NLRA Section 7

NLRA Section 7 was mentioned in Unit 15 and comes into play here as well. Previous guidance that was made through a June 6, 2018 General Counsel Memo was withdrawn in February, 2021. General Counsel Ohr stated that the Memo was no longer necessary given the number of NLRB cases interpreting The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017). Unfortunately, this is not altogether helpful. The Boeing panel advised that, when assessing if an employer’s rule potentially violated the NLRA, the NLRB should balance (1) the nature and extent of the potential impact on NLRA rights, and (2) legitimate justifications associated with the rule. The panel established three categories of rules:

  • Category 1 will include rules that the Board designates as lawful to maintain, either because ([a]) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or ([b]) the potential adverse impact on protected rights is outweighed by justifications associated with the rule. . . .
  • Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.
  • Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule. . . .

You can stay up to date in this area by keeping track of advice memoranda on the NLRB website.

In December 2020, the NLRB issued a decision on BMW Manufacturing Co.’s employee handbook where the Board applied the above rules. The Board commented on several different provisions within the handbook. 📖 Read the case so that you can see how the NLRB applied the “objectively reasonable employee” test to the policy language. I am only summarizing it below.

Attitude Toward the Company (Non-Disparagement Policy): The BMW handbook included policies requiring that employees “demonstrate respect for the company” and “not engage in behavior that reflects negatively” on BMW. The NLRB balanced the justifications for the policy and the impact on NLRA rights considering this a Category 1(b) Rule. The NLRB found that this policy was necessary to protect BMW’s interest and that finding against the policy would threaten loyalty that is essential to the employment relationship. I have a concern that the policy is vague and perhaps overly broad. I am not alone in this concern, as one NLRB member, Lauren McFerran, also shares my concern and expressed it in their dissent.

Civility (Offensive Language Policy): The BMW handbook requires that employees not “use threatening or offensive language.” The NLRB considered this a Category 1(a) and allowed the provision. I have no concern with this and think that policies that require civility and take a stand against offensive language can be effective in promoting a harmonious work environment. Of course, this policy is only effective if employees know of it and follow it.

No-Recording Policy (Device Use Policy): The BMW handbook states that employees must not “use personal recording devices within BMW MC facilities and not use business recording devices within BMW MC facilities without prior management approval.” The NLRB found, like in Boeing, that while the policy may potentially affect the exercise of Section 7 rights, the adverse impact is comparatively slight when compared to protecting BMW’s proprietary interests. (Category 1(b)). These policies have become quite common as you can imagine.

Confidentiality Policy: See Unit 15 for additional information on Confidentiality agreements and policies. The BMW handbook states that its confidentiality policy is limited to “the protection of confidential business information and trade secrets.” The NLRB said, “a reasonable employee would understand “personal and financial information” as a specific subset of confidential business information and trade secrets. Moreover, … the policy does not refer to employees’ personal and financial information, contact information, or other terms and conditions of employment that would be generally known or accessible from sources other than ‘confidential business information.’” The NLRB considered the BMW confidentiality policy in Category 1(a).


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To the extent possible under law, Samantha Prince has waived all copyright and related or neighboring rights to Entrepreneurship Law: Company Creation, except where otherwise noted.