Last Gasp for Narrow Rules Review? NLRB Holds Hospital Badge Policy Unlawfully Prevented Employees From Wearing Union Insignia

Long Beach Memorial Medical Center (called "MHS"), an acute care hospital, had a policy for direct care providers that stated "[identification] badge reels may only be branded with [MHS] approved logos or text." A 2-1 majority of the Board held that, on its face, this limitation applied to all areas of the hospital. Inasmuch as hospitals may only limit union insignia in patient care areas, the Board determined that the policy was overbroad and unlawfully prohibited employees from wearing union insignia outside of patient care areas. While this decision appears to be a relic of the prior Democratic majority on the NLRB, it reminds healthcare employers to be precise in adopting rules against union insignia in patient care areas. More broadly, all employers should be careful not to limit union pins and badges without a legitimate business justification.

The Decision

Under well-established law, hospitals may restrict employees from wearing items bearing union insignias in patient care areas. MHS's "Appearance, Grooming and Infection Prevention Standards for Direct Care Providers" policy (the "Appearance Policy") required employees to wear identification badges that could be attached either to a uniform or to a retractable string pulley connected to a badge reel. Under the policy, badge reels also had to be branded only with MHS's approved logos or text.

Less than five months ago, in The Boeing Corporation, a new Republican majority of the National Labor Relations Board declared that the Board would review employer policies and rules based on a fair reading under all the circumstances. Listen to our previous presentation here. However, in the MHS decision, a three- member panel of the NLRB—that had a 2-1 Democratic majority—focused only on a single line of the Appearance Policy to find MHS' restriction on badge reels overly broad in violation of the National Labor Relations Act (the "Act"). Other provisions of the policy were clearly limited to those providing patient care, and the title of the policy expressly stated the standards were applicable to "Direct Care Providers." The majority stated that the Appearance Policy was facially unlawful because it prohibited employees from wearing a badge reel with a union insignia anywhere in the hospital and did not expressly limit this restriction to patient care areas. In so holding, the majority disagreed with the Administrative Law Judge's finding that the badge reel restriction was presumptively lawful because it only applied in patient care areas.

Member William Emanuel dissented concerning the Appearance Policy's restrictions on badge reels. He pointed out that the policy—when read as a whole and not only the particular badge reel sentence in a vacuum—made clear that it applied only to patient care areas. He also noted that the policy had never been applied outside patient care areas. His reading of the policy is more in line with the Board's Boeing decision that requires readings of policies in context. Member Emanuel also went further, finding that even if the policy was not limited to patient care areas, it was justified by MHS's desire to establish uniform rules to "prevent infections, insure that patients can readily identify their healthcare provider, and ‘promote an image of high quality, professional healthcare to the communities [the hospital] serve(s).'"

The Decision's Impact for Employers

As of April 16, 2018, Republicans have a full majority on the Board. Even with that majority, this decision is an important reminder for healthcare employers that dress code and appearance rules and policies restricting non-employer sanctioned insignias must be carefully restricted to patient care areas. The decision also carries broader implications for employers across all industries as a reminder that employer rules and policies deemed facially unlawful, or promulgated in response to union activity, are still targets under the Obama-Era precedents.

However, we must recognize that this case may be out of step from cases to come. The current majority is likely to review employer rules and policies with consideration of the full context, and make less of an effort to parse policies to find a violation of the Act. We will continue to report on the effects of the Board's decisions on employer rules.

What Should Employers Do Now

Knowing that the composition of the NLRB is never a sure thing, employers need to prepare their work rules for full scrutiny.

• Employers should carefully review their handbook policies and work rules to ensure they are facially neutral. Doing so will ensure that any analysis will fall under the Board's more favorable Boeing analysis and, under a Republican-majority board, should lead to more policies and rules being upheld.
• Healthcare employers should also take a close look at any dress codes and appearance policies to ensure that any insignia restrictions only apply to patient care areas. Specifically, each line of the policy should contain its own reference to the patient care areas limitations. The fact that other parts of the same policy contain the same limitation, including the policy's title, were not enough to withstand scrutiny in this case.