Recently, the National Labor Relations Board (NLRB) in Tesla Inc., 370 NLRB (2022) ruled that employers cannot prevent employees from displaying union insignia or wearing union apparel unless they can prove “special circumstances” justifying the restriction. The board’s new standard overturns the precedent established in Wal-Mart Stores, Inc., 368 NLRB No. 146 (2019) which previously held that the “special circumstances” test applied only when an employer essentially prohibited the wearing of union insignia. Under the old rule, lesser size-and-appearance restrictions on union insignia could be considered lawful based on routine employer interests. For example, under the Wal-Mart standard, a workplace policy banning employees from wearing union hats could be permitted if the employer had a legitimate reason for doing so and still allowed employees to wear smaller union buttons.

The new standard, however, finds that even facially neutral workplace dress codes and uniform policies that prevent employees from wearing pro-union apparel of any type are presumptively unlawful – driving home the board’s position that employees have a protected right to display union insignia under the National Labor Relations Act (NLRA).

The policy at the center of the Tesla dispute was the company’s “Team-Wear” policy that required production employees to wear black shirts imprinted with the Tesla logo. The policy implicitly banned black shirts with other logos, including union logos, in place of the Tesla-provided shirts and only permitted all black shirts with no logos, upon supervisor approval. The policy did, however, allow employees to wear union stickers on their required Team Wear. Tesla argued that its dress code was meant to prevent clothing from mutilating cars and that employees were still free to display other sorts of union insignia on the job. These arguments failed.

Ultimately, the board found that no special circumstances existed and that Tesla failed to show how cotton shirts with non-Tesla logos pose a “mutilation risk to the unfinished vehicles.” The NLRB justified its decision by stating, “[w]earing union insignia, whether a button or a t-shirt, is a critical form of protected communication. For many decades, employees have used insignia to advocate for their workplace interests – from supporting organizing campaigns, to protesting unfair conditions in the workplace – and the law has always protected them.” 

What Employers Need to Know:

This Tesla ruling is critical because it applies to all employers, regardless of whether the employees are unionized or not. Uniform policies have always been of significant interest to unions, and it can be expected that unions will act quickly to seek to enforce this new “right.” To ensure compliance with the law, employers must closely examine their existing dress code and uniform policies and familiarize themselves with the permitted and prohibited conduct under the Tesla decision. Here is what is important to know:

New Rule: When an employer interferes in any way with its employees’ right to display union insignia, the employer must show “special circumstances” to justify its interference. Interference can be as simple as publishing a uniform policy.

What are Special Circumstances?

Special circumstances allowing restrictions on employees’ right to wear union insignia have been found when wearing insignia could:

• Jeopardize employee safety;
• Damage machinery or product;
• Exacerbate employee dissension;
• Unreasonably interfere with a public image that the employer has established; or 
• When necessary to maintain decorum and discipline among employees. 

The exceptions are likely to be narrowly construed, especially while the board remains in Democratic hands. While cases of this type will be extraordinarily fact-specific, some past examples of “special circumstances” justifying a policy include:

• Employee Safety. Special circumstances were found to prevent an employee from wearing a union key chain on his shirt pocket because employees worked around machinery that had several cams, levers, and gears in which the keychain could become entangled, possibly drawing the employee into the machine’s moving parts. Kendall Co., 267 NLRB 963 (1983).
• Workplace Safety. Special circumstances existed permitting the employer to prevent unauthorized stickers, including union stickers, from safety hats because the stickers could have interfered with the ready visibility of the safety hats – compromising the employer’s strategy to promote plant safety. Albis Plastics, 335 NLRB 923, 925 (2016).
• Potential Defect in Products. Special circumstances justified prohibiting employees from wearing a union pin because the pin could cause defects in the hosiery produced by the employer. Hanes Hosiery, Inc. 219 NLRB 338, 347 (1975).
• Potential Employee Disruption. Preventing employees from wearing union pins given to “loyal” strikers because the employer reasonably feared that the pins would promote disorder and incite further divisiveness between the strikers and non-strikers following an acrimonious strike was a special circumstance. United Aircraft Corp. 134 NLRB 1632, 1633-35 (1961).
• Maintaining an Established Public Image. An employer was justified in suspending employees who refused to remove union hats in the interest of maintaining an established public image that the employer created as part of its business plan through employee appearance rules. Con-Way Central Express, 333 NLRB 1073, 1076-77 (1999). The board examined whether the uniform requirement was (i) immersed in the company’s marketing philosophy, (ii) whether the company’s uniform was one method of distinguishing its service from that of its competitors; (iii) whether employees knew the uniform policy was used to distinguish the company’s employees from competitors and (iv) how long the policy had been in place.
• Employer Ambiance. Special circumstances existed when an amusement park prohibited its employees from wearing union pins in public areas because the pin interfered with the park’s ambiance that the employer sought to create through a “trendy, distinct and chic look” for its employees. W San Diego, 348 NLRB 372, 372-73 (2006).
• Customer Confusion. Special circumstances were found where supermarket employees were prevented from wearing hats and shirts with the union slogan “Don’t Cheat About the Meat!” because the slogan reasonably threatened to create concern among the supermarket’s customers about being cheated. Pathmark Stores, 342 NLRB 378, 379 (2004).
• Mocking the Employer’s Business. Special circumstances were also found prohibiting employees from wearing union shirts that said, “If it’s not Union, it’s not Kosher” because it mocked the employer’s Kosher policy which the employer, a bagel company, followed strictly and featured prominently on its logo and shirts. New York Bagels, 324 NLRB 266, 275 (1997).

The “Special Circumstances” Rule is a Balancing Test.

Merely identifying a special circumstance is not enough. To justify a ban on union insignia in the workplace, an employer must show that its right to maintain discipline or achieve other business objectives under special circumstances outweighs an employee’s right to engage in the union-protected activity.

Next Steps for Employers:

In the months to come, employers should expect more decisions like Tesla from the NLRB. Employers are encouraged to review existing uniform policies and take the following next steps:

• Alert management of the Tesla ruling and ensure they are not wrongfully taking disciplinary action against employees who wear union apparel/insignia instead of company-provided apparel prior to contacting counsel to discuss the facts of the case;
• Examine current uniform rules and policies, including those listed in your employee handbook, and determine whether the policy carves out exceptions for union insignia; and,
• Identify whether a special circumstance exists for justifying your uniform policy.

Taft will continue to monitor more NLRB decisions like Tesla. For more specific information about NLRB updates, uniform policies, or any other labor-related questions, contact the authors or any member of Taft’s Employment and Labor Relations group.