The Ends Do Not Justify The Means – D.C. Circuit Court Orders NLRB to Explain Itself

Contributed by Beverly Alfon

Over the last several months, the National Labor Relations Board (NLRB) has continued to pick at common employment handbook provisions such as company investigation policies, policies prohibiting defamatory or disparaging comments, confidentiality policies, and social media policies.  Recent Board decisions and various memoranda from the NLRB’s General Counsel have bolstered the perception among employers that anything goes so long as the ends justifies the means. 

Last week, however, the U.S. Court of Appeals for the District of Columbia Circuit had the opportunity to review a Board decision related to an employer’s policy banning insulting, provocative, and confrontational messages on employee clothing and the enforcement of that policy with respect to an employee’s union-sanctioned t-shirt (Medco Health Solutions of Las Vegas Inc. v. NLRB, D.C. Cir., No. 11-1282, 12/14/12).  The Court remanded the case back to the Board, reasoning that the Board failed to explain how the employer violated the National Labor Relations Act.  Specifically, the Court emphasized the Board’s complete departure from the framework that it established in another case, Lutheran Heritage Village-Livonia. In Lutheran Village, the Board held that an employer’s rule that neither expressly nor inherently restricts protected activity violates the NLRA only if: (1) the rule was promulgated in response to union activity; and, (2) a reasonable employee would construe the rule to prohibit protected conduct.  According to the Court, neither factor from Lutheran Village was met here.

As a result, although the Court agreed that the employee was engaged in protected activity when he wore the t-shirt to work, it declined to approve the Board’s failure to respond to the Company’s “straightforward” argument that it prohibited the shirt because it was insulting to the company and harmful to the company’s effort to attract and retain customers and failure to identify what evidence it required from the company to support its position.

Bottom line:  The D.C. Circuit’s remand order in the Medco Health Solutions case sends a clear message to the Board that it must do a better job of explaining and supporting its rulings.  However, it will not curb the NLRB’s active scrutiny of common employment policies and handbook provisions.  Employers must remain alert regarding NLRB determinations in this area and consider the factors set forth in the Lutheran Heritage Village case before disciplining an employee for conduct that may be protected by the National Labor Relations Act.