This decision by Administrative Law Judge Susannah Merritt concerns allegations that Detrex Corporation (Respondent) violated Section 8(a)(1) of the National Labor Relations Act (the Act) by maintaining and presenting severance agreements containing overbroad non-disparagement and confidentiality clauses. The Charging Party, United Steel, Paper and Forestry, Rubber Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL–CIO, CLC, is the certified bargaining representative for Respondent's packaging, maintenance, and operating employees.

The complaint alleged that by offering a severance agreement with these restrictive clauses to a terminated employee, Timothy Batanian, Respondent interfered with, restrained, and coerced employees in their Section 7 rights. Section 7 of the Act protects employees' rights to organize, bargain collectively, and engage in other concerted activities for mutual aid or protection, as well as the right to refrain from such activities.

The ALJ applied the legal standard established in McLaren Macomb, which holds that an employer violates Section 8(a)(1) by proffering a severance agreement with provisions that condition benefits on the forfeiture of NLRA rights, unless those provisions are narrowly tailored to respect the range of such rights. The McLaren Macomb decision overruled prior precedents that had allowed such agreements under certain circumstances, re-emphasizing that the language of the agreement itself and its potential to coerce are paramount.

The severance agreement in question contained a non-disparagement clause that broadly prohibited employees from making disparaging or defamatory remarks, orally or in writing, about the Respondent and related entities. The ALJ found this clause to be unlawfully broad because it failed to define "disparagement" or limit it to statements that lose the Act's protection due to disloyalty, recklessness, or malicious untruth, as required by Jefferson Standard Broadcasting Co. Furthermore, the clause lacked a temporal limitation and applied to an expansive list of individuals and entities, thus impeding employees' Section 7 rights to publicly discuss labor disputes and terms of employment.

Similarly, the confidentiality provision was deemed overbroad. It prohibited employees from divulging "Confidential Information," broadly defined to potentially encompass various terms and conditions of employment. The ALJ reasoned that without specificity, this clause could reasonably be interpreted by employees to prevent them from discussing their employment terms with coworkers, the Union, or the Board, thereby infringing on Section 7 rights.

Respondent raised several defenses, including arguments to overrule McLaren Macomb, that its agreement was lawful despite McLaren Macomb due to disclaimer language, and that modifying the agreement would constitute an unlawful unilateral change to the collective-bargaining agreement. The ALJ rejected the argument to overrule McLaren Macomb, stating that as an ALJ, she is bound by extant Board law. The disclaimer language stating that the agreement would not prohibit "activity protected under Section 7 of the National Labor Relations Act" was found insufficient because average employees lack the legal acumen to understand its implications, echoing the principle from Stericycle, Inc. that company rules are read from the perspective of non-lawyers. The ALJ also found that the savings clause on the first page of the agreement, which allowed employees to file charges with government agencies, was insufficient because it prohibited any form of recovery or compensation in such actions, which is unlawful under the Act as it undermines the Board's remedial processes. Finally, the ALJ dismissed the unilateral change argument, noting that severance agreement terms were not part of the collective-bargaining agreement and were not bargained over.

The ALJ also addressed Respondent's untimely defense under Section 10(b) of the Act, finding that the original charge adequately informed Respondent of the general nature of the violation.

In conclusion, the ALJ found that Detrex Corporation violated Section 8(a)(1) by maintaining and proffering the severance agreement with overbroad confidentiality and non-disparagement provisions that had a reasonable tendency to coerce employees in the exercise of their Section 7 rights. The ALJ recommended that Respondent cease and desist from these practices, rescind the offending provisions, and notify affected employees in writing.

Significant Cases Cited: * McLaren Macomb, 372 NLRB No. 58 (2023): The Board held that an employer violates Section 8(a)(1) by proffering a severance agreement with provisions that condition benefits on the forfeiture of employees' NLRA rights unless narrowly tailored to respect those rights. * Eastex, Inc. v. NLRB, 437 U.S. 556 (1978): This Supreme Court case established that Section 7 rights extend to employees seeking to improve their terms and conditions of employment through various channels, including public communications. * NLRB v. Electrical Workers Local 1229 (Jefferson Standard Broadcasting Co.), 346 U.S. 464 (1953): This Supreme Court case established that the protection afforded to employee communications under the Act is lost if the statements are so disloyal, reckless, or maliciously untrue as to lose the Act's protection. * Stericycle, Inc., 372 NLRB No. 113 (2023): The Board held that employer rules are evaluated from the perspective of a reasonable employee, who is presumed not to have legal expertise. * Kelly Services, Inc., 368 NLRB No. 130 (2019): The Board found language in a severance agreement prohibiting employees from receiving any form of recovery or compensation through Board proceedings to be unlawful under Section 8(a)(1) as it undermines the Board's remedial authority.

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