On June 6, 2018, the General Counsel of the National Labor Relations Board published a memo regarding employer handbook policies. On December 14, 2017, the NLRB issued a new guidance based on the cases in The Boeing Company, 365 NLRB No. 154. This memo is important in determining whether language contained in an employee handbook would give rise to an Unfair Labor Practice.
In Boeing, the Board analyzed previous decisions regarding the legality of employee handbook rules. Following the board’s decision Boeing, the General Counsel of the NLRB has created a guide to help understand and apply the new rules which stem from this decision. A new standard evolved from Boeing involving balancing the potential impact of the rule on the rights of employees against the employer’s justification for implementing a rule.
The decision creates three categories “work rules” may fall under:
• generally, rules in the first category are lawful. They include those requiring civility and authorization to speak on behalf of the employer and preclude the disclosure of confidential customer information;
• rules in the second category call for “individualized scrutiny.” Examples include those regulating off-duty conduct, confidentiality and conflicts of interest; and
• rules in the third category constitute those that remain unlawful. Examples of rules which remain unlawful include those against joining outside organizations or that require employees to keep the terms and conditions of their work confidential.
These changes are solely in regards to the rules employers may construct and include in their employee handbooks. It is important to remember that this memo merely represents guidelines. The memo is not binding. Rather, the. Memo only provides insight as to how the General Counsel will determine whether or not to dismiss charges on handbook policies without a hearing.
If you or someone you know needs help interpreting, drafting, or determining the legality of language contained in an employee handbook, contact Gilbert Law Group today.
Contributed by Nicole Mattern
The United States Court of Appeals for the 2d Circuit recently issued a decision that could potentially save certain business owners both money and stress. The 2d Circuit, which encompasses the states of New York, Connecticut, and Vermont, in a recently decided case (Saleem v. Corporate Transportation Group, Ltd.) provided guidelines for employers as to whether their workers are employees or independent contracts. The issue of classification of workers as an employee or independent contractor is significant. For example, an independent contractor is exempt from minimum wage and overtime requirements. Further, such a classification can have significant tax consequences for a business. The above-referenced case clarifies longstanding issues regarding classification workers as employees or independent contractors. The hope is that the by issuing said guidelines, the Court will help employers avoid troublesome allegations of misclassification.
The case involved a driver service and its workers. Corporate Transportation Group and its affiliate companies (CTG) run a black-car service in the New York City area. The Company requires its drivers to sign a contract that acknowledged they were “not an employee or agent” of the company “but merely a subscriber to the services offered” by CTG. The drivers filed a class action lawsuit against CTG seeking unpaid overtime pay pursuant to the federal Fair Labor Standards Act (FLSA) and New York state wage and hour law.
In its decision, the Court established a three pronged analysis for determining whether a worker is an independent contractor or an employee. The Court initially noted that any independent contractor misclassification dispute arising under the FLSA must be examined under an “economic realities” test. The Court then listed the following three factors to be crucial to its decision:
- The Drivers Had Entrepreneurial Opportunities Not Available to Employees;
- The Drivers Made A Heavy Investment In Their Business and;
- The Drivers Maintained A High Level Of Flexibility.
The Court cautioned however, that its ruling was based on the fact-specific “totality of the circumstances” comprising the relationship between CTG and the drivers in this specific case. “In a different case, and with a different record, an entity that exercised similar control over clients, fees, and rules enforcement in ways analogous to CTG might well constitute an employer within the meaning of the FLSA.”
As a result it is clear that each case is to be determined on a case by case basis. Further, there is a lot of gray area as to how each of the above-referenced guidelines may be applied to difference business. Each case can turn on several variables. It is always best to consult an experienced employment attorney. If you have questions regarding employee or independent contractor classificication status, or are facing potential misclassification issues, call Gilbert Law Group today at 631.630.0100.