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Labor & Employment Law Alert: The NLRB, the Impact of the Election, and Following Up on Storm Sandy

November 7, 2012

Labor & Employment Update

1. The NLRB Acting General Counsel Approves Two "At Will" Employment Statements in Recently Issued Advice Memoranda

At our recent Annual Labor & Employment Law Seminar we discussed two National Labor Relations Board (NLRB) cases involving "at will" employment disclaimers. The cases caught the attention of employers and created a storm of controversy. In one case, an Administrative Law Judge (ALJ) held that an at will disclaimer in an American Red Cross affiliate’s employee handbook was unlawfully broad. Several weeks later, a NRLB Regional Director issued a complaint against Hyatt Hotels Corp. on the same basis.

Last week, the Acting General Counsel issued two advice memoranda that found other at will language to be lawful. SWH Corporation d/b/a Mimi’s Café, Case No. 28-CA-084365; Rocha Transportation, Case 32-CA-086799.

In the earlier Red Cross decision, the ALJ held that requiring employees to sign a form that contained the following language was unlawful: "I further agree that the at will employment relationship cannot be amended, modified or altered in any way." The ALJ reasoned that this was "essentially a waiver" by employees of their right to form or join a union to bargain with the employer to change that status.

In last week’s advice memoranda, the Acting General Counsel found the following language from the Rocha and SWH Corp. at will disclaimers, respectively, to be lawful:

"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 writing."

"No representative of the Company has authority to enter into any agreement contrary to the foregoing ‘employment at will’ relationship."

According to the advice memoranda, Rocha’s and SWH Corp’s language is lawful because it does not state that the at will status cannot change or that employees are prohibited from seeking to change their at will status.

Although the distinction is subtle, the key is that at will disclaimers are permissible if they do not prohibit employees from seeking to modify their at will status. Although these cases are not NLRB decisions, the NLRB likely would follow the Acting General Counsel’s reasoning. As such, employers should work with counsel to review and revise their current "at will" disclaimers.

2. Impact of Election

As also noted at our recent seminar, the Affordable Care Act (ACA) is the law. Employers should be taking steps to comply with the provisions already in effect and plan for the major changes scheduled for 2014. It is now highly unlikely that the law will be repealed, and we expect many new regulations to be issued interpreting and implementing the ACA’s numerous provisions.

In light of President Obama’s re-election, we further anticipate that the various federal agencies regulating the workplace (e.g., NLRB, U.S. Department of Labor, Equal Employment Opportunity Commission) will continue to be very active.

3. Following Up on Storm Sandy

Since Storm Sandy hit last week, we have fielded numerous questions from our clients regarding wage and hour and benefits issues regarding storm-related absences. As the winter approaches, it is a good time for employers to review their obligations under applicable law, and to review and revise their written policies regarding storm-related absences.