Fifth Circuit Rules Tesla Dress Code Does Not Violate NLRA
The U.S. Court of Appeals for the Fifth Circuit recently ruled the National Labor Relations Board (NLRB) overstepped its authority in holding that Tesla committed an unfair labor practice by restricting its auto workers from wearing pro-union clothing instead of Tesla-approved uniforms. In vacating the Board’s decision, the Fifth Circuit said the Board irrationally overruled its prior precedent by finding that all company uniform requirements presumptively violated the National Labor Relations Act (NLRA).
When a Tesla automobile reaches the assembly stage, its paint has cured sufficiently for light touching, but Tesla requires its workers to wear company-issued uniforms that reduce the risk of damage to the exterior or the interior of the car during the assembly process. The color of the Tesla uniforms also allows supervisors to distinguish between different teams of assembly workers. Tesla refers to its uniforms as “Team Wear.”
In spring 2017, as part of union organizing efforts, Tesla employees began wearing pro-union United Auto Workers shirts rather than Team Wear. Tesla permitted that for several months. However, after discovering increased damage to cars, Tesla began strictly enforcing its Team Wear policy, although it allowed workers the option to wear pro-union stickers or insignia. The union charged Tesla with unfair labor practices over the Team Wear policy and its enforcement. An administrative law judge subsequently held that Tesla violated Section 8(a)(1) of the NLRA.
In affirming the ruling against Tesla, the NLRB summarized its decision by stating that “when an employer interferes in any way with its employees’ right to display union insignia, the employer must prove special circumstances that justify its interference.” In other words, the Board held that all company uniforms are presumptively unlawful and must pass the special circumstances test.
In setting aside the NLRB decision, the Fifth Circuit held NLRA does not give the NLRB the authority to make all company uniforms presumptively unlawful, and Tesla's Team Wear policy placed no prohibition on union insignia. The court noted that by mischaracterizing Tesla’s legitimate reasons for the Team Wear policy, the NLRB “explicitly demonstrates that it has not weighed Tesla’s interests rationally. Tesla does not ask the NLRB to ignore the employees’ ‘side of the scale’; it merely asks the Board not to ignore the employer’s. The Board has not ‘balanc[ed] the conflicting legitimate interests'—instead, it has elevated employee interests at the expense of legitimate employer interests.”
The Fifth Circuit also relied on its prior rulings that a uniform policy supported an employer’s legitimate non-discriminatory concerns because a “‘uniform requirement fosters discipline, promotes uniformity, encourages esprit de corps, and increases readiness’ and [that] having ‘standardized uniforms encourages the subordination of personal preferences and identities in favor of the overall group mission.’” Likewise, it noted that the “NLRA ‘does not command that labor organizations as a matter of abstract law, under all circumstances, be protected in the use of every possible means of reaching the minds of individual workers, nor that they are entitled to use a medium of communication simply because the employer is using it.’”
The court’s ruling only requires the NLRB to follow its opinion within the Fifth Circuit. However, it provides support for other employers seeking to enforce rational uniform policies in the workplace and potentially sets the stage for review by the U.S. Supreme Court.
Please contact Mark Fijman or any member of Phelps’ Labor and Employment team with questions or for advice and guidance.
