By Dan Cohen – 4/11/16
On April 7, 2016, Quicken Loans and several of Dan Gilbert’s other businesses were ordered to make 24 changes to their employee rules by Administrative Law Judge David Goldman because the rules were overly broad and violated Section 8(a)(1) of the National Labor Relations Act. Section 8(a)(1) prohibits employers from interfering with, restraining, or coercing employees in the exercise of the rights guaranteed in Section 7 of the Act. According to Judge Goldman, the 24 work rules infringed upon employee rights to engage in concerted activities, including the right to discuss, debate, and communicate with each other regarding their workplace terms and conditions of employment.
Quicken argued that the employee manual (a/k/a “the Big Book”) had limited use, had only been distributed to some employees, was not used or relied upon by managers and that the manual played no active role in the employees’ work life. Quicken’s arguments were rejected because the evidence established that nothing amended or contradicted the offending rules and employees were not advised that they could engage in the conduct prohibited by the manual. According to ALJ Goldman, “once offending rules are placed in an employer-developed employee rulebook and distributed to employees, it takes forceful and specific countervailing evidence of their disavowal to strip them of their tendency to coerce.”
Turning to the language of the manual, Judge Goldman found 24 rules and statements to violate the NLRA and ordered Quicken and the other companies to cease and desist from maintaining the following overly broad rules that:
- Prohibit disclosure of unspecified “confidential information” in the employee handbook;
- Prohibit employees from knowingly making false or misleading EEO complaints or EEO complaints in bad faith;
- Require employees making complaints or participating in investigations to agree to maintain confidentiality;
- Require employees to dress and conduct themselves in a professional manner;
- Require employees to keep non-public financial or operational information confidential;
- Require employees to resolve work-related concerns by speaking to team leaders and not taking it on-line;
- Prohibit employees from displaying information that could be deemed harmful or offensive to the reasonable person;
- Prohibit unauthorized postings and solicitations on company property;
- Discourage emails that reflect unfavorably on the company and its reputation;
- Prohibit non-business activities on company property;
- Prohibit email use for activities other than company business;
- Require employees to direct all press inquiries about the business and its directors to corporate communications persons;
- Define confidential information as non-public information about the business, personnel, customers, operations and affairs;
- Prohibit use of company resources which presents a threat of harm to the company or its reputation;
- Prohibit conduct that is not in the best interests or the company, its clients or team members;
- Prohibits signature lines with religious, political, sexual or other inappropriate content;
- Prohibit employees from using personal web pages or sites that reference the company or which disclose information about the company without the permission of the marketing team;
- Prohibit employees from sending non-business related attachments to emails or communicating with the media without express authorization from the corporate communications team;
Quicken has indicated it will appeal the ALJ’s decision to the full NLRB, and if necessary, to federal circuit court. Given the track record of the NLRB, I would not expect a reversal. But, in order to move the case away from the Agency and into court, Quicken must exhaust its administrative remedies. Thus, taking an appeal to the anti-employer NLRB must occur before Quicken is likely to get a fair shake.
While we applaud Mr. Gilbert and his efforts to fight what is clearly government overreach, we have been advising businesses now for several years on how to re-write many of the above rules in a way that protects important business rights and values without becoming fodder for the NLRB. Employers can still protect confidential information without prohibiting discussions about wages and benefits. And, employers can still prohibit misconduct without labeling it as unprofessional, not in the company’s best interest or that which reflects unfavorably on the business. Of course, some of the opinions are more troubling than others and hopefully Mr. Gilbert will have success once he can make his arguments in federal court. However, re-writing many of the work rules will save you defense costs, and disarm unions from using the unfair labor practice findings against your business in a union organizing drive or otherwise. And, it will spare you the requirement of posting notices at your facilities for 60 days, which advise employees you violated federal law and reminds employees of their right to unionize.