Overly Broad At-Will Disclaimer May Violate NLRA in Both Union and Non-Union Workplaces

Authors: Melissa A. Silver, XpertHR Legal Editor and Beth P. Zoller, XpertHR Legal Editor

Following up on the National Labor Relations Board's (NLRB) critical look at employer's social media policies, some recent cases out of the NLRB regional office in Phoenix, Arizona suggest that an overly broad at-will disclaimer in an employee handbook, personnel manual or an employee offer letter may violate the National Labor Relations Act (NLRA) by infringing upon the rights of both union and non-union employees to engage in a protected concerted activity, i.e., working collectively to improve working conditions. These provisions are common in employee handbooks and policies and as such, employers should be aware of these developments.

In one case, NLRB v. Hyatt Hotel Corp., 28 CA-061114 (February 29, 2012), the Phoenix, Arizona office of the NLRB filed an unfair labor practice complaint against Hyatt alleging, among other things, that the policy of requiring employees to sign an overly broad employee handbook acknowledgement violated the NLRA. Specifically, the acknowledgement contained the following statements at issue:

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 either Hyatt's Executive Vice-President/Chief Operating Officer or Hyatt's President.
In order to retain flexibility in its policies and procedures, I understand Hyatt, in its sole discretion, can change, modify or delete guidelines, rules, policies, practices and benefits in this handbook without prior notice at any time. The sole exception to this is the at-will status of my employment, which can only be changed in a writing signed by me and either Hyatt's Executive Vice President/Chief Operating Officer or Hyatt's President.

Ultimately, the complaint alleged that the provisions stating that the at-will employment status could not be altered except in writing and signed by a top Hyatt executive interfered with an employee's right to engage in protected concerted activity. The matter was settled in May 2012 without a decision and Hyatt agreed to amend its at-will language in its employment policies and revise its acknowledgement forms accordingly.

Similarly, in NLRB v. American Red Cross, (NLRB 2012), an Administrative Law Judge (ALJ) held that an overly broad at-will disclaimer violated the NLRA. The disclaimer at issue contained language stating "I further agree that the at-will employment relationship cannot be amended, modified or altered in any way."

The ALJ held that compelling employees to sign such an acknowledgement could be viewed as restricting an employee's rights to engage in protected concerted activities because the acknowledgement could be interpreted as "a waiver in which an employee agrees that his/her at-will status cannot change, thereby relinquishing his/her right to advocate concertedly" to change the employee's at-will status." The ALJ further held that "[f]or all practical purposes, the clause in question premises employment on an employee's agreement not to enter into any contract, to make any efforts, or to engage in conduct that could result in union representation and in a collective-bargaining agreement, which would amend, modify, or alter the at-will relationship. Clearly such a clause would reasonably chill employees who were interested in exercising their Section 7 rights." It was determined that the policy statement could be viewed as restricting employees from engaging in protected concerted activity and collective bargaining with the purpose of amending, modifying or altering the at-will employment relationship. The case was settled before the full NLRB had an opportunity to review it.

All employers must be cognizant of these recent developments since the NLRB is targeting not only unionized workplaces, but non-unionized workplaces as well since both union and non-union employees have a right under Section 7 of the NLRA to engage in protected concerted activity. Therefore, employers should be proactive by consulting with counsel and to review and, if necessary, revise their at-will disclaimers contained in employee handbooks, offer letters, and other personnel policies and documents to determine if those documents contain any language that may be viewed by the NLRB as overly broad and interfering with an employee's right to engage in protected concerted activity. Employers should also review the language contained in their employee handbooks to make sure that they do not state that an employee's at-will employment status can never be changed. Further, employers should clearly define at-will employment in any of the above-referenced documents in order to avoid a claim that the language is in violation of the NLRA.

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