New Year, New Board: Significant Changes at the NLRB

If you feel overwhelmed by a seemingly never-ending stream of news about what the National Labor Relations Board is doing, you are not alone. It’s tough to keep up. The issue is this: Though the NLRB in many ways looks and acts like a court, it is a federal agency (i.e., part of the executive branch). Its leadership is appointed by the president, and changes in presidential administrations often usher in changes, sometimes confusing changes, in Board precedent.

Under President Obama, the NLRB was harshly criticized by Republicans and employers as acting radically to stretch labor protections beyond the bounds of the National Labor Relations Act, particularly with respect to decisions impacting terms and conditions of employment in non-union workplaces.

But now, change is (once again) afoot at the NLRB.

In Fall 2017, the Senate confirmed two Republicans to the Board, giving the GOP control of the body for the first time in nearly a decade. Then, in November, the Senate confirmed management-side lawyer Peter Robb as the NLRB’s General Counsel, a position that comes with broad policy- and agenda-setting control and day-to-day administrative authority for the agency.

Within days of his confirmation, Robb issued a General Counsel memo, GC Memo 18-02, giving employers reason to hope that many Obama-era Board decisions will be undone:

  • GC Memo 18-02 rescinds seven advice memos issued by Robb’s predecessor, including a controversial memo advising that many employer handbook policies on dignity and respect violate the NLRA.
  • GC Memo 18-02 directs that all cases involving “significant legal issues” should be submitted to the GC’s office and defines “significant legal issues” to include cases “over the last eight years that overruled precedent and involved one or more dissents” (i.e., most of the Obama-era Board’s controversial, pro-employee decisions).

It is no stretch to read the new GC Memo as an unequivocal indication that Robb intends to upend Obama-era Board law, and all signs are that he will face little resistance from the newly GOP-controlled Board. Just days after Robb issued his Memo, the Board dismantled several key Obama-era rulings, including:

  • In The Boeing Company, the NLRB overturned precedent and created a new test for evaluating the lawfulness of employer policies. Under the new test, employers should expect significantly more deference to legitimate justifications for workplace rules and policies. (In this case, the Board found that Boeing established a legitimate business interest in maintaining a “no camera rule.”)
  • In Hy-Brand Industrial Contractors, the Board jettisoned the controversial, Obama-era Browning-Ferris joint-employer test and reinstated the more rigorous direct-control standard for determining joint-employer status.

The developments of late last year foreshadow what 2018 almost certainly holds in store. Other Obama-era Board decisions on Robb’s chopping block likely include those making it more difficult for employers to keep internal investigations confidential and finding that employees may use work e-mail accounts for NLRA-protected purposes. And it is possible that the Board will revisit (and reverse) its decision on the unlawfulness of class-action waivers in arbitration agreements before the U.S. Supreme Court decides the issue.

The bottom line for employers is this: President Trump’s appointees are shaking up the NLRB, and it may be possible for both union and non-union employers to roll back changes implemented over the past eight years to comply with Obama-era Board decisions. Employers interested in such roll-backs—such as reversing changes that were made to handbook policies, to procedures for conducting internal investigations, and to employee confidentiality and arbitration agreements—should closely monitor new developments from the Trump NLRB.