Legal View: NLRB rules that handbook language is enough to overturn election

By Howard Rubin and Don Stait

The Daily Record Newswire

Jurys Boston Hotel, as an employer, likely thought it did everything right. Its employee handbook contained a disclaimer that advised employees that they have rights that supersede any contrary rule in the handbook.

When its employees sought to decertify the union, and the union challenged three of the handbook policies (solicitation, loitering and dress code), Jurys responded by amending two of the policies and eliminating a third. In addition, Jurys sent a memo to all employees stating that the rules were not intended to infringe on employees' rights under the National Labor Relations Act.

But that still wasn't enough to satisfy the National Labor Relations Board, which ruled that the employer's handbook was sufficient, on its own, to overturn the election results.

Prior to opening for business in 2004, Jurys agreed to accept the union as the employees' bargaining representative on the basis of authorization cards, and without an election. The handbook, which had been in place since the hotel opened, not only had the general disclaimer that the employees had rights that superseded any contrary rule, but also contained a "no solicitation or distribution policy," a "loitering" prohibition, and a dress code policy banning the wearing of buttons.

At the time of the NLRB election, these policies had been in effect for several years without union objection, and there was no evidence that Jurys had ever enforced the policies. No evidence was presented that the rules were important or influential to the employees, or even that the employees knew of the rules' existence; employees were not even required to sign an acknowledgment that they had received the handbook.

But the NLRB ruled that the hotel's solicitation, loitering and dress code policies were overbroad and could have influenced the results of the election. In part, this was because the election was decided in favor of decertification by only one vote. The NLRB reasoned that despite seeing "no evidence that any employees were actually deterred from engaging in campaign activity," the election results "might have been affected" and "the election must be set aside (where) the maintenance of these rules 'could . . . reasonably have affected the results.' "

The NRLB also ruled that the hotel's general disclaimer was insufficient to overcome the handbook provisions, after the hearings officer concluded that employees could not be called upon to know which particular rules were overbroad and which did not need to be followed.

Interestingly, the union could have blocked the election until the policy issues were sorted out. Instead, it opted to wait for the election's outcome, and complained only when it was not in its favor.

The NRLB's decision in this case underscores the need to review policies before issues come up. Even though this decision was handed down in a decertification context, the NRLB made it clear that its decision would apply equally in a representation election. A handbook containing narrowly crafted policies in addition to disclaimer language can help avoid NLRA violations.

Internal oral complaints can trigger anti-retaliation protection under the FLSA.

The U.S. Supreme Court last month ruled that the Fair Labor Standards Act's anti-retaliation protections are triggered whether the complaint is oral or written. The court's decision in Kasten v. Saint-Gobain Performance Plastics Corp. put an end to a split between the federal appellate courts by interpreting the FLSA phrase "filed any complaint" to include oral complaints.

In Kasten, an employee complained to his employer that the location of the time clock was illegal because it prevented employees from being paid for time spent donning and doffing their work gear. The employee indicated that he might file a lawsuit and was fired. A federal court in Wisconsin dismissed the suit, holding that oral complaints were not protected under the FLSA. The Seventh Circuit Court of Appeals agreed.

On review, the U.S. Supreme Court vacated the judgment, and held that oral complaints are protected. In looking to the purpose and context of the statute, the court reasoned that to deny protection for oral complaints would undermine the purpose of the anti-retaliation provision; disadvantage illiterate, less educated and overworked employees; prevent the use of hotlines for reporting retaliation; and discourage employers from using informal internal complaint procedures to assure compliance.

The court made it clear that the oral complaint put the company on fair notice that a grievance had been lodged. The court held that a complaint is "filed" when "a reasonable, objective person would have understood the employee to have put the employer on notice that the employee is asserting statutory rights under the (FLSA)." The court declined to resolve the issue of whether a complaint must be made to a government entity to be protected under the FLSA.

It is likely that there will be an increase in the number of retaliation claims filed following the Kasten decision. Prudent employers should assume that oral internal complaints regarding possible violations of the FLSA will be protected. Employers should:

-- review retaliation policies and update them if necessary;

-- train supervisors on how to spot complaints; and

-- investigate oral and written complaints and take any necessary actions while protecting the complaining party from retaliation.


Howard Rubin is a shareholder in Littler Mendelson's Portland office. Contact him at 503-221-0309 or Don Stait is Special Counsel in Littler Mendelson's Portland office. Contact him at 503-221-0309 or

Published: Wed, May 11, 2011


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