do so, employers may seek to compel the EEOC to make an effort compliant with its statutory obligations before the EEOC files suit. Employers, however, should note that the decision in Mach Mining explicitly gives the EEOC broad discretion in the conciliation process and the decision cannot be relied upon as an opportunity to challenge all EEOC conciliation efforts.

For more information regarding this case and to learn how your business can implement best practices when dealing with the EEOC, please contact John C. Petrella, Director of the firm’s Employment Litigation Practice Group at jpeteralla@genovaburns.com or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@genovaburns.com or 973-533-0777.

SEC Targets Confidentiality Agreements That Stifle Whistle-Blowing

On April 1, 2015, the Securities and Exchange Commission (“SEC”) announced its first enforcement action and settlement against a company for violations of the whistleblower protection provisions of the Dodd-Frank Act regulations.  KBR, Inc. required some of its employees to sign a Confidentiality Statement which warned that an employee could be subject to discipline, up to and including termination, if the employee discussed an internal investigation with outside parties without receiving prior authorization from KBR’s legal department.  The SEC found that the Confidentiality Statement violated SEC Rule 21F-17, which forbids companies from “tak[ing] any action to impede an individual from communicating directly” with the SEC regarding possible securities violations. Although the SEC did not find that KBR had tried to enforce the provision or prevent anyone from speaking with the SEC, the SEC found that the language within the confidentiality agreement alone was sufficient to violate Rule 21F-17(a).

The SEC’s announcement is being hailed as a major victory for whistleblowers, protecting them from signing excessively restrictive confidentiality agreements that threaten lawsuits and termination for reporting allegations of fraud. The SEC’s Cease-and-Desist Order found that this Confidentiality Statement had a sufficient potential to intimidate whistleblowing activity, and was contrary to SEC Rule 21F-17’s purpose of encouraging individuals to report potential violations to the SEC.

In addition to a $130,000 fine, KBR voluntarily amended its Confidentiality Statement to inform employees that the Statement does not prohibit employees from reporting possible violations of federal law or regulation to any government agency or entity.  Additionally, KBR agreed to notify KBR employees that signed the Confidentiality Statement about the SEC Order.  Given the SEC’s renewed focus on confidentiality agreements, companies that utilize these agreements (whether contained in company policies, codes of conduct, severance agreements, employment agreements, or otherwise) should consider how these provisions might be viewed by the SEC.

Employer Takeaways

  • The SEC’s enforcement action against KBR demonstrates that all employee agreements must be drafted to ensure that they do not suggest that the reporting of a potential violation to government agencies will subject the employee to an adverse employment action.
  • Employers and in-house counsel should review their confidentiality, settlement and severance agreements to ensure that customary confidentiality provisions do not prevent an individual from communicating with the SEC about a potential securities law violation.
  • Internal policies, confidentiality statements, codes of conduct, and certification procedures should remind employees that they have the right to file claims and disclose information regarding the employer’s business practices, not only with the SEC but with the EEOC, the Department of Labor, or any other applicable enforcement entity.

For more information about how your organization should comply with the SEC’s regulations, please contact Dina M. Mastellone, Esq., Director of the Human Resources Practice Group at 732-842-2732, DMastellone@genovaburns.com, or Julia A. O’Halloran, Esq. at 973-646-3296, JOHalloran@genovaburns.com.

 

NLRB Guidance Further Defines Permissive Employer Handbook Rules

The NLRB’s General Counsel recently issued a report further defining the limitations on an employer’s ability to enact workplace rules which tend to interfere with an employee’s Section 7 rights under the National Labor Relations Act. Section 7 rights generally entitle employees to self-organize, form or join a labor organization, bargain collectively, and engage in other concerted activities for the purpose of collective bargaining, as well as the right to refrain from such activities.

The report analyzes real life examples of employer rules the NLRB has assessed to determine whether the rules interfere with the employees’ rights and provides insight into the types of policies that the NLRB is likely to uphold.

Analyses of challenged work place rules are reviewed in the full context in which the issue surrounding the rule arose; the NLRB guidance states that it will not read employer rules in isolation to determine their legality. Relying on previously litigated handbook provisions for guidance, the NLRB nonetheless identifies a number of handbook rules typically deemed unlawful. Common characteristics among unlawful employer rules include use of overbroad phrases such as “inappropriate” or “negative”; blanket restrictions on certain types of conduct; and failure to provide any definition or examples of the conduct the employer seeks to prohibit.

By contrast, lawful employer rules tend to clarify broad statements, define vague terms, provide specific examples and use careful language that would not cause an employee to reasonably interpret the rule to prohibit Section 7 activity. For example, while a work rule that requires the employee to “be polite” may be overbroad, a rule prohibiting unprofessional behavior while performing company business with company clients may be more likely to be upheld.

The General Counsel’s report also focuses on areas such as confidentiality of information, professionalism, anti-harassment, trademark, photography and recording, leaving work and conflict of interest for illustrative purposes. Of particular note is the attention given to the recent Wendy’s International LLC settlement, wherein a significant number of Employer policies were set aside as unlawful based on the failure to narrowly tailor prohibited conduct. The settlement in this case clarified these employer rules by providing express examples such as limiting the use of company logos for non-commercial purposes and expressly excepting behaviors which involve Section 7 activities.

The NLRB’s report demonstrates the care with which an employer’s handbook must be crafted to avoid Section 7 challenges. Employers should reevaluate their current handbook rules in light of guidance contained in this report. For more information about crafting lawful employer rules, or if you have any questions about the NLRB’s recent guidance, please contact James J. McGovern III, Esq. Director of the Labor Law Practice Group, at 973.535.7122, jmcgovern@genovaburns.com, or Nicole Leitner, Esq., at 973.387.7897, nleitner@genovaburns.com.