The timeless advice given to Oregon employers about including at-will disclaimers in their employee handbooks will become a thing of the past if the National Labor Relations Board has anything to say about it.
According to the National Labor Relations Board (“NLRB”), employers who require employees to sign acknowledgements of their at-will status (typically those found in an acknowledgement of receipt of employee handbook form) are “interfering with, restraining and coercing employees in the exercise of the rights guaranteed in Section 7” of the National Labor Relations Act (“NLRA”). In fact, the NLRB issued a complaint and notice of hearing against the Hyatt Hotels Corporation earlier this year for, among other reasons, including an “overly-broad and discriminatory acknowledgement form” in its employee handbook that states in part:
I understand my employment is ‘at will.’ This means I am free to separate my employment at any time, for any reason, and Hyatt has these same rights. Nothing in this handbook is intended to change my at-will employment status. 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 re Hyatt Hotels Corp., NLRB Case No. 28-CA-061114. The NLRB’s position tracks a February 2012 Decision in which an administrative law judge ruled that the American Red Cross Arizona Blood Services Region violated the NLRA by requiring its employees to sign an “Agreement and Acknowledgement of Receipt of Employee Handbook” which included language similar to that used by Hyatt. See In re American Red Cross Arizona Blood Services Region, Case No. 28-CA-23443.
In sum, the NLRB takes the position that employees should not be “coerced” into signing such an “acknowledgement” because by doing so, the employee essentially waives his or her rights to change his/her at-will status. The NLRB further argues that with such a waiver, the employee effectively relinquishes his or her rights to advocate as part of a group (regardless of whether the employee is part of a union) to change their at-will status. As the administrative law judge in the Red Cross case noted:
For 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 seven rights.
Unfortunately for employers, neither the Hyatt nor the Red Cross cases will undergo judicial scrutiny because both employers agreed to enter into settlement agreements with the NLRB that ended the cases. Thus, it is unclear whether an administrative law judge’s decision and a complaint issued from one NLRB region (Region 28, which does not include Oregon) will have any impact on employers elsewhere in the country. What is clear, however, is that employers should not view the settlement/compliance agreements reached in those cases as legal authority or even legal “precedent” that binds them, even though both agreements called for Hyatt and the American Red Cross Arizona Blood Services Region to eliminate the language in question from their acknowledgement forms.
Employer Takeaway: It is important to note that nothing issued or stated by the NLRB thus far indicates that employers should completely stop using at-will language in their employee handbooks. In fact, the language at issue in the Hyatt and Red Cross cases was not contained within the companies’ respective handbooks, but in the handbook acknowledgement of receipt form the employees were asked to sign when they received the handbooks. Thus, Oregon employers should continue to include language in their handbooks (ideally at or near the beginning of the handbook) indicating that the employment status of the employer and its employees is “at will.” Even if the NLRB begins to focus on such language in the future, the risk to and consequences for employers of such legal scrutiny pales in comparison to the impact of losing at-will protection if the necessary language is omitted from the handbook. At this point, employers receive more value by continuing to rely on and publicize Oregon at-will principles of employment as opposed to eliminating such language altogether out of fear of future NLRA violations.
Instead, employers may wish to review their acknowledgement forms to determine if the at-will language used in those forms tracks the language the NLRB found so “problematic” in the Red Cross and Hyatt cases. Because it is unclear how a federal court would view the NLRB’s approach to the at-will issue, employers could very well be justified in leaving their handbook acknowledgement forms as-is. Alternatively, employers with concerns over NLRB scrutiny could leave their acknowledgement forms as-is but add language to the effect that nothing in the acknowledgement form or the handbook was intended to discourage employees from exercising their rights under the NLRA. Although the NLRB has repeatedly frowned upon similar disclaimers with respect to social media policies, such a disclaimer has not been legally tested in the at-will language context.
Tamara E. Russell is a partner with Barran Liebman LLP, an employment, labor and employee benefits law firm. Tamara has represented and advocated on behalf of employers and companies for more than 15 years. For more information about the contents of this article, please contact Tamara at trussell@barran.com or 503-228-0500.
