On August 1, 2023, the National Labor Relations Board issued a decision in Stericycle, Inc., overruling a prior 2017 decision which afforded employers more flexibility with their policies. This means that now certain categories of work rules, such as investigations/confidentiality rules, non-disparagement rules and rules prohibiting outside employment may not always be lawful to maintain.
The NLRB said in a press release that under Boeing‘s standard, employers were not required to narrowly tailor rules to promote legitimate and substantial business interests without unnecessarily burdening employee rights.
In summary, every workplace rule will not have to be designed to promote the Company’s legitimate and substantial business interests without being a burden to the employee or their rights. Employees have the right to challenge the policies, and the burden of proof for legitimacy lies with the Company.
“Under the new standard adopted in this ruling, the general counsel must prove that a challenged rule has a reasonable tendency to chill employees from exercising their rights,” the NLRB said. “If the general counsel does so, then the rule is presumptively unlawful.”
However, the employer may rebut the presumption by proving that the rule advances a legitimate and substantial business interest and that the employer is unable to advance that interest with a more narrowly tailored rule. If the employer proves its defense, the work rule will be found lawful to maintain.