Employers may need to take another bite at policies: Lessons from a recent NLRB Chipotle decision

October 06, 2016

Employment Law Alert

Author(s): Andrew B. Prescott, Jessica Schachter Jewell

Several of Chipotle Mexican Grill’s employment policies came under the knife recently after the national burrito chain’s response to an employee’s rogue tweets landed it in hot water with the National Labor Relations Board.

Chipotle Mexican Grill’s (“Chipotle”) response to an employee’s rogue tweets recently landed the national burrito chain in hot water with the National Labor Relations Board (“NLRB”).[1] Significantly, it was not just Chipotle’s alleged response to this employee’s conduct that proved problematic for the restaurant. The NLRB’s General Counsel challenged a handful of Chipotle’s employment policies, the majority of which had no bearing on the issues at hand. Ultimately, the NLRB, adopting the decision of the administrative law judge in pertinent part, determined that certain provisions were unlawful, while others avoided the knife.

Social Media Policy

The Contested Language

“If you aren’t careful and don’t use your head, your online activity can also damage Chipotle or spread incomplete, confidential[,] or inaccurate information.”

“You may not make disparaging, false, misleading, harassing[,] or discriminatory statements about or relating to Chipotle, our employees, suppliers, customers, competition, or investors.”

The Verdict

Chipotle’s warning to not spread “confidential” information on social media was problematic. The NLRB deemed the undefined term to be vague and said an employee could easily interpret the policy to bar protected conduct.

Further, the NLRB also deemed the prohibition on making “disparaging, false, [or] misleading” statements “about or relating to Chipotle, our employees, suppliers, customers, competition[,] or investors” on social media unlawful. The NLRB reiterated that employers cannot prohibit employee postings that are “merely false or misleading” – that an employee’s statements had to have a malicious motive to lose the protection of the National Labor Relations Act.

The NLRB noted that Chipotle’s savings clause at the end of its social media policy – “This code does not restrict any activity that is protected or restricted by the National Labor Relations Act, whistleblower laws, or other privacy concerns” – was insufficient to cure the unlawfulness of the foregoing provisions.

The NLRB did determine that Chipotle was within its rights to prohibit “harassing or discriminatory statements.” Although Chipotle did not define these terms, the NLRB relied on previous decisions discussing similar language that it found to be lawful.

Solicitation Policy

The Contested Language

“Employees are not to solicit or be solicited during their working time anywhere on company property, nor are they to solicit during non-working time in working areas if the solicitation would be within visual or hearing range of our customers.”

The Verdict

The NLRB noted that it had previously held a prohibition of solicitations during non-working time to be lawful where the solicitation would interfere with sales and disrupt the business. The NLRB held that the policy went too far here because such a prohibition would encompass situations that would have no impact on the business or interrupt sales (e.g., if a customer saw employees engaged in solicitation in the parking lot, there would be no impact on the business, but that activity would be barred under the rule).

Confidential Information

The Contested Language

“The improper use of Chipotle’s name, trademarks, or other intellectual property is prohibited.”

The Verdict

The NLRB did not find the prohibition of the commercial use of Chipotle’s logo or trademark to be an unreasonable restriction, but did find the bar on using Chipotle’s name to be a different story. The NLRB found that employees would reasonably interpret any non-work-related use of Chipotle’s name to be improper under the broad policy, and therefore the NLRB determined that this policy violated the National Labor Relations Act.

Ethical Communications

The Contested Language

“As an aspect of good judgment and adherence to this policy, it is always appropriate to raise questions and issues, even if they are difficult. Likewise, avoid exaggeration, colorful language, guesswork, and derogatory characterizations of people and their motives. Whether in your everyday work conversations, in your exchange of e-mail, or otherwise, your communications should be thoughtful and ethical. Think before you speak and write. Be clear and objective.”

The Verdict

The NLRB found the portions of this policy prohibiting “exaggeration, guesswork, and derogatory characterizations of people” to be unlawful, but held that Chipotle had the right to prohibit “colorful language” because the NLRB noted that the term encompasses language that is considered to be vulgar, rude, or offensive. The NLRB has previously determined that employers may prohibit the use of offensive, demeaning, abusive, or similar language.

Political/Religious Activity and Contributions

The Contested Language[2]

“While any political or religious affiliation you may have is up to you, any activity in those areas needs to remain outside of the work environment. It is said that to avoid arguments, one should never discuss politics or religion in public – and in this case at work … It is strictly prohibited to use Chipotle’s name, funds, assets, or property for political or religious purposes or endorsement, whether directly or indirectly.”

The Verdict

The NLRB commented that the exercise of Section 7 rights often involves political activity. The NLRB held that the prohibition on discussing politics in the workplace would prevent employees from engaging in a wide variety of protected activities, including discussing obvious topics such as legislation aimed at improving employee working conditions, candidates’ positions on work-related matters (including the federal minimum wage), right-to-work legislation, and the benefits of unionization, to name a few. Therefore, the prohibition against discussing politics in the workplace violated the Act.

While the NLRB noted Chipotle’s interest in protecting its name from being used improperly or fraudulently in the political arena, the NLRB held that blanket prohibition against using the Chipotle name for political purposes was simply too restrictive. For example, the “Fight for 15” movement could reasonably interpret this rule as prohibiting them from carrying signs identifying Chipotle as the employer of some of its members.

Takeaways for Employers

Some of these conclusions might be difficult to swallow for employers, but the Chipotle decision, along with prior decisions about employer policies, provides important guidance.

  • Wherever possible, employers should define terms (even ones that seem obvious, such as “confidential”) to avoid a policy or policies being deemed unlawful.
  • Seemingly bad behavior – like telling lies, providing false information, or even disparaging someone – may be protected conduct. Unless an employee specifically intends to harm (i.e., acts maliciously), otherwise-protected conducted will remain protected. Employers should draft policies accordingly and train managers properly on the difference between protected and unprotected conduct.
  • General policy statements that employees’ legal rights will not be affected don’t help much. Savings clauses or reserved rights provisions should be more specific (e.g., “Nothing herein will affect an employee’s rights to discuss the terms or conditions of his or her employment with other employees or third parties”). Such specificity would make it less likely that an employee would reasonably believe protected conduct is prohibited.
  • An employer cannot prevent employees in most workplaces from exposing customers or clients to protected conduct. An employer should draft policies narrowly to prohibit only conduct that would interfere with the employer’s operation or damage the public’s perception of the employer’s goods and services.
  • Time and time again, employers’ policies are deemed unlawful because of the use of broad or vague language. In this case, the NLRB stated that the prohibition of the general use of an employer’s name will be deemed unlawful. Be sure to be precise about what is, and what is not, allowed as best you can. This will mean giving careful thought to why you have certain policies in place and not simply using canned versions.
  • In light of the upcoming general and local elections, employers may want to prohibit talk of politics in the workplace. Although employees do not have a First Amendment right to speech when they are on private – their employer’s – property, they do have rights under the Act. While employers have a legitimate interest in protecting their names from being used improperly in the political arena, the NLRB deems a broad ban on all political discussions an unlawful intrusion on employees’ rights under the Act. Although it may seem enticing to keep the Trump v. Clinton conversations out of the workplace, employers should think twice before enacting such a policy.  

Given this decision, it might be time for employers to review their own employee handbooks – whether it is just a handful of policies or the whole enchilada.

  1. The employee in question had sent out a couple of tweets in response to customer comments about Chipotle’s free food and guacamole, stating “nothing is free, only cheap #labor. Crew members only make $8.50hr [sic] how much is that bowl really?” and “It’s extra not like #Qdoba, enjoy the extra $2[.]”
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  2. The NLRB only reviewed the language pertaining to political activity.
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The foregoing has been prepared for the general information of clients and friends of the firm. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel. If you have any questions or require any further information regarding these or other related matters, please contact your regular Nixon Peabody LLP representative. This material may be considered advertising under certain rules of professional conduct.

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