Many employer handbooks and policies likely should be reviewed and revised following a landmark Aug. 2 ruling by the National Labor Relations Board (NLRB), Stericycle.

"This ruling, in a word, is huge," said David Pryzbylski, an attorney with Barnes & Thornburg in Indianapolis. "This decision may invalidate countless workplace rules maintained by private-sector employers—whether they are unionized or not. It applies to all companies covered by the National Labor Relations Act [NLRA], which is the vast majority of employers in America."

The NLRA does not apply to federal or state governmental units, railroads or airlines.

Employers need to create documentary evidence of the justification for their work rules before an unfair labor practice charge is filed, recommended Harry Johnson III, an attorney with Morgan Lewis in Los Angeles and former NLRB member.

New Standard

In Stericycle, an administrative law judge found that the employer violated the NLRA by maintaining certain rules for its employees that addressed personal conduct, conflicts of interest and confidentiality of harassment complaints. The NLRB announced a new standard for whether work rules violate the NLRA and sent the case back to the judge to consider the ruling in light of the new standard.

Under that standard, if an employee could reasonably interpret the work rule to have a coercive meaning, the NLRB general counsel would have met her burden to prove that the rule has a reasonable tendency to chill...

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