Recent decisions from the National Labor Relations Board (NLRB) find the board overturning two of its previously established standards. The NLRB overturned its standard for assessing the legality of employee handbooks, as established in the 2004 Lutheran Heritage Village-Livonia decision, with a 3-2 majority. The Lutheran Heritage standard held that an employee handbook policy is illegal if employees can “reasonably construe” that the policy prohibits them from exercising their rights under the National Labor Relations Act. In overturning the Lutheran Heritage decision, the board lays out three categories into which it will classify challenged rules: rules that are legal in all cases because they cannot be reasonably interpreted to interfere with workers’ rights or because any interference is outweighed by business interests, rules that are legal in some cases depending on their application, and rules that are always illegal because they interfere with workers’ rights in a way not outweighed by business interests.
The NLRB also reversed the decision it reached in the 2015 Browning-Ferris Industries of California, Inc. (BFI) case, in which it had expanded the test for determining joint employment. The board voted 3-2 to overturn the standard set in BFI, which established that a company can be classed as a joint employer even if the employer exerts “indirect control” over employees. During the vote, the board reverted to its pre-BFI standard of “direct and immediate control,” stating that the BFI test jeopardized the stability of relationships between employers and employees. The board’s dissenters countered that the board majority failed to solicit the public’s perspective, and challenged the majority’s policy basis for reversing the BFI standard as “entirely speculative.”
Please stay tuned for more detailed analysis and further coverage in our upcoming newsletters.