NLRB General Counsel Rescinds Guidance, Suggesting Employers Have Greater Flexibility in Agreements
In a significant change in the interpretation of federal labor law, the National Labor Relations Board’s (NLRB) Acting General Counsel William B. Cowen issued his first General Counsel memorandum on February 14, 2025, rescinding nearly all of the guidance memoranda issued under the prior General Counsel. Most notably, the Acting General Counsel rescinded guidance that limited the use of agreements containing non-competition, non-solicitation, confidentiality, and non-disparagement clauses with non-supervisory employees. In light of this change, employers should revisit template agreements and consider removing some of the protective language that was added in 2023 because of the prior General Counsel’s guidance.
The members of the NLRB decide cases, but the General Counsel of the NLRB is the agency’s lead prosecutor for the agency, which puts him in the critical position of deciding when and how to take action to enforce the National Labor Relations Act (NLRA). The General Counsel’s positions on how the NLRA should be interpreted and enforced are most frequently set out in memoranda, which speak to specific interpretations and issues. These memoranda are not law, but rather, the position of the General Counsel that issues them. As such, they are subject to being rescinded by successor General Counsel.
In 2023, the then-General Counsel issued a memorandum stating that confidentiality and non-disparagement clauses in severance agreements violate non-supervisory employees’ right to engage in protected concerted activity. In response to this guidance — and to avoid potential claims under the NLRA — many employers added broad carveouts and disclaimers in separation agreements that allowed non-supervisory employees to make disclosures and statements that otherwise would have been prohibited. In response, employers also revised policies and agreements regarding confidentiality, prohibiting taking photos and videos in the workplace, and proscribing responses to outside inquiries.
In February, the recently appointed Acting General Counsel rescinded these positions, which reverted it back to the 2023 guidance. This action suggests that the NLRB’s enforcement arm will look at whether a provision in an agreement was actually or was likely to prevent employees from engaging in protected activity, rather than whether it simply had the potential to do so.
While General Counsel memoranda don’t carry the force of law or regulation, they do establish agency priorities and provide direction on how to interpret the NLRA. In light of the Acting General Counsel’s recent activity, employers should revisit the “carve outs” and disclaimers that were added to agreements, handbooks, and other policies in the last two years to see whether they should be deleted.
Bottom Line
This is a potential opportunity for employers to reassess — and strengthen — some of the language in standard agreements and policies. However, the landscape remains in flux. Companies should work with their legal counsel to understand how these changes may impact specific workplace policies and practices, particularly when it comes to employment agreements, confidentiality, non-solicitation, and non-competition agreements and severance agreements, and to determine how the changes in the NLRB enforcement priorities and other employment regulations should play a role in making any changes.
Additional guidance is likely forthcoming that will further clarify enforcement priorities and interpretations of federal labor law. We are watching all developments closely.
Questions about where things stand with the NLRB? Please reach out to Laura Friedel or another member of Levenfeld Pearlstein’s Employment and Executive Compensation group for more information.