November 2, 2012

NLRB’s Halloween at-will advice is not so scary

Posted in Acknowledgment, At-will Employment, Contracts, Disclaimers, Disclaimers, Employee Handbooks tagged , , , , , , at 10:28 am by Tom Jacobson

Wednesday was Halloween, and my neighborhood was crawling with trick-or-treaters. The scary part was not the kids or their costumes. Rather, it was the insomnia-inducing sugar rush I got after working quality control on the night shift.

Also on Wednesday, one scary trend in the world of employment law seems to have been averted. The trend was that in a couple of National Labor Relations Board (NLRB) cases, common at-will employment clauses were interpreted as violating the National Labor Relations Act. However, on Wednesday the NLRB’s Acting General Counsel, Lafe Solomon, issued an Advice Memo which analyzed two such clauses and reached the not-so-scary conclusion that they did not violate the Act.

In one case, a handbook which had been issued by Rocha Transportation of Modesto, CA included the following at-will clause:

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.

In the other case, the handbook used by Mimi’s Café in Casa Grande, AZ said:

No representative of the Company has authority to enter into any agreement contrary to the foregoing “employment at will” relationship.

The scary part was that in other recent NLRB cases, similar clauses were interpreted as being unlawful waivers of employees’ rights to engage in collective bargaining under the NLRA. If that trend were to continue, the at-will clauses in countless employee handbooks across the country would be subject to challenge.

However, the NLRB’s Halloween Advice Memo allays those fears somewhat by concluding in the Rocha case that because the at-will clause explicitly states that the relationship can be changed, employees would not reasonably assume that their NLRA rights are prohibited. Similarly, regarding Mimi’s Cafe, the Advice Memo notes that the at-will clause was not unlawfully broad because it does not require employees to agree that the employment relationship cannot be changed, but merely stresses that the employer’s representatives are not authorized to alter it.

What you need to know:  At-will employment generally gives employees and employers alike the flexibility to end their relationship at any time, with or without notice, and for any lawful reason. Handbook clauses like the ones noted above are intended to help preserve that status. However, if they are not properly drafted, or if they are inconsistent with an employer’s other documentation, the clauses may be unlawful or may not actually preserve the at-will employment relationship. Therefore, to ensure compliance, employers should have their at-will employment documentation reviewed by legal counsel.  

For more information about this article, please contact me at taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2012 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

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2 Comments »

  1. Ron K. said,

    Tom,

    Thanks for the information on these latest interpretations from the NLRB. Good information.


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