Whether or not employers are unionized, the National Labor Relations Board (NLRB) can evaluate the employer’s workplace rules and policies. On August 2, 2023, the NLRB in Stericycle, Inc., 372 NLRB No. 113 (2023), introduced a new legal standard for evaluating workplace rules under the National Labor Relations Act (“the Act”). This departure from previous standards marks a significant change for senior living operators and other employers. 

The prior standard, established by “The Boeing Co.” in 2017, categorized rules as either generally lawful or subject to a balancing test between employee rights and business needs. This replaced the “Lutheran Heritage Village-Livonia” standard from 2004, which viewed rules as unlawful if they “would reasonably be interpreted as” limiting protected activities—a standard that was used to attack a wide variety of employer handbook policies. 

Under the new Stericycle standard: 

Rule Assessment Shift: Workplace rules are scrutinized individually, with an increased focus on potential interference with employee rights. A rule will be presumed to be unlawful if it “could” be interpreted to limit employee rights, regardless of alternative interpretations that may be consistent with such rights. 

Perspective Change: Instead of evaluating from a “reasonable” employee perspective, the standard takes the viewpoint of an individual who is “economically dependent” on the employer and contemplating engaging in protected activities. Under the rules, the Board can consider rules from the perspective of a hypothetical employee who is fearful of engaging in protected activity. 

Economic Dependency: The standard assumes potential coercion from any rule that even remotely limits employee rights, based on the notion of economic dependency in the workplace. 

Employer Justification: To overcome the presumption of unlawfulness, employers must prove that a rule serves a “legitimate and substantial business interest,” and that no narrower rule can achieve the same objective. 

Practical Implications: Employers should reconsider their handbooks and policies as viewed through the lens of the current Board. Noncompliant policies may result in unfair labor practice charges or impact the outcome of organizing campaigns. Remember, the NLRB’s rules on policies apply to ALL workplaces, not just unionized workforces. 

What Senior Living Operators Should Do: 

Review Policies: Regularly assess workplace rules, aligning them with the new standard to prevent unintended interference with protected activities. 

Prioritize Organizing Efforts: When facing organizing campaigns, review policies before an election petition is filed. 

Demonstrate Business Justification: When defending a rule, show it aligns with legitimate business interests and that narrower alternatives aren’t feasible. 

This change necessitates proactive measures by employers to adapt their workplace rules to the Stericycle standard and ensure compliance with the evolving landscape of protected activities and employee rights. 

If you have any questions regarding this or any HR-related issues, please contact the Procare HR team. 

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