NLRB Acting General Counsel Provides Guidance on At-Will Employment Disclaimers
On October 31, 2012, the Acting General Counsel of the National Labor Relations Board issued two advice memos recommending the dismissal of unfair labor practice charges alleging the employers’ at-will disclaimers in their employee handbooks violated the National Labor Relations Act. In the first advice memo issued yesterday, (Rocha Transportation, NLRB Case No. 32-CA-086799 (G.C. Div. of Advice Memo., October 31, 2012)), the employer maintained an at-will policy in its Driver Handbook stating that:
Employment with Rocha Transportation is employment at-will. Employment at-will may be terminated with or without cause and with or without notice at any time by the employee or the Company. Nothing in this Handbook or in any document or statement shall limit the right to terminate employment at-will. No manager, supervisor, or employee of Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will. Only the president of the Company has the authority to make any such agreement and then only in writing.
Similarly, the employer in the second advice memo (SWH Corporation, NLRB Case No. 28-CA-084365 (G.C. Div. of Advice Memo., October 31, 2012)), maintained the following at-will policy statement in its employee handbook:
The relationship between you and Mimi’s Café is referred to as “employment at will.” This means that your employment can be terminated at any time for any reason, with our without cause, with or without notice, by you or the Company. No representative of the Company has authority to enter into any agreement contrary to the foregoing “employment at will” relationship. Nothing contained in this handbook creates an express or implied contract of employment.
In both cases it was alleged that the at-will policies were overbroad and would reasonably chill employees in the exercise of their rights under the Act.
The acting general counsel concluded in both cases that the employers' employment at-will provisions "would not reasonably be interpreted to restrict an employee's Section 7 right to engage in concerted attempts to change his or her employment at-will status" since:
[t]he provision does not require employees to refrain from seeking to change their at-will status or to agree that their at-will status cannot be changed in any way. Instead, the provision simply prohibits the [Employers’] own representatives from entering into employment agreements that provide for other than at-will employment.
In finding both provisions lawful, the Acting General Counsel distinguished American Red Cross Arizona Blood Services Region, NLRB Case No. 28-CA-23443 (Feb. 1, 2012), in which an administrative law judge found an employer’s at-will policy unlawful. In that case, employees were required to sign a form acknowledging their at-will employment status:
I further agree that the at-will employment relationship cannot be amended, modified or altered in any way.
According to the Division of Advice, American Red Cross “more clearly involved an employee’s waiver of his Section 7 rights than the handbook provisions here” because the employees, by signing the acknowledgement, had to agree that their at-will employment could not be changed in any way, and was thus a waiver of the employee’s right “to advocate concertedly…to change his/her at-will status.”
Given that employers have long utilized employment at-will provisions in employee handbooks as a defense to potential claims by employees that the provisions in the handbook create an employment contract, these advice memorandum provide much-needed guidance for employers regarding at-will disclaimers given the NLRB’s ruling in American Red Cross earlier this year. However, the Acting General Counsel noted that the law in this area remains unsettled, and has thus requested that the Regions submit all cases involving employee handbook provisions restricting modification of an employee’s at-will status to the Division of Advice.
