What Small Business Owners Must to Know to Avoid NLRA Claims

You walk in and hear your employees discussing their pay. You immediately tell them they are not allowed to discuss confidential information like their pay with each other. Guess what? You have just committed an unlawful act in violation of the National Labor Relations Act (NLRA).

When small business owners hear about the NLRA, the assumption is it only applies to unionized workplaces. That’s a costly mistake. The NLRA protects employees’ rights whether or not a union is involved, and failing to comply can result in legal claims, fines, and reputational damage.  Let's cut through the legal jargon and talk about protecting your business from NLRA claims and how to avoid violations and costly legal battles.

What is the NLRA?

The NLRA is a federal law that protects employees' rights to: 

✔️ Discuss wages, benefits, and working conditions with coworkers.

✔️ Engage in "protected concerted activity" (acting together to improve workplace conditions).

✔️ Organize, form, join, or assist labor unions. 

✔️ Refuse to participate in union activities. 

The law applies to most private-sector employers, including small businesses (including those non-unionized). The law does not cover government employees, agricultural laborers, independent contractors, and supervisors (with limited exceptions). 

Common NLRA Violations Small Businesses Make 

Even without a union, small business owners can still face NLRA claims if they: 

• Implement Overly Restrictive Workplace Policies 

  Policies that ban employees from discussing pay, workplace concerns, or working conditions may be illegal under the NLRA. Social media and confidentiality policies that prohibit employees from speaking out about work issues can also violate the law. 

• Punish or Retaliate Against Employees for Complaining About Work 

  If employees talk about unfair treatment, pay, or work conditions with coworkers (even on social media), disciplining, demoting, or firing them for this can be a major NLRA violation. Even indirect retaliation (like cutting hours or changing job duties) can trigger an NLRA claim.  The NLRA protects employees even if no formal complaint has been made. 

• Discourage "Protected Concerted Activity"

  Employees have the right to work together to improve workplace conditions/problems and management practices. Even casual conversations about wanting higher wages, better scheduling, or safer working conditions are protected by law. 

How to Avoid NLRA Claims 

1.Review Your Policies 

Ensure handbooks, social media guidelines, and confidentiality rules don’t unintentionally restrict employees' rights.  Remove any language that bans discussing wages or workplace issues.  Pay special attention to your social media, confidentiality, and code of conduct policies. Example language to avoid from policies include:

• "Don't discuss your salary."

• "Keep workplace issues internal."

• "Don't criticize the company."

• "Maintain positivity at all times."

• "Don't discuss working conditions."

Instead, use language like:

• "Maintain customer privacy."

• "Protect confidential business information."

• "Follow professional standards."

• "Ensure accurate work time recording."

• "Maintain a respectful workplace."

2. Train Managers on Employee Rights 

Many small business NLRA violations happen because of uninformed managers and even owners.  Train your leadership team on what employees are legally allowed to do under the NLRA to avoid claims. 

3. Encourage Open Communication 

If employees feel heard, they’re less likely to take legal action or seek outside intervention.  Create an internal process for addressing workplace concerns before they escalate.  Remind employees that you have an “open-door” policy and to escalate any concerns using their chain of command, skipping to you or your HR Consultant, like CPR, if they don’t feel comfortable using their chain of command.

4. Think Before Taking Disciplinary Action 

Ask yourself: "Is this related to a protected activity?" before punishing an employee for speaking out or taking any adverse employment action (demotion, salary reduction, job change, etc.). If you’re unsure, consult with CPR before taking action. 

5. Maintain Thorough Documentation

To try preventing an NLRA claim and to prove adverse actions are not in response to protected concerted activity, always maintain:

• Clear policy communications when employees ask about policy details and when distributing and updating policies.

• Employee performance records such as performance reviews and documented discussions about employee performance.

• Documentation on employee disciplinary actions providing a timeline of events.

• Proof of training attendance and policy acknowledgements establishing the fact that the employee was aware of the policy or procedure.

6. Seek HR or Legal Guidance 

If you’re not sure whether your policies or actions comply with the NLRA, get professional help, such as CPR. A small mistake in policy wording or disciplinary action can turn into an expensive legal battle. Take the following immediate steps if you face a claim:

• Don't retaliate.

• Preserve all documents.

• Contact legal counsel.

• Cooperate with the investigation.

When Discipline Is Okay

Abiding by the NLRA does not mean that you can’t address any employee issues. Before addressing, just be ensure it’s not in response to protected activities. You can still address:

• Poor performance

• Policy violations

• Disruptive or unprofessional behavior

• Actual misconduct

• Safety violations

• Violation of trade secrets

Final Thoughts 

The NLRA still applies even if your small business isn’t unionized. Many business owners don’t realize their company policies or disciplinary actions could lead to claims. Don’t wait until a complaint arises—be proactive about compliance! As the saying goes: An ounce of prevention is worth a pound of cure when it comes to NLRA claims. Stay proactive, stay compliant, and keep your business protected.

What's your biggest concern about NLRA compliance? Share in the comments below, and let's discuss solutions that work for your small business.

Disclaimer: The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information.