Section 7 of the National Labor Relations Act (NLRA) details employees’ rights to collectively engage in activities relating to worker protection, benefits, higher pay, and the like. It applies to both union and non-union employees.

In August 2023, the National Labor Relations Board (NLRB) ruled that if an employer’s policy can be “reasonably interpreted” to restrict employees’ Section 7 activities, it is unlawful. The decision, Stericycle, overturned a more employer-friendly test dating back to a 2017 NLRB ruling.

Read on to learn what this decision means for your workplace and your employee handbook.

The new standard

Effective immediately, the NLRB will evaluate employer rules by determining whether the rule or policy has a “reasonable tendency to chill [discourage] employees from exercising their Section 7 rights.” If so, it will be considered an unfair labor practice in violation of the NLRA. Additionally:

• The NLRB will now interpret rules and provisions with the view that the employee is economically dependent on the employer and in a vulnerable position relative to their employer.
• Rules may not be written in such a way that an employee would “reasonably interpret” them to restrict their Section 7 rights.
• Rules and provisions must be narrowly tailored to advance a legitimate and substantial business interest.

Once the NLRB determines that an employer rule or provision is invalid, the employer has an opportunity to contest the ruling.

Note that the new Stericycle standard is retroactive, meaning it applies to employer rules and handbook provisions that were written and applied even before August 2023.

What this means for you

While the NLRB generally exists to protect union-related and other concerted activities, its decisions also apply to businesses that do not employ union workers or operate in union-friendly states. Therefore, you must scrutinize your employee-facing rules, including the policies in your employee handbook, under the same standard the NLRB would. 

Carefully consider whether an employee could reasonably interpret any of your rules as discouraging their right to: 

• Speak to former or current employees
• Advocate for themselves
• Share their experiences
• Hire counsel 
• Engage in other activity protected by the NLRA

Remember that you must narrowly tailor your employee-facing rules to achieve a legitimate business purpose.

Questions? We’re here to help

Having well-vetted employer rules and a legally sound employee handbook is crucial to protecting your organization. Want to make sure you’re in compliance with all relevant rules and regulations? We’re here to help.