A federal court just rejected the Board’s strictest dress code test
This month, the Federal Appeals Court set aside the legal standard the National Labor Relations Board (NLRB) has used to address workplace dress codes.
The decision doesn’t allow employers to ban union buttons and shirts altogether. Employees still retain a protected right to display union symbols. However, neutral rules on dress and uniforms will no longer face the near-automatic presumption of illegality created by the Board’s 2022 ruling on Tesla.
Starbucks wins at the Second Circuit
On September 2, the U.S. Court of Appeals for the Second Circuit declined to enforce the NLRB’s decision, which had invalidated three of the dress-code rules at the Starbucks’ Reserve Roastery in Manhattan; the case is Siren Retail Corp. d/b/a Starbucks Reserve Roastery v. NLRB.
During its 2022 first-contract campaign, some of the employees wore Starbucks Workers United shirts over their approved aprons. Management ordered them to remove the shirts. The Roastery’s rules permitted one union pin of reasonable size, banned any pins that promoted political, religious or personal issues, and prohibited shirts which had unapproved logos or writing.
The Board regarded all three rules as unlawful under its 2022 Tesla standard, holding that any restriction on union insignia, including one that merely requires a uniform, is unlawful unless the employer proves special circumstances and shows the restriction is no wider than necessary.
The Second Circuit rejected that approach and ruled that the Roastery’s one-pin rule was lawful considering an earlier decision by the same court in the Starbucks case. Even so, employees were able to demonstrate union support, while Starbucks could preserve the image it had built up for its customers.
The court rejected Tesla
The court did not rule Starbucks’ other two policies as being lawful; instead, it returned them to the Board for review using a more balanced standard.
The Board should now assess the extent to which the policy infringes upon Section 7 rights, such as the right to take part in union and other protected concerted activity. It also has to determine whether the policy is neutral and applied in a consistent manner and what the circumstances are that lead to the restriction. A total ban directed at union messages is different from a limited rule which applies to every logo or message.
That method is very similar to the standard set by the Board in 2019 regarding Wal-Mart, a standard which Tesla had rejected. In 2023, the Fifth Circuit dismissed Tesla’s position, and the Second Circuit has now done the same. In her memorandum of August 26, NLRB General Counsel Crystal Carey states that she has already requested the Board to cease applying Tesla in another Starbucks case and to bring back the Wal-Mart standard.
The Board seems to be moving in the direction of bringing back Wal-Mart. It now has a judicial pathway and a General Counsel who is urging it to adopt a more flexible test. That said, Tesla will remain the Board’s established precedent until the Board officially replaces it, and Carey has directed the regional offices to carry on with the current law in the meantime.
What employers should do now
The ruling gives employers greater scope to defend reasonable dress and uniform rules, especially in the Second Circuit.
Limit restrictions to a narrow scope, keep them neutral, and tie them to a legitimate business purpose. Apply them in the same way to both union and non-union messages. Do not impose total bans, and ensure enforcement is not made stricter once organizing has started.
Tesla remains Board precedent for now, so employers should review their policies but wait before making major changes.
