National Labor Relations Board Attacks Employment At-Will Doctrine

Contributed by Terry Fox

In remarks to the Connecticut State Bar Association’s annual meeting on June 11th, the NLRB identified that the next big enforcement focus will be on employers’ “at-will” statements within employee handbooks. Lafe Solomon, acting NLRB General Counsel, stated at the meeting that provisions asserting that employment is “at-will” and can be changed only in writing by a senior company official, violate the NLRA because an employee could reasonably believe that type of clause means even union representation and collective bargaining will not alter his or her at-will status, therefore attempts to organize would be futile. That violates the collective action portion of Section 7 of the NLRA. 

At-will employment, a creature of state law, is the doctrine that provides that the duration of employment is for no particular term and either the employee or employer may end the relationship without notice.  The opposite of “at-will” is employment for a set period, normally requiring termination only “for cause.”

Hyatt Hotels was hit with an NLRB complaint filed February 29th of this year (Case Number 28-CA-061114 filed in Phoenix, Arizona). While it predominantly involved social media issues, the NLRB alleged that the following phrases were discriminatory:

  • 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 . . . Hyatt’s Executive Vice President . . .
  • The sole exception [to employer’s right to change handbook and other policies] to this is the at-will status of my employment, which can only be changed in a writing signed by me and [Hyatt Executive].

The NLRB alleged that this language constituted the employer interfering with, restraining, and coercing employees in the exercise of rights guaranteed by the NLRA.  It was recently announced that Hyatt agreed to change those polices, in response to the NLRB’s complaint, on a nationwide basis. (http://hr.cch.com/eld/Hyattsettlement.pdf)  The Hyatt action by the NLRB comes after the decision in American Red Cross Arizona Blood Services Region, Case No. 28-CA-23443, decided February 1, 2012. (http://hr.cch.com/eld/RedCrossALJ.pdf). 

In Red Cross, the administrative law judge held that similar language violated the NLRA’s Section 7 rights, although for tenuous reasoning.  The reasoning was based on the government’s argument that the acknowledgement in effect constituted a waiver by which the employee agrees his or her status cannot change, which thereby effects a relinquishment of rights to advocate concertedly, whether represented by a union or not, to change at-will employment status.  This is in light of undisputed testimony that the employee at issue did vehemently engage in concerted activities.

It appears that the NLRB’s focus on social media and altering the employment-at-will doctrine is interjecting federal standards into state contract relationships, with an end game of promoting employee leverage against employers policed by the NLRB.  Notions of “free speech” under Section 7 are being articulated by the NLRB, even in private segment workplaces.  Perhaps for those non-union employees, the NLRB seeks to fill the void created by the free marketplace rejection of union representation – by fiat.  Employers are encouraged to have their personnel policies reviewed by competent legal counsel, to reduce the risk that the NLRB can take issue with the receipt provided by their employees.