Most employers have and use at-will provisions in their employment agreements, handbooks, and acknowledgements. These provisions tend to state that the at-will nature of the employment is not subject to modification. However, in the last year employers have found that these provisions may be in violation of NLRA Section 7.
"The NLRB has now weighed in on these issues and these types of at-will disclaimers and has found some of them to be unlawful." Louis Klein told us in a recent BLR webinar. They found that some at-will provisions amount to prohibitions on an employee's Section 7 NLRA rights. NLRA Section 7 states: "Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection."
At-Will Policies and the NLRB: Case Examples
The case that brought this issue into the spotlight was the American Red Cross of Arizona case. American Red Cross Arizona Blood Services Region required employees to sign an acknowledgment that their employment was at-will, and "agree that the at-will employment relationship cannot be amended, modified or altered in any way."
On February 1, 2012, an Administrative Law Judge held that this provision was unlawful because it forced employees to waive their rights under Section 7. Because the provision did not allow for modification, the at-will disclaimer was found to be essentially a waiver of the employee's rights to advocate for better conditions.
In other words, by making an employee say they would not try to make any changes, this means they could not make any efforts or 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.
On the other hand, there have been several cases where at-will provisions have been deemed lawful by the NLRB. One such example was the Rocha Transportation case from October 31, 2012. Rocha's at-will provision stated:
"No manager, supervisor, or employee of Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will. Only the president of the Company has the authority to make any such agreement and then only in writing."
The court found that this provision cannot be reasonably construed to restrict Section 7 rights to engage in concerted attempts to change employment status. The provision does not require employees to refrain from seeking to change their at-will status; it simply prohibits the employer's own representatives from entering into employment agreements that provide for other than at-will employment. It still permits the company president to enter into modified employment agreements.
At-Will Policies and the NLRB: Practical Drafting Considerations
To stay in compliance with the NLRA and not restrict an employee's Section 7 rights, here are some practical drafting considerations for an at-will policy:
- At-will provisions should allow for the possibility of modification in some respect
- Only company representatives should be prohibited from seeking to modify the at-will relationship
- It should leave open the possibility to change employment status through a collective bargaining process
- Employers should consider adding limiting language that the policy does not restrict Section 7 rights
This information is excerpted from the webinar titled "NLRB Expands Its Reach: Why Even Non-Union Employers Need To Watch Out." To register for a future webinar, visit http://store.blr.com/events/webinars.
Louis C. Klein is of counsel in the Los Angeles office of Foley & Mansfield. He focuses his practice in employment matters.