NLRB Allows Employer Searches of Workers' Cars and Use of Communication Devices

In Verizon Wireless, decided June 24, 2020, the National Labor Relations Board held that employers have the right to search employees' personal property, including their vehicles, when on company premises. The Board also affirmed that employers may monitor employee activity on company issued communication devices, computer systems, and networks. This is a significant decision that continues to demonstrate how difficult it is for unions to win work rule cases under the Board's recently adopted Boeing standard.

The employer's work rule read:

In order to protect company assets, provide excellent service, ensure a safe workplace, and to investigate improper use or access… Verizon reserves the right to inspect, monitor and record the use of all company property, company provided communications devices, vehicles, systems and facilities – with or without notice – and to search or monitor at any time any and all company property and any other personal property (including vehicles) on company premises.

The administrative law judge who first heard the case found the rule was facially invalid under Lutheran Heritage. That case that set a standard that certain rules were unlawful if they could discourage employees from engaging in activities protected under Section 7 the National Labor Relations Act, because, for example, employees feared that searches would lead to evidence of that activity, like union authorization cards.

Shortly after the ALJ issued her decision, however, the Board issued its decision in Boeing, which overruled Lutheran Heritage and established a new standard for evaluating whether a facially neutral work rule violated the Act. Under the Boeing standard, the Board asks whether the work rule, reasonable interpreted, would interfere with the exercise of protect rights. If the answer is "no," the rule stands without further analysis. If the answer is "yes," the Board evaluates the rule using two competing factors: "(i) the nature and extent of the potential impact on NLRA rights, and (ii) legitimate justifications associated with the rule."

In Verizon Wireless, the Board applied the Boeing standard and rejected as "unsupported speculation" the ALJ's conclusion that the work rule could chill protected activity on the basis that "an objectively reasonable employee … would understand that the purpose of the rule is, as it states, to protect company assets, provide excellent service, ensure a safe workplace, and to investigate improper use or access." And because the rule merely "reserves the right" to search employees' personal property, and nothing in the text of the rule suggested that searches of employee vehicles would be frequent or routine, the possibility that such a search might one day occur and lead to employer "eavesdropping" was too "remote" to justify invalidating the work rule. According to the Board, the employer's interest in "prevent[ing] theft or other loss of assets" outweighed any "minimal impact" maintaining the rule would have on Section 7 activity.

The Board also held that employers could lawfully maintain work rules that allowed them to monitor employee activity on company issued communication devices, computer systems, and networks. In Caesars Entertainment, decided last year, the Board held that employees do not have a right to use employers' IT infrastructure to engage in protected concerted activity unless they have no other reasonable means of communicating with each other. In doing so, the Board deemed the maintenance of such work rules reasonable "[b]ecause an employer lawfully may monitor its employees' company-issued computers and devices for legitimate management reasons, it does not violate the Act to maintain a policy informing employees that their company computers and devices are subject to employer monitoring."

Take Home for Employers, and a Word of Caution

Verizon Wireless provides another illustration of how difficult Boeing has made it for unions to win work rule cases. Rules that would have been declared unlawful under the old Lutheran Heritage standard pass muster under Boeing. And as this case shows, the current Board will continue to issue employer-friendly decision, so long as the rule is facially neutral and supported by legitimate business needs.

That said, the adoption and implementation of work rules that involve employer-monitoring activity are not risk free.

For instance, Verizon Wireless does not answer whether frequent and routine searches of employee vehicles or other personal property would be sufficient to sustain a charge of unlawful employer surveillance. It only answers the question of under what circumstances the right to maintain such a work rule is lawful.

Searching employee property and monitoring employee use of company-issued communication devices may also mean than an employer acquires specific knowledge of individual employee's union support. Unions can use that knowledge to cloud grievance and arbitration proceedings by claiming unlawful retaliation, should the employer attempt to discipline that employee.

Additionally, time spent submitting to an employer's search of personal property may be compensable under various state wage laws. In February 2020, the California Supreme Court held that time spent submitting to a security/bag check was compensable under that state's laws.

Thus, while Verizon Wireless signals that the current Board will continue to issue employer-friendly decisions in work rule cases, work rules that involve employer monitoring-activity comprise a specific subset of work rules that are entangled in a complex legal landscape with overlapping labor and employment considerations. Employers should consult with their labor and employment counsel before drafting and implementing such work rules.