Judge Rules “At-Will” Statement Violates The National Labor Relations Act
I have continually expressed to employers that they should ignore the “at-will” provision in terms of its concept. Meaning, it is a misunderstood concept in many respects. Employers believe that it can be used as a “catch all” for ending the employment relationship. No! The reason for termination should always be based upon violation of a company policy, practice, or procedure unless they simply cannot do the job. In either case, terminations should be based upon a valid documented reason and not simply that the employer has an “at-will” policy.
Now the National Labor Relations Board (NLRB) has issued an administrative decision holding that standard at-will language in a non-union Employee Handbook violates section 7 of the National Labor Relations Act. The Employee Handbook stated “I further agree that the at-will employment relationship cannot be amended, modified or altered in any way.” This is standard language in many employee handbooks (some employers write that it can only be modified by a writing signed by the employee and chief executive of the employer). The NLRB administrative law judge found that the language violates section 7 because employees who read it are very likely to believe that they cannot alter the at-will employment policy through collective bargaining or other forms of concerted activity. Subsequent to this decision, the NLRB issued a complaint against Hyatt Hotels on similar grounds. That complaint was resolved when Hyatt agreed to modify the at-will language in its handbook. From the author’s view, this decision and the NLRB’s position appears to be a stretch. However, right now it appears to be the only decision by the NLRB (or any other court or agency) on the issue. In addition, NLRB Acting General Counsel Lafe Solomon is reported to have publically commented in June that he believes that at-will handbook provisions prohibiting any change in the terms and conditions of employment except in a written document with a company executive violate the NLRA’s Section 7 right to participate in union-organizing activities. Thus, at a minimum, employers with standard at-will language like this in their employee handbooks should continue to monitor this situation and consider contacting their legal counsel to determine if any changes should be made to the at-will language in the handbook.
The NLRB decision was issued by Gregory Meyerson, an administrative law judge with NLRB Region 28 in Arizona in the matter of American Red Cross Arizona and Lois Hampton and Hyatt Hotels Corporation and United Here International Union. Take heed, we know that the NLRB is being controlled by the Obama administration who does not appear to favor business. I will keep you informed if any drastic changes need to be made.