The NLRB's Acting General Counsel Asserts an Unprecedented Challenge to Employee Handbook Receipt Provisions

The Acting General Counsel of the National Labor Relations Board ("General Counsel") recently issued a Complaint alleging that certain employee acknowledgments, routinely included in employee handbooks, violate federal labor law.  The challenged acknowledgements, set forth in the Acknowledgment of Employee Handbook used by Hyatt Hotels Corporation ("Hyatt") nationwide, are:

• "I understand my employment is 'at will;'"
• "I acknowledge that no oral or written statements or representations regarding my employment can alter my at-will employment status, except for a written statement signed by me and" one of two company executives; and
• "The sole exception to [a prior acknowledgment] is the at-will status of my employment, which can only be changed in a writing signed by me and" by one of two company executives.

The General Counsel asserts, in the Complaint issued on February 29, 2012, by the Phoenix Regional Office of the National Labor Relations Board ("Board"), that these statements are overly broad and, therefore, violate Section 8(a)(1) of the National Labor Relations Act ("NLRA").  The Complaint, based on an unfair labor practice charge filed by UNITE HERE International Union, does not allege whether the charging party represents Hyatt employees.  "As part of the remedy" for the alleged unfair labor practice, the General Counsel seeks an order requiring that Hyatt "on a nationwide basis at all of its facilities rescind and cease maintaining or enforcing the alleged unlawful" acknowledgements and "either 1) furnish all current employees with inserts for" its acknowledgments "that (a) advise that the unlawful rules, policies, or requirements have been rescinded, or (b) provide language of lawful rules, policies, or requirements; or 2) publish and distribute revised . . . acknowledgements that (a) do not contain the unlawful rules, policies, or requirements, or (b) provide the language of lawful rules, policies, or requirements . . . ."  The injunctive relief sought by the General Counsel is not limited to unionized Hyatt locations. 

Until the Complaint in this case issued, such routine employee acknowledgments had never been questioned, even in part, by the Board or its General Counsel.  The Complaint does not challenge the following employee representations, which are also set forth in the Hyatt employee handbook:

• acknowledgment of receipt of the handbook;
• agreement to comply with the handbook;
• understanding that the handbook is only a guide to the practices and policies of the company;
• acknowledgment that the policy is still in force and effect even if the company does not enforce it;
• understanding that "at will" employment means "I am free to separate my employment at any time, for any reason, and Hyatt has these same rights;"  and
• understanding that "Hyatt, in its sole discretion, can change, modify or delete guidelines, rules, policies, practices and benefits in this handbook without prior notice at any time."

This Complaint may be a prelude to a new Board enforcement target: long-settled state law principles of employment at will. 

We will continue to closely monitor this development, including the disposition of this Complaint.