Harbor Freight Tools USA, Inc.

373 NLRB No. 2 NOTICE: This opinion is subject to formal revision before publication in the bound volumes of NLRB decisions. Readers are requested to notify the Executive Secretary, National Labor Relations Board, Washington, D.C. 20570, of any typographical or other formal errors so that corrections can be included in the bound volumes. Harbor Freight Tools USA, Inc. and Daniel Ruiz, Sr., Case No. 28–CA–232596 December 15, 2023 DECISION, ORDER, AND ORDER REMANDING IN PART BY CHAIRMAN MCFERRAN AND MEMBERS PROUTY AND WILCOX On March 12, 2021, Administrative Law Judge Gerald M. Etchingham issued the attached decision in this case, and on April 20, 2021, he issued an errata. The Re- spondent filed exceptions and a supporting brief, the General Counsel filed an answering brief, and the Re- spondent filed a reply brief. The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge’s rulings, findings, and conclusions only to the extent consistent with this Decision, Order, and Order Remanding in Part.1 This case involves complaint allegations that the Re- spondent maintained three work rules in its 2016 hand- book that violate Section 8(a)(1) of the National Labor Relations Act because they interfere with, restrain, and coerce employees in the exercise of the rights guaranteed them by Section 7 of the Act. The challenged rules are entitled “Proprietary and Confidential Information,” “So- cial Media and Networking Guidelines,” and “Solicita- tion and/or Distribution.” As relevant here, applying the framework set forth in Boeing Co., 365 NLRB No. 154 (2017), the judge found that the Respondent violated Section 8(a)(1) by maintaining the “Proprietary and Con- fidential Information” rule in its employee handbook.2 In addition, applying Stoddard-Quirk Mfg. Co., 138 NLRB 615 (1962), and its progeny, the judge further found that 1 We shall amend the judge’s conclusions of law and recommended remedy consistent with our findings herein, and we shall modify the judge’s recommended Order to conform to our findings and the Board’s standard remedial language. We shall substitute a new notice to con- form to the Order as modified. 2 Applying Boeing, the judge dismissed the allegation that the Re- spondent violated Sec. 8(a)(1) by maintaining the handbook rule enti- tled “Social Media and Networking Guidelines.” The General Counsel did not except to the judge’s dismissal of this allegation and, in her answering brief, specifically acknowledged that she was not excepting to the dismissal of the allegation. In the absence of exceptions, we adopt the judge’s dismissal of this allegation. In so doing, we do not pass on the judge’s rationale regarding the lawfulness of the rule under the now-overruled Boeing framework. the “Solicitation and/or Distribution” handbook rule was overbroad in violation of Section 8(a)(1).3 For the reasons set forth below, we adopt the judge’s finding that the portion of the “Solicitation and/or Distri- bution” rule restricting employees’ solicitation activity is unlawfully overbroad in violation of Section 8(a)(1), and we sever and remand the complaint allegation involving the Respondent’s “Proprietary and Confidential Infor- mation” rule to the judge for further consideration con- sistent with the Board’s recent decision in Stericycle, Inc., 372 NLRB 113 (2023), which overruled Boeing, supra. I. “SOLICITATION AND/OR DISTRIBUTION” RULE The Respondent is a nationwide business engaged in the retail sale and rental of tools with an office in Flag- staff, Arizona and headquarters in Calabasas, California, and has two distribution warehouses, a call center, and over 1000 retail stores. The Respondent has a workforce of 20,000 employees, and 16,000 of these employees work at its retail stores. Of these 16,000 employees, ap- proximately 9000 are nonmanagement or nonsupervisory employees. The Respondent’s 2016 handbook was dis- tributed to all of the Respondent’s nonsupervisory em- ployees and applied to such employees at the Respond- ent’s two corporate office buildings, two distribution centers, a call center, and all retail stores. It contained the “Solicitation and/or Distribution” rule at issue here.4 In pertinent part, the rule provides: SOLICITATION AND/OR DISTRIBUTION . . . With respect to employee activity, Harbor Freight Tools prohibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose, including without limitation, for the purposes of financial gain, subscriptions, lotteries, or charities, religious or politi- cal causes, memberships, outside organizations, or oth- er personal matters unrelated to employment with Har- 3 The holding in Boeing did not disturb longstanding precedent gov- erning employer restrictions on solicitation and distribution. See UPMC Presbyterian Shadyside, 366 NLRB No. 142, slip op. at 1, fn. 5 (2018). 4 The 2016 handbook was effective from July 5, 2016, through Jan- uary 20, 2020. Complaint par. 4(b), as amended at the hearing, alleges that “[s]ince at least April 20th, 2019, through about January 20th, 2020, Respondent maintained the following overly broad and discriminatory rules in its [2016] employee handbook[,]” including the 2016 “Solicitation and/or Distribution” rule at issue here. The Respondent issued a revised employee handbook, effective January 20, 2020. The 2020 handbook did not include the version of the “Solicitation and/or Distribution” rule that was in the 2016 employ- ee handbook. The complaint does not allege any violations with re- spect to the 2020 handbook. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 2 bor Freight Tools. Employees may solicit co-workers about causes, interests, political issues, and member- ship during breaks or lunches and other non-working time in non-work areas, so long as employees do not disrupt or interfere with ongoing Harbor Freight Tools operations or harass other employees. . . . . For purposes of this policy only, “work area” is de- fined as any area where actual work is performed for Harbor Freight Tools. Likewise, “non-work area” is defined to include cafeterias, lobbies, parking lots, break rooms, and restrooms, but excludes any areas where customers or clients may congregate or employ- ees perform work for Harbor Freight Tools. “Working time” is defined as periods when employees are per- forming job duties on behalf of Harbor Freight Tools. . . . . The judge found that the 2016 “Solicitation and/or Distribution” rule was unlawfully overbroad because it failed to clarify that the solicitation restriction does not apply to working areas during nonworking time. The judge relied on long-established principles that while an employer may ban solicitation in work areas during working time, an employer may not extend the ban to work areas during nonworking time. See Stoddard- Quirk Mfg. Co, 138 NLRB at 615; see also Republic Avi- ation Corp., 324 U.S. 793, fns. 8 & 10 (1945). Accord- ingly, the judge found that the rule unlawfully prohibits Section 7 activity and, thus, the Respondent’s mainte- nance of that rule in the 2016 handbook, from April 2019 to January 2020, violated Section 8(a)(1).5 On exception, the Respondent asserts that the judge erred in finding the rule unlawful because the rule “does not prohibit solicita- tion activities in non-working areas or on non-working time.” The Respondent additionally contends that the rule is lawful under Board precedent involving solicita- tion prohibitions in the retail setting. For the reasons set forth below, we agree with the judge that the Respond- ent’s prohibition on solicitation set forth in the 2016 “So- licitation and/or Distribution” rule violated Section 8(a)(1). The Board has long held that a no-solicitation rule that prohibits union solicitation on company property only 5 In finding the rule unlawful, the judge also found that the portion of the rule prohibiting distribution violated Sec. 8(a)(1). As the Re- spondent asserts in its exceptions, only the rule’s prohibition on solici- tation is before the Board in this proceeding. In this regard, the rele- vant complaint allegation, the General Counsel’s arguments at the hearing, and her further arguments in her post-hearing brief, focused on the lawfulness of the solicitation prohibition. As a result, we address here only the solicitation portion of the rule and, unlike the judge, we do not pass on the lawfulness of the prohibition on distribution set forth in the 2016 rule. during working time is presumptively lawful in the ab- sence of evidence that it was promulgated for a discrimi- natory purpose, while a no-solicitation rule that prohibits union solicitation on company property during nonwork- ing time is unlawful in the absence of proof that special circumstances make such a rule necessary to maintain production or discipline. See Our Way, Inc., 268 NLRB 394, 394–395 (1983); Peyton Packing Co., 49 NLRB 828, 843–844 (1943), enfd. 142 F.2d 1009 (5th Cir. 1944), cert. denied 323 U.S. 730 (1944); see al- so Republic Aviation, supra, 324 U.S. at 803 & fn. 10 (approving the Board’s standard for no-solicitation rules as set forth in Peyton Packing). Under this precedent, the “Solicitation and/or Distribu- tion” rule at issue here imposes unlawful restrictions on solicitation. The rule prohibits “all solicitation activities in Harbor Freight Tools’ work areas for any purpose[.]” Thus, the solicitation ban is not limited to working areas during working time. See, e.g., UPS Supply Chain Solu- tions, Inc., 357 NLRB 1295, 1296 (2011) (citing Restau- rant Corp. of America v. NLRB, 827 F.2d 799, 806 (D.C. Cir. 1987)). The rule subsequently provides that em- ployees “may solicit coworkers . . . during breaks or lunches and other nonworking time and in non-work are- as.” But this provision, while permitting employees to solicit during nonworking time, limits such solicitation to “non-work areas” in line with the rule’s broad prohibi- tion. Fairly read as a whole, then, the rule improperly bans solicitation in work areas even during nonworking time. See id. at 1296. In the absence of special circum- stances, such a rule is unlawful, and we agree with the judge that the Respondent has failed to meet its burden of proving that special circumstances justify its broad pro- hibition on solicitation in all “Harbor Freight Tools’ work areas[.]” In addition to applying to nonsupervisory employees at the Respondent’s corporate office buildings, two distri- bution centers, and a call center, the solicitation prohibi- tion also applies to the Respondent’s nonsupervisory employees at its retail stores nationwide. As the Re- spondent asserts on exception, in the retail setting, an employer legally may prohibit solicitation by employees on the selling floor even during the nonworking time of the employees. See, e.g., J.C. Penney Co., 266 NLRB 1223, 1224 (1983). The Board has not, however, permit- ted restrictions on solicitation to “be extended beyond that portion of the store which is used for selling purpos- es.” McBride’s of Naylor Road, 229 NLRB 795, 795 (1977); see also Marshall Field & Co., 98 NLRB 88, 92 (1952), modified on other grounds, 200 F.2d 375 (7th Cir. 1952). HARBOR FREIGHT TOOLS, U.S.A., INC. 3 The solicitation prohibition at issue here does not spe- cifically limit the prohibition to the “selling” areas of the Respondent’s retail stores or even provide a definition of “selling” areas. Instead, the rule defines “work areas” to include “any area where actual work is performed for Harbor Freight Tools” and bans solicitation in these work areas. As “actual work” may be performed in areas be- yond the selling floor in the Respondent’s retail stores, such as the stockroom, warehouse and loading areas, and office spaces, the rule is unlawfully overbroad as it per- tains to the Respondent’s retail employees.6 See McBride’s of Naylor Road, supra at 795. The rule fur- ther provides that employees are permitted to solicit in “non-work areas,” which the rule defines as including “cafeterias, lobbies, parking lots, break rooms, and re- strooms, but excludes any areas where customers or cli- ents may congregate or employees perform work for Harbor Freight Tools.”7 To the extent this portion of the rule can be understood to carve out some non-selling areas from the solicitation prohibition, it is nevertheless overbroad because it conveys to retail employees that they may not solicit in “any areas where customers or clients may congregate or employees may perform work.” See, e.g., Chipotle Services, LLC d/b/a Chipotle Mexican Grill, 364 NLRB No. 72, slip op. at 1 fn.3 (2016) (finding unlawful a solicitation prohibition any- where within the visual or hearing range of customers), rev. denied on other grounds 690 Fed. Appx. 277 (5th Cir. 2017). Based on the foregoing, we find, in agree- ment with the judge, that the prohibition on solicitation in the 2016 “Solicitation and/or Distribution” rule vio- lates Section 8(a)(1).8 See, e.g., UPS Supply Chain Solu- tions, Inc., supra, 357 NLRB at 1296. 6 Sallie Taylor, the Respondent’s director of talent development and employee relations, explained that “work areas” in the Respondent’s stores would be located where actual work occurs such as at its “sales floor, the stockroom, the stock area, the warehouse area, the loading dock, the manager’s office, and the cash office.” 7 As to parking lots, Taylor testified that, under the rule at issue, a parking lot can be a work area if an employee is working and collecting shopping carts. The Board, however, has found parking lots not to constitute selling areas. See Sam’s Club, 349 NLRB 1007, 1009 (2007). Taylor also testified that the Respondent holds parking lot sales throughout the year but stated that these sales are generally conducted fully inside the retail stores and not in the parking lots. In addition, at the hearing, Taylor testified that restrooms, for exam- ple, may be transformed into a working area by the mere presence of a customer and that employees would be expected to cease their conver- sations while the customer or client was present in the restroom. The Board has previously rejected similar arguments. See Double Eagle Hotel & Casino, 341 NLRB 112, enfd. 414 F.3d 1249 (10th Cir. 2005). 8 Before the judge, the Respondent asserted that it had repudiated any violation of Sec. 8(a)(1) with respect to the 2016 “Solicitation and/or Distribution” rule because it subsequently issued the 2020 hand- book that did not include this rule and it notified employees that the 2020 handbook “supersedes and replaces all previous” handbooks. II. “PROPRIETARY AND CONFIDENTIAL INFORMATION” RULE As noted above, applying the framework set forth in The Boeing Co., supra, the judge found that the Re- spondent violated Section 8(a)(1) by maintaining the “Proprietary and Confidential Information” rule. Recent- ly, in Stericycle, Inc., supra, the Board overruled The Boeing Co. and adopted a modified version of the framework set forth in Lutheran Heritage Village- Livonia, 343 NLRB 646 (2004). In light of our decision in Stericycle, which implicates the complaint allegations related to the “Proprietary and Confidential Information” rule, we shall sever those allegations and remand them to the judge for further consideration consistent with the framework adopted in Stericycle. AMENDED CONCLUSIONS OF LAW Delete Conclusion of Law 2(a) and renumber Conclu- sion of Law 2(b) accordingly. ORDER The Respondent, Harbor Freight Tools USA, Inc., Cal- abasas, California, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Maintaining an overly broad work rule that prohib- its nonretail employees from engaging in protected solic- itation during nonworking time in working areas and that prohibits retail employees from engaging in protected solicitation in non-selling areas of a retail store, includ- ing any areas where retail employees perform “actual work” and “any areas where customers or clients may congregate or employees may perform work.” (b) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act. Applying precedent based on Passavant Memorial Area Hospital, 237 NLRB 138, 138–139 (1978), the judge found that the Respondent had not effectively repudiated its violation with respect to the maintenance of the 2016 “Solicitation and/or Distribution” rule. On exception, the Respondent offers a cursory challenge to the judge’s finding in this regard and also excepts to the judge’s recommended remedy that the Respondent be required to rescind the 2016 rule. In particular, in its brief in support of its exceptions, the Respondent contends that a rescis- sion remedy is not warranted because it already rescinded the 2016 “Solicitation and/or Distribution” rule and notified employees that it has done so. We agree with the judge that the Respondent has not effectively repudiated its violation with respect to the solicitation pro- hibition in the 2016 “Solicitation and/or Distribution” rule under Passavant but find merit in the Respondent’s assertion that a rescission remedy is not warranted under the circumstances presented here. We thus have not included such a remedy in the Order. See, e.g., Lytton Rancheria of California, 361 NLRB 1350, 1353 fn. 7 (2014). DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 4 (a) Within 14 days after service by the Region, post at its facilities nationwide copies of the attached notice marked “Appendix.”9 Copies of the notice, on forms provided by the Regional Director for Region 28, after being signed by the Respondent’s authorized representa- tive, shall also be posted by the Respondent and main- tained for 60 consecutive days in conspicuous places including all places where notices to employees are cus- tomarily posted. In addition to physical posting of paper notices, notices shall be distributed electronically, such as by email, posting on an intranet or an internet site, and/or other electronic means, if the Respondent custom- arily communicates with its employees by such means. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or cov- ered by any other material. If the Respondent has gone out of business or closed a facility involved in these pro- ceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the notice to all current employ- ees and former employees employed by the Respondent at any time since April 20, 2019. (c) Within 21 days after service by the Region, file with the Regional Director for Region 28 a sworn certifi- cation of a responsible official on a form provided by the Region attesting to the steps that the Respondent has taken to comply. IT IS FURTHER ORDERED that the complaint allegations related to the “Proprietary and Confidential Information” rule are remanded to Administrative Law Judge Gerald M. Etchingham for the purpose of reopening the record, if necessary, and the preparation of a supplemental deci- sion addressing the complaint allegations affected by 9 The Respondent generally excepts to the judge’s recommended remedy but does not specifically except to the judge’s nationwide no- tice-posting remedy. Moreover, in its brief in support of its exceptions, the Respondent does not argue that such a remedy is inappropriate in the circumstances of this case. If a facility involved in these proceedings is open and staffed by a substantial complement of employees, the notice must be posted within 14 days after service by the Region. If a facility involved in these proceedings is closed or not staffed by a substantial complement of employees due to the Coronavirus Disease 2019 (COVID–19) pandem- ic, the notice must be posted within 14 days after the facility reopens and a substantial complement of employees have returned to work. If, while closed or not staffed by a substantial complement of employees due to the pandemic, the Respondent is communicating with its em- ployees by electronic means, the notice must also be posted by such electronic means within 14 days after service by the Region. If the notice to be physically posted was posted electronically more than 60 days before physical posting of the notice, the notice shall state at the bottom that “This notice is the same notice previously [sent or posted] electronically on [date].” If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading “Posted by Order of the National Labor Relations Board” shall read “Posted Pursuant to a Judgment of the United States Court of Appeals Enforc- ing an Order of the National Labor Relations Board.” Stericycle and setting forth credibility resolutions, find- ings of fact, conclusions of law, and a recommended Order. Copies of the supplemental decision shall be served on all parties, after which the provisions of Sec- tion 102.46 of the Board’s Rules and Regulations shall be applicable. IT IS FURTHER ORDERED that the complaint is dismissed insofar as it alleges violations of the Act not specifically found or remanded. Dated, Washington, D.C. December 15, 2023. ______________________________________ Lauren McFerran, Chairman ______________________________________ David M. Prouty, Member ________________________________________ Gwynne A. Wilcox, Member (SEAL) NATIONAL LABOR RELATIONS BOARD APPENDIX NOTICE TOEMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated Federal labor law and has ordered us to post and obey this notice. FEDERAL LAW GIVES YOU THE RIGHT TO Form, join, or assist a union Choose representatives to bargain with us on your behalf Act together with other employees for your bene- fit and protection Choose not to engage in any of these protected activities. WE WILL NOT maintain an overly broad work rule that prohibits nonretail employees from engaging in protected solicitation during nonworking time in working areas and that prohibits retail employees from engaging in protect- ed solicitation in nonselling areas of a retail store, includ- ing any areas where retail employees perform “actual HARBOR FREIGHT TOOLS, U.S.A., INC. 5 work” and “any areas where customers or clients may congregate or employees may perform work.” WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exercise of the rights listed above. HARBOR FREIGHT TOOLS, USA, INC. The Board’s decision can be found at https://www.nlrb.gov/case/28-CA-232596 or by using the QR code below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National La- bor Relations Board, 1015 Half Street, S.E., Washington, D.C. 20570, or by calling (202) 273-1940. Fernando Anzaldua, Esq. and Rodolfo Martinez, Esq., for the Acting General Counsel. Warren J. Higgins, Esq. and Richard S. Zuniga, Esq., for the Respondent. DECISION STATEMENT OF THE CASE GERALD M. ETCHINGHAM, Administrative Law Judge. On December 11, 2018, Daniel Ruiz, Sr. (Charging Party or Ruiz) filed his charge in this Case 28–CA–232596 in Flagstaff, Ari- zona.1 The Counsel for the Acting General Counsel (Acting General Counsel) issued the original complaint against Re- spondent Harbor Freight Tools USA, Inc. (Respondent or Em- ployer) on January 22, 2020 and amended it at hearing with no objection (complaint). (Tr. 11‒12.)2 The Respondent answered the complaint generally denying its critical allegations. The complaint alleges the Respondent violated Section 8(a)(1) of the National Labor Relations Act, as amended (the NLRA or Act) by promulgating and/or maintaining three un- lawful and overly broad rules regarding employee conduct and 1 The charge also contained allegations of the unlawful discharge of Ruiz. That portion of the charge settled and is no longer a part of this case. 2 The transcript in this case is generally accurate but it should be corrected at p. 7, line 12 as “Denise” should be “Vanise”; and at p. 48, line 24 as “customers’” should be “competitors’.” Abbreviations used in this decision are as follows: “Tr.” for transcript; “R Exh.” for Re- spondent’s exhibit; “GC Exh.” for Acting General Counsel’s exhibit; “GC Br.” for the Acting General Counsel’s brief; and “R Br.” for the Respondent’s brief. Although I have included numerous citations to the record to highlight particular testimony or exhibits, my findings and conclusions are based not solely on the evidence specifically cited, but rather on my review and consideration of the entire record. threatening employees with reprisal in Respondent’s associate or employee handbook (the three challenged rules) from July 5, 2016 through at least January 20, 2020 (the 2016 handbook).3 (Tr. 8‒14; GC Exh. 2.) This case was tried in Flagstaff, Arizona on March 10, 2020. On the entire record, including my observation of the demeanor of the witness, and after considering the briefs filed by the Act- ing General Counsel and the Respondent, I make the following FINDINGS OF FACT I. JURISDICTION The parties stipulate and I find that at all material times, Re- spondent, a national corporation with an office and place of business in Flagstaff, Arizona, a corporate headquarters in Cal- abasas, California, warehouses in California and South Caroli- na, and a call center in Camarillo, California (Respondent’s facilities), has been engaged in the retail sale of tools through- out the continental United States. I further find that during the calendar year ending December 11, 2018, Respondent, in con- ducting its business operations derived gross revenues in excess of $500,000. Also, during the same period of time described above, Respondent, in conducting its business operations, pur- chased and received at Respondent’s Flagstaff, Arizona, facili- ty, goods valued in excess of $5000 directly from points outside the State of Arizona. The parties further stipulate, and I find, that at all material times, Respondent has been an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. (GC Exh. 1(c) at 1‒2; and GC Exh. 1(g) at 1.) II. ADDITIONAL GENERAL BACKGROUND Respondent’s director of talent development and employee relations, Sallie Taylor4 (Director Taylor or Taylor), broadly testified that the three challenged rules in this case are neces- sary and Respondent presents a legitimate business justification for each rule in question generally due to its safety, productivi- ty, and privacy concerns as well as protection against harass- ment and false, misleading, or defamatory statements. Respondent operates a tool rental company with two distri- bution warehouses in Moreno Valley, California and Dillon, South Carolina. (Tr. 23; GC Exh. 3.) One distribution center 3 Respondent issued a revised employee handbook online, effective as of January 20, 2020, to its employees which materially revised the Solicitation and/or Distribution Rule but left the Proprietary and Confi- dential Information Rule still defining employees’ personnel files as “confidential.” (Tr. 10‒14, 53‒55; GC Exh. 2; R Exh. 1 at 12, 25-26.) 4 Taylor began work with Respondent in April 2011, and has held various positions of increasing responsibilities as regional human re- sources (HR) manager for Respondent’s Midwest and South Regions until February 2014 or 2015 and senior regional HR manager for Re- spondent’s Western and Southern California Regions from February 2014 or 2015 until August 2017 when Taylor added the title of director of HR store support programs. (Tr. 18‒21.) In February 2019, Taylor became Respondent’s director of talent development and employee relations where she manages the field learning and development team which provides training programs to Respondent’s retail store associ- ates/employees and she also manages the employee relations team which manages Respondent’s corporate employee relations as well as supports field employee relations. (Tr. 20‒21.) DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 6 has approximately 2 million square feet of space to warehouse its tools while the second distribution center is approximately 1 million square feet in size. (Tr. 64‒65.) Each distribution cen- ter is comprised of stacked and racked product, shelves, pallets, conveyor lines, and loading and unloading areas. (Tr. 65.) Each distribution center also has some office space within. Id. In addition, Respondent has over a thousand retail tool rental stores in the continental United States selling primarily to a range of customers from a semi-professional welder or electri- cian or general contractor to a do-it-yourselfer or the general public. (Tr. 19, 23‒24, 63.) There are 8‒12 stores per district which are managed by a district manager and approximately a hundred stores per region which are managed by Respondent’s regional managers. Id. Employees at these retail stores also perform work outside the store, including collecting carts in parking lots, conducting sales up to six times a year in parking lots, unloading trucks in the loading docks, and advertising and selling products on the sidewalks in front of the store. (Tr. 63‒64, and 77.) Respondent has approximately 20,000 employees in total with approximately 16,000 of these employees working in over one thousand Respondent retail tool stores across the country. (Tr. 24, 58, 63; GC Exh. 3.) Of the 16,000 employees, approx- imately 9000 are non-management or nonsupervisory employ- ees. Id. Respondent’s corporate headquarters is in Calabasas, Cali- fornia, and it has one thousand employees working there in two 2-story buildings. (Tr. 23, 65‒66.) Respondent has its direc- tors, managers, vice presidents, coordinators, analysts, assis- tants, and specialists working there. (Tr. 66.) Respondent also operates an asset recovery center and cus- tomer service call center in nearby Camarillo, California, with approximately 30 employees. (Tr. 23, 66, 78.) As stated above, the Respondent’s 2016 handbook was in place on July 5, 2016 and maintained through January 20, 2020. (Tr. 8‒11, 25, 53‒55; GC Exh. 2; R Exh. 1.) The 2016 hand- book was distributed to all of Respondent’s nonsupervisory employees and became effective on July 5, 2016 at Respond- ent’s two corporate offices buildings, all retail stores, its two distribution centers and its call center and Respondent expects all employees to fully comply with all rules in its handbook. (Tr. 25, 57‒58.) Respondent’s revised handbook as of January 20, 2020 is currently in place and is not challenged in this case (the 2020 Handbook). (Tr. 8‒11, 25, 53‒55; GC Exh. 2; R Exh. 1.) III. RESPONDENT’S 2016 HANDBOOK Taylor admits that an employee can be disciplined and/or terminated for failing to comply with any rule in Respondent’s handbook. (Tr. 58‒59.) Taylor knows that the 2016 handbook was created by Re- spondent’s senior manager of HR in Respondent’s corporate office, Felicia Ruiz (Ruiz), along with Respondent’s Associate General Counsel Tammy Stafford (Stafford), and Respondent’s General Counsel Mark Friedman (Friedman). (Tr. 25‒26.) Between July of 2016 and February of 2019, Taylor was re- sponsible for answering questions, advising associates, any- body in the stores with regard to items that pertained to the 2016 handbook within her region or regions. (Tr. 22, 25, 53‒55; GC Exh. 2.) In addition, Taylor was responsible for the rollout of the 2016 handbook and just ensuring that the exist- ence of the new 2016 handbook was communicated to employ- ees who may have had questions. Id. Taylor also maintains a role in her current position with the employee disciplinary process as she provides advice on how Respondent has handled things in the past to ensure consisten- cy, and she works to ensure that Respondent is being consistent with the application or enforcement of its discipline. (Tr. 22.) Generally, Taylor consulted the 2016 handbook to review the specific language and to ensure consistency if there is a concern about something related to the 2016 handbook from an employ- ee relations perspective. (Tr. 26.) In addition, Taylor opined that to determine whether an employee’s conduct violated a rule or policy in the 2016 handbook, Taylor would typically look at the code of conduct section of the 2016 handbook, con- sult with Respondent’s legal team, and look specifically at the specific language of the rule in question. (Tr. 26‒27, 53‒55; GC Exh. 2 at HFT 091‒093.) In addition, up through February 2019, Taylor was notified whenever a Respondent employee has violated any of Re- spondent’s rules or policies that were set forth in the 2016 handbook either by email or through Respondent’s case man- agement system, or from following up on an anonymous tip line and 800 phone number that Respondent maintains for em- ployee concerns. (Tr. 27.) Also, from 2014 through February 2019, as regional manager or senior regional manager, Taylor was responsible for everything concerning employee discipline that occurred in her regions and also, as a senior member of the field HR team, Taylor was often called on to consult on things that happened in other regions, or she was notified of things happening in other regions to provide feedback information about how Respondent has handled things in the past and how to understand how Respondent reads and views and enforces its policies and rules. (Tr. 28, 81.) As of March 2020, however, Taylor is notified only about unusual disciplinary matters because she says that “items that are related to, like, attendance or cash violations would not get bubbled up to me [Taylor] unless it was to say that there is a clarity concern with regard to the policy or something of that nature.” (Tr. 27‒28, 76.) Taylor explained further that “items that we do not run across frequently would be bubbled up to me to ensure consistency, so that I could investigate their—look at, you know, how it was investigated, look at all of the particular issues or particular information and ensure that we are being consistent and understanding things accurately.” Id. IV. THE THREE CHALLENGED RULES The Acting General Counsel alleges that since April 20, 2019, through January 20, 2020, the Respondent has main- tained the following three challenged rules in its handbook. A. The First Challenged Rule PROPRIETARY AND CONFIDENTIAL INFORMATION Employees may have access to Proprietary and Confidential information during the course of employment with Harbor Freight Tools. Each Employee shall ensure that Proprietary HARBOR FREIGHT TOOLS, U.S.A., INC. 7 and Confidential Information is used only for valid company purposes. Employees are prohibited from disclosing Proprie- tary, Confidential, or other information about the operations of Harbor Freight Tools to third parties except as directed in writing by an authorized representative or officer of Harbor Freight Tools. […] Confidential Information includes, but is not limited to, in- formation from employee personnel files; financial infor- mation about [Respondent; Respondent’s] policies, proce- dures, and training materials; product testing information and analysis, and information from and about [Respondent’s] cus- tomers, including all personally identifiable information […]. This policy shall include events and circumstances that in- volve Harbor Freight Tools, its customers, or its employees. […] (Tr. 12; GC Exh. 1(c); GC Exh. 1(g); and GC Exh. 2 at 17‒18.) Taylor opined that she learned of this first challenged rule by her being present when questions about the policy came up through the course of discussion with Respondent’s in-house General Counsel Friedman, Associate General Counsel Staf- ford, and Senior Manager of HR Ruiz. Taylor understands that Respondent’s proprietary and confidentiality policy was created by Respondent to protect Respondent and its associate employ- ees, and customers against the unauthorized disclosure of pro- prietary and confidential information. (TR. 25‒26, 30‒31, 74.) Taylor also has knowledge regarding the purpose of this rule and how it is implemented and understood from her earlier work as the director of employee relations, conversations that she has had with different members of the legal team, other management and employees including her immediate boss, and situations that she has had with others. (Tr. 74‒75.) Taylor further opined that Respondent’s HR team maintains and stores an employee’s official full personnel file electroni- cally and, among other things, it contains the employee’s home address, work progress, reviews, and wage and benefits infor- mation and other contact information. (Tr. 31‒32, 35.) Taylor also explained that in addition to an employee’s full electronic personnel file, there is also one hard-copy personnel file for each employee at the store, distribution center, or wher- ever they actually work with original documents that include all disciplinary forms that they may have received and signed off on, and also includes their work progress reviews and infor- mation regarding anything that they disclose in their I-9, so their citizenship status and all of the associate’s personal infor- mation, home addresses, and wage and benefits information, employment offer letters, other contact information, and any- thing else relevant. (Tr. 32, 35.) Taylor further opined that it is also Respondent’s policy that employees requesting a copy of their full personnel file must do so in writing and once the written request is received, Respond- ent provides copies of personnel files to employees in compli- ance with their state law. (Tr. 31-33, 78‒79.) Taylor also explained that all employees have access to a portion of their personnel documents such as those they receive from any disciplinary documentation and they have access to their work progress reviews and their wage and benefit pay information through Respondent’s former electronic HRIS system.5 (Tr. 33‒34.) Employees acknowledge receipt of Re- spondent’s employee handbook online using the HRIS system. (Tr. 57.) Taylor was asked which employees have access to other em- ployee’s personnel files not their own and she explained that access to other employee personnel files is limited to HR man- agement employees, assistant managers and store managers at their stores, and other field HR managers would have access to personnel files when they visit stores. (Tr. 34.) Taylor further admitted that employee personnel files are in- cluded in the definition of Respondent’s proprietary and confi- dential information rule because Respondent’s property in- cludes its employees’ personnel files and employees “have a responsibility to protect the personal and private information of [Respondent’s] associates [employees].” (Tr. 34‒35, 59.) Next, Taylor denied that the confidentiality rule was ever in- tended by Respondent to prevent an employee from disclosing or sharing information that they have obtained or might be included in their own personnel file and Taylor was unaware of any employee who had been disciplined under the proprietary and confidential information policy for disclosing or sharing information that they have obtained from another employee’s personnel file or which might be included in their own person- nel files. (Tr. 35.) Taylor also admits that this rule defines confidential infor- mation to include information from employee personnel files. (Tr. 59.) Despite the apparent contrary language in the confi- dentiality rule, however, Taylor further opines that once they have requested their personnel file in writing and received it from Respondent, employees are allowed by Respondent to share documents from their personnel files to outside organiza- tions and other employees without discipline or termination.6 (Tr. 61, 79.) Moreover, Taylor also denies that Respondent’s confidential- ity rule prohibits its employees from disclosing information about any events and circumstances involving the Respondent or its employees even though the rule specifically states that: “This [confidentiality] policy shall include events and circum- stances that include [Respondent] Harbor Freight Tools, its customers, or its employees.” (Tr. 62; GC Exh. 1(c); GC Exh. 1(g); and GC Exh. 2 at 17‒18.) Taylor further denies that the confidentiality rule would pro- hibit an employee from publicizing a union-organizing drive or a union election at one of Respondent’s retail stores or distribu- tion centers. (Tr. 62.) Taylor also explains that despite the specific wording of the confidentiality rule, an employee is not prohibited from sharing to anyone, outside of Respondent or with a fellow employee, anything that occurs to them as an employee at Respondent’s retail stores or distribution centers 5 In January 2020, Respondent switched to a new My HFT system which is an HR information system and in this current My HFT system, employees can take e-learnings (trainings), they can see their pay in- formation and pay statements, they can enter their e-signature for any documents that need acknowledgment such as Respondent’s handbooks and employees can access their performance reviews. (Tr. 56.) 6 Retail employees usually do not have access to other employees’ personnel files—only their own. (Tr. 61.) DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 8 including sharing with another employee or outside group any information concerning an event and circumstance from work- place accidents. Id. Taylor also admitted that Respondent did not inform its em- ployees about these specific alleged exceptions to the prohibi- tions of the confidentiality rule for disclosing information about events or circumstances related to working conditions of em- ployment or from disclosing information about union organiz- ing to third parties outside of Respondent. (Tr. 63.) Taylor was also unaware of any employee who has had a question about whether they are permitted to disclose or share information from their own personnel files based on this policy and Taylor further denied that anyone at Respondent ever sug- gested to her that the purpose of this policy is that it is intended to prevent employees from disclosing or sharing information from their own personnel files. (Tr. 63.) Taylor also opined that this policy was not intended to pre- vent employees from disclosing or sharing information about their own wages, hours, or working conditions, she has not learned from any source that an employee has had a question about whether this policy prevents them from disclosing or sharing information about their wages, hours, or working con- ditions, and Taylor further denied knowing of any Respondent employee who has been disciplined under this policy for dis- closing information about their wages, hours, or working condi- tions. (Tr. 35‒36.) Finally, Taylor denied that the proprietary and confidentiali- ty policy was adopted in response to any union or union-related activity, she also denied knowing whether any employee ever asked Respondent officials whether the policy applies to unions or union-related activity, and Taylor also denied that any Re- spondent employee has ever been disciplined under this policy for engaging in any kind of union-related activity.7 (Tr. 36‒37.) B. The Second Challenged Rule SOCIAL MEDIA AND NETWORKING GUIDELINES 3. Testimonials and Endorsements  Do not make any claims about Harbor Freight Tools […] that are not substantiated (i.e., for which you do not have adequate proof to back up the claim).  Do not make any factually inaccurate statements, particularly statements that may be disparaging […], regarding Harbor Freight Tools’ competitors or their services, or Harbor Freight Tools’ employees, officers, suppliers, or partners. (GC Exh. 1(c); GC Exh. 1(g); and GC Exh. 2 at 31‒37.) Taylor learned of Respondent’s business reasons for its so- cial media and networking guidelines policy also from speaking to Associate General Counsel Stafford from Respondent’s legal department who Taylor understands drafted this policy with Ruiz and Friedman. (Tr. 47, 74.) Taylor explains that this 7 These denials by Taylor are the same for each of the three chal- lenged rules as discussed below. See Tr. 45-46, 50‒53. second challenged rule is intended by Respondent to protect Respondent’s customers, competitors, Respondent, and its em- ployees, officers,8 suppliers, or partners “against false, mislead- ing, or defamatory statements, as well as harassment.” (Tr. 47‒48, 74.) Taylor also has knowledge regarding the purpose of this rule and how it is implemented and understood by em- ployees from her earlier work as the director of employee rela- tions, conversations that she has had with different members of the legal team, other management and employees including her immediate boss, and situations that she has had with others. (Tr. 74‒75.) Taylor further opined that the rule is intended to ensure that if an employee posts something on social media, that they are posting their own opinion, and that it is clear they are posting their own opinion and not the opinion on behalf of the Re- spondent or as Respondent’s agent. (Tr. 48.) Taylor also explained that “testimonials and endorsements” are within the social media and networking policy as she under- stands it as these mean testimonials and endorsements about Respondent’s products, any comparison to Respondent’s prod- ucts and Respondent’s competitors’ products. Taylor further explained that Respondent has concerns about “testimonials and endorsements” on social media because this is regulated by the Federal Trade Commission (FTC) and there are legalities related to testimonials and endorsements, and it is important for Respondent to clarify what those requirements or guidelines are for Respondent’s employees. (Tr. 48‒49.) Taylor was further directed to opine about another part of Respondent’s social media and networking guidelines policy— the rule at page 36 of the handbook advising employees: “Do not make any claims about [Respondent] Harbor Freight Tools or its services or Harbor Freight Tools’ competitors or their services that are not substantiated, i.e., for which you do not have adequate proof to back up the claim.” (Tr. 49; GC 2 at 36.) Taylor opined that her understanding of this part of Re- spondent’s second challenged rule is that it is intended to ad- dress: instances in which comments or testimonials and endorse- ments may be made about our products, our competitor’s products that may make claims about our products that are in- accurate in an attempt to make our product, you know, sound better in comparison to the competitor’s product, protect against, you know, any false or misleading statements about our competitor’s product in an attempt to make our product look better in comparison. (Tr. 49.) Taylor further explained that her understanding is that the FTC further requires that all testimonials or endorsements must be true. (Tr. 49‒50, 77.) Taylor admits, however, that she has no experience resolving any issues with FTC regulations or this social media rule as Respondent has never had a situation arise 8 Taylor understands that “officers” included in this rule means Re- spondent’s chief financial officer and other executives at Respondent such as its president and executive vice president and owner as Re- spondent did not have a chief executive officer at the time of hearing. (Tr. 75.) HARBOR FREIGHT TOOLS, U.S.A., INC. 9 relating to a testimonial or an endorsement. (Tr. 77.) Next, Taylor opines that the same explanation exists for why Respondent also has the additional rule: “Do not make any factually inaccurate statements, particularly statements that may be disparaging or defamatory regarding Harbor Freight Tools, Harbor Freight Tools’ competitors, or Harbor Freight Tools’ employees, officers, suppliers, or partners.” (Tr. 50.) Taylor explains that this additional rule is intended to address the same concern that all testimonials and endorsements must be true. (Tr. 50.) Taylor also denied having any knowledge that any employee has had a question about whether the social media and network- ing guidelines policy would prevent them from disclosing or sharing information about their wages, hours, or working con- ditions or that Respondent’s solicitation and/or distribution policy was intended to prevent employees from disclosing or sharing information about their wages, hours, or working con- ditions. (Tr. 50‒51.) Moreover, Taylor further denied having any knowledge of any Respondent employee being disciplined under this policy for disclosing information about their wages, hours, or working conditions. Id. No evidence was presented that showed that Respondent’s social media and networking guidelines policy was adopted in response to any union or union-related activity, she also denied knowing whether any employee ever asked Respondent offi- cials whether the policy applies to unions or union-related ac- tivity or that any Respondent employee has ever been disci- plined under this policy for engaging in any kind of union- related activity. (Tr. 50‒51.) Moreover, Taylor also denied that the social media policy was intended to prevent employees from criticizing Respondent. (Tr. 51‒52.) Taylor next opined about language on page 32, item 13, of the Employee Handbook which is under a “Standards of Con- duct and Corrective Action” heading on the prior page and warns against: “Making or publishing false or malicious state- ments concerning any employee, supervisor, manager, [Re- spondent] Harbor Freight Tools, its products, work or reputa- tion.” Taylor explained that this rule means that an employee “should not make statements concerning an employee, a super- visor, a manager, the [Respondent] Company, our products, work or our reputation that is false or malicious.” (Tr. 52.) Taylor further opined that the Respondent’s business purpose for this rule is to “protect against defamation, harassment, [and] false statements.” Id. Taylor also explained that there is further limiting language for this rule that provides that: “This policy will not be applied in a way that interferes with employees’ rights to communicate with each other about work-related issues.” (Tr. 52‒53.) Tay- lor further explained that this limitation means “that associates [employees] are allowed to communicate with each other about items related to their employment, including their pay, their work condition, items of that nature.” (Tr. 53.) C. The Third Challenged Rule SOLICITATION AND/OR DISTRIBUTION […] With respect to employee activity, Harbor Freight Tools pro- hibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose, including without limitation, for the purpose of financial gain, subscriptions, lotteries, or charities, religious or political causes, memberships, outside organiza- tions, or other personal matters unrelated to employment with Harbor Freight Tools. Employees may solicit co-workers about causes, interests, political issues, and membership dur- ing breaks or lunches and other non-working time in non- work areas, so long as employees do not disrupt or interfere with ongoing Harbor Freight Tools’ operations or harass other employees. […] For purposes of this policy only, “work area” is defined as any area where actual work is performed for Harbor Freight Tools. Likewise, “non-work area” is defined to include cafe- terias, lobbies, parking lots, break rooms, and restrooms, but excludes any areas where customers or clients may congre- gate or employees perform work for Harbor Freight Tools. “Working time” is defined as periods when employees are performing job duties on behalf of Harbor Freight Tools. […] (GC Exh. 1(c); GC Exh. 1(g); and GC Exh. 2 at 18, 24, 31‒37.) (Emphasis in original.) Taylor opined that she also acquired an understanding of Re- spondent’s rationale for the solicitation and/or distribution rule from speaking to Associate General Counsel Stafford who Tay- lor understands drafted this policy. (Tr. 37‒38, 74.) Taylor has spoken to Stafford about Respondent’s business reason for this policy which is “to protect against disturbances, interruptions, distractions that may affect productivity and safety [at Re- spondent].” (Tr. 38‒39, 74.) Taylor also has knowledge re- garding the purpose of this rule and how it is implemented and understood by employees from her earlier work as the director of employee relations, conversations that she has had with dif- ferent members of the legal team, other management and em- ployees including her immediate boss, and situations that she has had with others. (Tr. 74‒75.) Taylor further opines that the impact to Respondent if em- ployees are distracted while working is that they or Respond- ent’s customers can suffer from accidents and/or injuries as Respondent has many stores and distribution centers which have stockrooms that have forklifts and have a lot of work ac- tivity with regard to different machinery and forklifts and things like that happening, things of that nature. (Tr. 40.) Taylor further explained that specifically as to Respondent’s two distribution centers, there are safety concerns because Re- spondent has 2 million square feet of product that can be stacked high, and Respondent also has different machines being used to gather that product and load trucks. (Tr. 40‒41.) Tay- lor further opines that Respondent sends out hundreds of full trucks a week with product in it, and “there’s a lot of different, kind of very organized activity happening in any one moment in terms of people pulling product, people filling the trucks, and somebody that is being distracted and is not focused on the machine that they are operating or the machine that somebody else is operating, you know, there is always a safety concern there.” (Tr. 41.) Taylor further explained that specifically as to Respondent’s thousands of retail stores, there are also safety concerns that Respondent’s solicitation and/or distribution policy is intended DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 10 to address because Respondent has stockrooms in its stores and Respondent has a lot of product in its stores that is stacked up, and Respondent’s associate employees are responsible at any given time for pulling product and filling the sales floor and there’s a forklift that might be loading a customer’s car with a product or moving heavier items in the stockroom. Anything over 50 pounds would require a team, so Respondent may have two people that are potentially moving a product together at one time. (Tr. 41‒42.) Taylor further explained that various solicitation activities referenced in Respondent’s policy that implicate safety are directly connected to somebody talking to an employee at work about something unrelated to the job when an employee could get distracted and are unable to focus on doing the job and do- ing the job safely. (Tr. 42.) Taylor also opined that Respond- ent’s solicitation and/or distribution policy is intended to pro- tect an employee’s productivity at work because if somebody is speaking to an employee about something unrelated to the job, then the employee is distracted from the work that he or she is doing, potentially unable to support a customer, the employee is delayed in completing whatever task that they are doing, and all this impacts Respondent’s productivity and its labor standard. (Tr. 42.) Taylor estimates that Respondent conducts approximately six parking lot sales per year at its retail stores in actual parking lots or outside sidewalks of the store. (Tr. 64.) Of these six parking lot sales, many stores conduct the sale fully inside the retail store and not outside in a parking lot. Id. Taylor opines that a parking lot can be a work area if an employee is working on the clock and they are collecting shopping carts.9 (Tr. 80.) Taylor understands that Respondent’s solicitation policy prohibits all solicitation activities in Respondent’s work areas for any purposes. (Tr. 66‒67.) Taylor further admits that Re- spondent’s solicitation rule prohibits all solicitation for outside organizations in all of Respondent’s work areas during working time and this includes prohibiting solicitation in support of a union if done in any work area during working time. (Tr. 67.) Taylor pointed out that the solicitation and/or distribution rule does not apply on nonworking time and in the break room at Respondent’s retail stores, the parking lot, or the restrooms.10 (Tr. 42‒44.) Taylor further opined that “work areas” in Re- spondent’s stores would be located where actual work occurs such as at its “sales floor, the stockroom, the stock area, the warehouse area, the loading dock, the manager’s office, and the cash office” while, generally, the “nonwork areas” are at Re- spondent’s cafeterias, lobbies, parking lots, break rooms, and 9 Taylor further explains that if there is no work being performed in a parking lot and there is no outside parking lot sale, the parking lot would not be considered a work area if the outside employee was also not doing work while on the clock. (Tr. 80.) 10 Taylor explains that Respondent’s restrooms in its retail stores are open to the public and employees and Taylor opines that the mere presence of a customer or client in a restroom would transform that restroom into a working area and if two employees are discussing busi- ness information in the restroom when a customer or client enters, Respondent would expect them to stop speaking about business infor- mation while the customer or client are in the restroom. (Tr. 77, 79‒80.) restrooms.11 (Tr. 43, 70‒71.) Taylor explains that the solicitation and/or distribution rule applies at Respondent’s headquarters in work areas which she describes as areas where actual work is performed such as in individual offices largely inhabited by Respondent’s corporate management and salaried employees. (Tr. 71‒72.) Taylor again clarified that there is an exclusion from “non- work areas” in the rule for “any areas where customers or cli- ents may congregate or employees perform work for [Respond- ent] Harbor Freight Tools” and she further opined that is most likely to be areas primarily on the sales floors, but that stock- rooms, manager offices, cash offices, and loading docks, while not the usual place to find customers or clients, these are also places where infrequently customers or clients may congregate and employees perform work. (Tr. 44‒45.) Taylor also denied having any knowledge that any employee has had a question about whether the solicitation and/or distri- bution policy would prevent them from disclosing or sharing information about their wages, hours, or working conditions or that Respondent’s solicitation and/or distribution policy was intended to prevent employees from disclosing or sharing in- formation about their wages, hours, or working conditions. (Tr. 45.) Moreover, Taylor further denied having any knowledge of any Respondent employee being disciplined under this policy for disclosing information about their wages, hours, or working conditions. (Tr. 45‒46.) Finally, Taylor was unaware whether Respondent’s solicita- tion and/or distribution policy was adopted in response to any union or union-related activity, she also denied knowing whether any employee ever asked Respondent officials whether the policy applies to unions or union-related activity, and Tay- lor also denied that any Respondent employee has ever been disciplined under this policy for engaging in any kind of union- related activity. (Tr. 45‒46.) ANALYSIS I. CREDIBILITY A credibility determination may rely on a variety of factors, including the context of the witness’ testimony, the witness’ demeanor, the weight of the respective evidence, established or admitted facts, inherent probabilities and reasonable inferences that may be drawn from the record as a whole. Double D Con- struction Group, 339 NLRB 303, 305 (2003); Daikichi Sushi, 335 NLRB 622, 623 (2001) (citing Shen Automotive Dealership Group, 321 NLRB 586, 589 (1996)), enfd. 56 Fed. Appx. 516 (D.C. Cir. 2003). Credibility findings need not be all-or- nothing propositions—indeed, nothing is more common in all kinds of judicial decisions than to believe some, but not all, of a witness’ testimony. Daikichi Sushi, 335 NLRB at 622. I find that the lone witness who testified in this case for Re- 11 Taylor explained that not all of Respondent’s facilities have these nonwork areas and that it depends on the actual location. Respondent’s retail stores typically do not have a cafeteria or a lobby. Its corporate office typically has all of the above, as do its two distribution centers. (Tr. 43‒44.) Taylor has no experience working directly at Respond- ent’s distribution centers or at its Camarillo call center, so Taylor had no opinion how Respondent’s solicitation and/or distribution rule is applied at those locations. (Tr. 71‒72.) HARBOR FREIGHT TOOLS, U.S.A., INC. 11 spondent, Director Taylor, was believable at times and that she testified in a comfortable manner bringing many past experi- ences from her prior work at several regional positions with Respondent to the hearing. Taylor was not being truthful, though, when she disregarded the plain language of Respond- ent’s confidentiality rule and she opined that once an employee has requested their personnel file in writing and received it from Respondent, employees are allowed by Respondent to share all documents from their personnel files including their wage and benefits information with other employees and out- side organizations without discipline or termination despite the confidentiality rule’s specific prohibition that employees not disclose information from an employee’s personnel file to third parties including other employees or outside organizations. (Tr. 61, 79.) Moreover, Taylor was not believable when she denied that Respondent’s confidentiality rule prohibits its employees from disclosing information about any events and circumstances involving the Respondent even though the rule specifically states that: “This [confidentiality] policy shall include events and circumstances that include [Respondent] Harbor Freight Tools, its customers, or its employees.” (Tr. 62; GC Exh. 1(c); GC Exh. 1(g); and GC Exh. 2 at 17‒18.) (Emphasis added.) Taylor also appeared ill-at-ease when she tried to explain that under the confidentiality rule, an employee is not prohibit- ed from sharing with anyone, outside of Respondent or with a fellow employee, anything that occurs to them as an employee at Respondent’s retail stores or distribution centers including any workplace accidents despite the plain language in the rule prohibiting employees from disclosing information about all events and circumstances that involve all of Respondent’s em- ployees. (Tr. 62; GC Exh. 2 at 17‒18.) Finally, I find that Taylor was also not being truthful when she opined that Re- spondent’s confidentiality rule was not intended to prevent employees from disclosing or sharing information about their own wages, hours, or working conditions. (Tr. 35‒36.) With respect to the other two challenged rules here, Taylor was upfront and believable as she testified that she learned of the business rationale for the rules from Respondent’s legal department team and her understanding as to Respondent’s legitimate justifications for creating these rules combined with her experience in HR as one of the Respondent’s most senior managers who advises others on discipline for an alleged rule violation and she is also very experienced having received in- formation on most discipline of employees at Respondent, I find Taylor’s limited understanding of Respondent’s legitimate business justifications persuasive to the extent she had knowledge.12 II. THE CURRENT BOEING RULES TEST 12 The Acting General Counsel’s first reference to Federal Rule of Evidence Rule 801 in his closing brief to object to Taylor’s testimony here is untimely and does not repair the lack of objection to Taylor’s testimony at the hearing. See GC Br. at 3, fn 4, and Alvin J. Bart & Co., 236 NLRB 242, 243 (1978), enforcement denied on other grounds, 598 F.2d 1267 (2d Cir. 1979) (Board found questionable hearsay testi- mony admissible because the respondent did not object to the testimony at the hearing.). Under Boeing [Co., 365 NLRB No. 154 (2017)], … the Board first determines whether a challenged rule or policy, reasona- bly interpreted, would potentially interfere with the exercise of rights under Sec. 7 of the Act. If not, the rule or policy is lawful and placed in Category 1(a). If so, the Board deter- mines whether an employer violates Sec. 8(a)(1) of the Act by maintaining the rule or policy by balancing “the nature and extent of the potential impact on NLRA rights” against “legit- imate justifications associated with the rule,” viewing the rule or policy from the employees’ perspective. Id., slip op. at 3. As a result of this balancing, the Board places a challenged rule into one of three categories. Category 1(b) consists of rules that are lawful to maintain because, although the rule, reasonably interpreted, potentially interferes with the exercise of Sec. 7 rights, the interference is outweighed by legitimate employer interests. Category 3, in contrast, consists of rules that are unlawful to maintain because their potential to … in- terfere with the exercise of Sec. 7 rights outweighs the legiti- mate interests they serve. Categories 1(a), 1(b), and 3 desig- nate types of rules; once a rule is placed in one of these cate- gories, rules of the same type are categorized accordingly without further case-by-case balancing (for Category 1(b) and 3 rules; balancing is never required for rules in Category 1(a)). Some rules, however, resist designation as either always law- ful or always unlawful and instead require case-by-case anal- ysis under Boeing’s balancing framework. These rules are placed in Category 2. Windsor Sacramento Estates, LLC d/b/a Windsor Care Center of Sacramento, 369 NLRB No. 146, slip op. at 3, fn.3 (2020). III. THE THREE CHALLENGED RULES A. Respondent’s Proprietary and Confidential Information Rule Is Unlawful under Section 8(a)(1). (Complaint Pars. 4(a), and 5(a) and 5.) Paragraph 4(a) of the Acting General Counsel’s complaint alleges that from April 20, 2019, through January 20, 2020, Respondent has maintained the following unlawful rule in the 2016 Handbook: (a) PROPRIETARY AND CONFIDENTIAL INFO. Employees may have access to Proprietary and Confidential information during the course of employment with Harbor Freight Tools. Each Employee shall ensure that Proprietary and Confidential Information is used only for valid company purposes. Employees are prohibited from disclosing Proprie- tary, Confidential, or other information about the operations of Harbor Freight Tools to third parties except as directed in writing by an authorized representative or officer of Harbor Freight Tools. […] Confidential Information includes, but is not limited to, in- formation from employee personnel files; financial infor- mation about [Respondent; Respondent’s] policies, proce- dures, and training materials; product testing information and analysis, and information from and about [Respondent’s] cus- tomers, including all personally identifiable information […]. This policy shall include events and circumstances that in- volve Harbor Freight Tools, its customers, or its employees. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 12 […] The Acting General Counsel argues that this confidentiality rule is unlawful because it prohibits employees from disclosing personal employee information, including information from employee personnel files and absent additional context, em- ployees would reasonably read personnel files to include con- tact information and other information concerning wages, bene- fits, disciplinary actions, and other terms and conditions of employment they are lawfully permitted to discuss with the Union or each other. The Acting General Counsel further ar- gues that the Respondent did not present any credible evidence that its employees can share or have shared personnel file in- formation and, Taylor even admitted that employees would be expected to stop talking about all business information con- tained in their personnel files while a customer is in the re- stroom with them. Tr. 14, 79; GC Br. at 4, and 10‒12. The Acting General Counsel also argues that: “[a]bsent any additional context, employees would reasonably read “person- nel files” to include contact and other information concerning wages, benefits, disciplinary actions, and other terms and con- ditions they are permitted to discuss with a union or each other, and Respondent has failed to identify a legitimate business reason for the rule or impinging on this aspect of employee Section 7 rights . . . [and paragraph 6 of the confidentiality rule involving events or circumstances involving the Employer’s employees] thus prohibits disclosure of information about events or circumstances involving the Employer’s employees . . . [and c]onsequently, paragraph 6 encompasses, and in turn prohibits, the disclosure of information about events or circum- stances involving the Employer’s employees.” ( GC Br. at 10‒11.) The Acting General Counsel adds that “insofar as paragraph [5 of the confidentiality rule], which defines ‘Confi- dential Information’ to include ‘information from employee personnel files’, such information would include employees’ wage rates and/or salaries, disciplines, and other items that employees are permitted to discuss concertedly under Section 7. (GC Br. at 11.) The Acting General Counsel concludes arguing that: “[w]hile protecting proprietary information is a legitimate busi- ness justification, the [confidentiality] rule is overly broad be- cause, as admitted by Respondent, it sweeps in confidential information which it defines to include terms and conditions of employment, including events or circumstances relating to their working conditions, that employees have a right to discuss with third parties . . . [and n]otably, Respondent never communicat- ed to its employees that its confidentiality rule does not prohibit them from disclosing events or circumstances relating to their working conditions or employment or that it does not prohibit them from disclosing information about events or circumstanc- es relating to union organizing.” (GC Br. at 11.) Taylor admitted that employee personnel files are included in the definition of Respondent’s proprietary and confidential information rule because Respondent’s property includes its employees’ personnel files and employees “have a responsibil- ity to protect the personal and private information of [Respond- ent’s] associates [employees].” (Tr. 34‒35, 59.) As stated above, and contrary to the specific prohibiting language in the confidentiality rule, Taylor unconvincingly denies that employ- ees are prohibited under the rule from sharing with other em- ployees or outside entities information contained in their per- sonnel files or information about some events and circumstanc- es that occurred while they were employed at Respondent, in- cluding information about wages and other pay information. (Tr. 35‒36, 59, 61‒62, 79; GC Exh. 2 at 17‒18.) I find that the Acting General Counsel has put forth suffi- cient evidence to meet its initial burden to prove that Respond- ent’s confidentiality rule, when objectively and reasonably interpreted by Respondent’s employees, prohibits and interferes with the exercise of employees’ Section 7 rights to openly share the terms and conditions of their employment with other em- ployees and outside third parties including information con- tained in their personnel files such as disciplinary actions, wag- es and benefits, work progress reviews, employment offer let- ters and employee addresses and other contact information. In addition, I further find that any adverse impact on employees’ Section 7 rights is not outweighed by any credible business justifications from Respondent. In fact, Respondent has not shown or persuasively explained any legitimate business justi- fication for preserving confidentiality in its employees’ person- nel files, their contents, or in events or circumstances involving its employees that is necessary to outweigh the rule’s interfer- ence with Respondent’s employees’ Section 7 rights. Instead, Taylor says employees are free to share the contents of their personnel files with other employees and third parties despite the rule’s plain language contradiction. As a result, I place this rule in Category 3 and further find that the Confidentiality Rule is unlawful and any so-called business justification to preserve confidentiality here does not outweigh the Respondent’s em- ployees’ Section 7 rights to share their personnel files and openly discuss the terms and conditions of employment, includ- ing personnel files, their contents, and events and circumstanc- es of their employees. Here, the Respondent’s confidentiality rule is unlawful be- cause it does not present accompanying language that would tend to restrict its application but, instead, contains the broad and sweeping reference to the prohibition of sharing infor- mation contained in an employee’s personnel file. It therefore allows employees to reasonably assume that the confidentiality rule pertains to—among other things—certain protected em- ployee terms and conditions of employment contained in per- sonnel files such as disciplinary actions, wages and benefits, work progress reviews, employment offer letters and employee addresses and other contact information. See Allstate Insur- ance Co., 332 NLRB 759, 765 (2000) (Employees engaged in concerted activities protected by the Act when they discussed their working conditions with a magazine reporter.) By includ- ing nondisclosure of employee information in confidential per- sonnel files, in its confidential policy, the Respondent leaves to the employees the task of determining what is permissible and speculate what kind of information disclosure may trigger a rule violation and discipline. See Flex Frac Logistics, 358 NLRB 1131, 1140 (2012), affd. in relevant part, 746 F.3d 205 (5th Cir. 2014) (Board restated established precedent that ”. . . nondisclosure rules with very similar language are unlawfully overbroad because employees would reasonably believe that HARBOR FREIGHT TOOLS, U.S.A., INC. 13 they are prohibited from discussing wages or other terms and conditions of employment with nonemployees, such as union representatives̶ an activity protected by Section 7 of the Act.”) See also Double Eagle Hotel & Casino, 341 NLRB 112 (2004)(Rule prohibiting employees from discussing griev- ance/complaint information, disciplinary information, and other work-related matters unlawful). I also find that this rule, reasonably construed, would restrict employees’ protected activities. The rule at issue is not limited to Respondent’s own nonpublic, proprietary, or confidential records but also includes a specific prohibition on an employ- ee’s right to disclose or share information contained in an em- ployee’s personnel file including events and circumstances at work and wage and benefits information, disciplinary actions, performance reports, personal contact information, and other terms and conditions of their employment. See e.g., Eastex, Inc. v. NLRB, 437 U.S. 556, 565‒566 (1978) (Employees have a Sec. 7 right to discuss among themselves, and with the public, information about their terms and conditions of employment for the purpose of mutual aid and protection.) In contrast, the Con- fidentiality Rule here is distinguishable from rules in other recent cases which do not prohibit employees sharing infor- mation from their personnel files with other employees or third parties. See e.g., Medic Ambulance Service, Inc., 370 NLRB No. 65, slip op. at 2-3 (2021)(Board finds confidentiality rule lawful where disclosure of employer’s copyrighted, trade- marked, trade secrets, or other sensitive information prohibit- ed); LA Specialty Produce Co., 368 NLRB No. 93, slip op. at 3–4 (2019) (Board holds Employer’s confidentiality rule lawful as it narrowly applies to Employer’s “own nonpublic, proprie- tary records” including its customer and vendor lists); see also, Motor City Power Brokers, Inc., 369 NLRB No. 132, slip op. at 5 (2020) (Board finds confidentiality rule lawful and placed in Boeing Category 1(a) because employees would reasonably understand from the numerous examples of confidential infor- mation specified in the Employer’s handbook that they are limited to prohibiting disclosure of legitimately confidential and proprietary information rather than information contained in employees’ personnel files or pertaining to other terms and conditions of employment.) Further, employees must not be required to obtain prior au- thorization from the employer in order to engage in protected activity. See Schwan’s Home Service, 364 NLRB No. 20, slip op. at 4 (2016), citing Brunswick Corp., 282 NLRB 794, 795 (1987). Also, see G4S Secure Solutions (USA) Inc., 364 NLRB No. 92, slip op. at 4–5 (2016). As such, I find the Respondent’s maintenance of its Proprie- tary and Confidential Information rule stated in paragraphs 4(a), 5, and 6 of the complaint is unlawful under Section 8(a)(1) of the Act. B. Respondent’s Social Media and Networking Guidelines Rule Is Lawful. (Complaint Pars. 4(c) and 5.) Paragraph 4(c) of the Acting General Counsel’s complaint alleges that since about April 19, 2019 through January 20, 2020, Respondent has maintained the following policies in its employee handbook: (c) SOCIAL MEDIA AND NETWORKING GUIDELINES 3. Testimonials and Endorsements  Do not make any claims about Harbor Freight Tools […] that are not substantiated (i.e., for which you do not have adequate proof to back up the claim).  Do not make any factually inaccurate state- ments, particularly statements that may be dispar- aging […], regarding Harbor Freight Tools’ com- petitors or their services, or Harbor Freight Tools’ employees, officers, suppliers, or partners. The Acting General Counsel argues that this rule is unlawful in two respects because: “First, the portion of the rule prohibit- ing employees from posting any claims about the Employer that are not substantiated, i.e., for which you do not have adequate proof to back up the claim, is overbroad and unlawful . . . [; and s]econd, in the next bullet point of the rule, Respondent prohib- its employees from making any factually inaccurate statements about Respondent or its officers, which is again overbroad and unlawful.” (Tr. 15, GC Br. at 13-16.) Taylor generally testified that this rule is necessary because Respondent and the FTC have substantial business reasons for requiring that all testimonials or endorsements be true as Re- spondent, its business, competitors, etc. could suffer damages if an employee made false statements concerning Respondent, its competitors, its employees, its officers, suppliers, or partners. (Tr. 49‒50, 77.) In addition, Taylor further opined that the Respondent’s business purpose for this second challenged rule is to “protect against defamation, harassment, false statements.” (Tr. 52.) Taylor explains that this second challenged rule is intended by Respondent to protect Respondent’s customers, competitors, Respondent, and its employees, officers,13 suppli- ers, or partners “against false, misleading, or defamatory state- ments, as well as harassment.” (Tr. 47‒48, 74.) Taylor also has knowledge regarding the purpose of this rule and how it is implemented and understood by employees from her earlier work as the director of employee relations, conversations that she has had with different members of the legal team, other management and employees including her immediate boss, and situations that she has had with others. (Tr. 74‒75.) Taylor further opined that the rule is intended to ensure that if an em- ployee posts something on social media, that they are posting their own opinion, and that it is clear they are posting their own opinion and not the opinion on behalf of the Respondent or as Respondent’s agent. (Tr. 48.) Taylor opined that her under- standing of this part of Respondent’s second challenged policy is that it is intended to address: instances in which comments or testimonials and endorse- ments may be made about our products, our competitor’s 13 Taylor understands that “officers” included in this rule means Re- spondent’s chief financial officer and other executives at Respondent such as its president and executive vice president and owner as Re- spondent did not have a chief executive officer at the time of hearing. (Tr. 75.) DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 14 products that may make claims about our products that are in- accurate in an attempt to make our product, you know, sound better in comparison to the competitor’s product, protect against, you know, any false or misleading statements about our competitor’s product in an attempt to make our product look better in comparison. (Tr. 49.) The Acting General Counsel also argues that this rule is overlybroad as it prohibits all employee disparagement of Re- spondent, its business practices, and terms and conditions of employment. (GC Br. at 13-16.) Also, the Acting General Counsel further argues that Section 7 of the Act protects an employee’s right to publicly disparage his employer to gain support for an ongoing labor dispute or induce group action as long as the communication is not malicious. Id. I find that this second challenged rule involving Social Me- dia and Networking Guidelines which prohibit unsubstantiated claims against Respondent and factually inaccurate statements or disparagement against Respondent’s competitors or their services, or Respondent’s employees, officers, suppliers, or partners falls squarely into the category of lawful, com- monsense, facially neutral rules that require employees to foster “harmonious interactions and relationships” in the workplace and adhere to basic standards of civility. See Boeing, 365 NLRB No. 164, slip op. at 4 fn. 15: see also Motor City Pawn Brokers Inc. 369 NLRB No. 132 slip op. at 5-7 (2020) (same). In addition, even if a balancing test is called for here as to the nondisparagement portion of the Social Media and Net- working Guidelines rule, I further find the rule lawful after balancing the adverse impact on Section 7 activity with Re- spondent’s legitimate business justifications associated with this nondisparagement rule refenced above. Moreover, the nondisparagement rule here does not unlawfully prohibit state- ments to other employees which are intended to injure the repu- tation of the Respondent or its management personnel so it does not significantly restrict Section 7 rights. See Union Tank Car Company , 369 NLRB No. 120, slip op. at 2-3 (2020)(Board finds employer’s nondisparagement rule unlawful which pro- hibited statements to other employees that are intended to injure the reputation of the employer or its management personnel as significantly restricting Section 7 rights.) As such, I find the Respondent’s maintenance of its Social Media and Networking Guidelines rule stated in paragraphs 4(c), 5, and 6 of the com- plaint is lawful under Section 8(a)(1) of the Act. IV. RESPONDENT’S SOLICITATION AND/OR DISTRIBUTION RULE IS UNLAWFUL. (COMPLAINT PARS. 4(B) AND 5.) Paragraph 4(b) of the Acting General Counsel’s complaint alleges that since about April 19, 2019, through January 20, 2020, Respondent has maintained the following policies in its employee handbook: (b) SOLICITATION AND/OR DISTRIBUTION […] With respect to employee activity, Harbor Freight Tools prohibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose, including without limitation, for the purpose of financial gain, subscriptions, lotteries, or chari- ties, religious or political causes, memberships, outside organ- izations, or other personal matters unrelated to employment with Harbor Freight Tools. Employees may solicit co-workers about causes, interests, political issues, and membership dur- ing breaks or lunches and other non-working time in non- work areas, so long as employees do not disrupt or interfere with ongoing Harbor Freight Tools operations or harass other employees. […] For purposes of this policy only, “work area” is defined as any area where actual work is performed for Harbor Freight Tools. Likewise, “non-work area” is defined to include cafe- terias, lobbies, parking lots, break rooms, and restrooms, but excludes any areas where customers or clients may congre- gate or employees perform work for Harbor Freight Tools. “Working time” is defined as periods when employees are performing job duties on behalf of Harbor Freight Tools. […] The Acting General Counsel argues that this rule is unlawful because it also prohibits employees from all solicitation activi- ties in all of its work areas for any purpose, including solicita- tion for outside organizations and unions, during nonworking time and accordingly, under Respondent’s rule, employees can only solicit in nonworking areas during nonworking time, and that is unlawful under Board law. (Tr. 14‒15, 66‒67; GC Br. at 5, and 12‒13.) Taylor opined that the rules were justified given Respond- ent’s legitimate business reasons to protect customers’ and employees’ safety and to protect Respondent’s productivity of its employees. The third challenged rule is nondiscriminatory and prohibits all solicitation and distribution in Respondent’s working areas during working times despite the nature of the solicitation and distribution. Taylor has spoken to Stafford about Respondent’s business reason for this policy which is “to protect against disturbances, interruptions, distractions that may affect productivity and safety [at Respondent].” (Tr. 38‒39, 74.) Taylor also has knowledge regarding the purpose of this rule and how it is implemented and understood by employees from her earlier work as the director of employee relations, conversations that she has had with different members of the legal team, other management and employees including her immediate boss, and situations that she has had with others. (Tr. 74‒75.) Taylor further opines that Respondent sends out hundreds of full trucks a week with product in it, and “there’s a lot of different, kind of very organized activity happening in any one moment in terms of people pulling product, people filling the trucks, and somebody that is being distracted and is not focused on the machine that they are operating or the ma- chine that somebody else is operating, you know, there is al- ways a safety concern there.” (Tr. 41.) Taylor further ex- plained that specifically as to Respondent’s thousands of retail stores, there are also safety concerns that Respondent’s solicita- tion and/or distribution policy is intended to address because Respondent has stockrooms in its stores and Respondent has a lot of product in its stores that is stacked up, and Respondent’s associate employees are responsible at any given time for pull- ing product and filling the sales floor and there’s a forklift that might be loading a customer’s car with a product or moving heavier items in the stockroom. Anything over 50 pounds would require a team, so Respondent may have two people that HARBOR FREIGHT TOOLS, U.S.A., INC. 15 are potentially moving a product together at one time. (Tr. 41‒42.) Taylor further explained that various solicitation activities referenced in Respondent’s policy that implicate safety are directly connected to somebody talking to an employee at work about something unrelated to the job when an employee could get distracted and are unable to focus on doing the job and do- ing the job safely. (Tr. 42.) Taylor also opined that Respond- ent’s solicitation and/or distribution policy is intended to pro- tect an employee’s productivity at work because if somebody is speaking to an employee about something unrelated to the job, then the employee is distracted from the work that he or she is doing, potentially unable to support a customer, the employee is delayed in completing whatever task that they are doing, and all this impacts Respondent’s productivity and its labor standard. (Tr. 42.) Taylor has no knowledge whether the solicitation rule ap- plies to the warehouse area at the distribution centers or the call center as she doesn’t work very closely with the distribution center or call center and did not feel comfortable answering questions about how the solicitation rule is applied at the distri- bution center and call center. (Tr. 71‒72.). Again, the Acting General Counsel argues that these rules are overbroad and that they fail to clarify that the non- solicitation/distribution restrictions do not apply to working areas during non-work time. (GC Br. at 10, 12‒13.) I find that this Solicitation and/or Distribution rule, reasonably construed, would restrict employees’ protected activities and are overbroad as they fail to clarify that the non- solicitation/distribution restrictions do not apply to working areas during non-work time. It is well established that employ- ees have a right to solicit during nonworking time and distrib- ute literature during nonworking time in nonworking areas. Stoddard-Quirk Mfg. Co., 138 NLRB 615 (1962); see also Re- public Aviation Corp., 324 U.S. 793 (1945) (Restrictions on solicitation, without limitations or exceptions for nonwork time or nonwork areas have long been found contrary to the purpos- es of the Act.). Also, the Board has long recognized the princi- ple that “[w]orking time is for work,” and thus has permitted employers to adopt and enforce rules prohibiting solicitation during “working time,” absent evidence that the rule was adopted for a discriminatory purpose. Peyton Packing Co., 49 NLRB 828, 843 (1943), enfd. 142 F.2d. 1009 (5th Cir. 1944), cert. denied 323 U.S. 730 (1944). Also, the Boeing analysis referenced above in Section II., is inappropriate for the chal- lenged Solicitation and/or Distribution rule here as: “The Board in Boeing did not disturb longstanding precedent governing employer restrictions on solicitation and distribution, which already strikes a balance between employee rights and employ- er interests.” See UPMC Presbyterian Shadyside, 366 NLRB No. 142, slip op. at 1, fn. 5 (2018) (Rule unlawful on its face because, with no explanation of who is authorized to solicit and distribute, the rule leaves employees unable to determine whether they are “unauthorized persons” prohibited from solici- tation or distributing to patients or visitors at any time—a broader restriction than the Act allows.) Employers may ban solicitation in working areas during working time but may not extend such bans to working areas during nonworking time. See, e.g., Restaurant Corp. of Ameri- ca v. NLRB, 827 F.2d 799, 806 (D.C. Cir. 1987) (“[A]n em- ployer may not generally prohibit union solicitation . . . during nonworking times or in nonworking areas.”) (citing NLRB v. Babcock & Wilcox Co., 351 U.S. 105, 112–113 (1956); Repub- lic Aviation Corp. v. NLRB, 324 U.S. 793, 797–798 (1945)). However, the Respondent’s rule also prohibits solicitation in work areas, and does so without qualification. Fairly read, an employee would reasonably understand the rule to ban solicita- tion or distribution in work areas during nonworking time which is undefined and overly broad and ambiguous. Moreo- ver, banning solicitation or distribution during working hours is overbroad and presumptively invalid, as it would reasonably be construed as prohibiting such conduct during break times or periods when employees are not actually working while being present in working areas. Laidlaw Transit, Inc., 315 NLRB 79, 82 (1994). The Respondent’s stated justification for the rule— protecting customers’ and employees’ safety and to protect Respondent’s productivity of its employees does not extend to Respondent’s call center or warehouses where Taylor offered no business justifications and falls short at Respondent’s retail stores—does not apply to the ban on activity which occurs during nonwork time in working areas. Once again, while an employer may ban solicitation or dis- tribution in work areas during actual worktime, an employer may not extend the ban to work areas during nonworking time. Grill Concepts Services, Inc., 364 NLRB No. 36, slip op. at 26- 27 (2016); UPS Supply Chain Solutions, Inc., 357 NLRB 1295, 1296 (2011); Our Way, Inc., 268 NLRB 394, 394–395 (1983). There is no evidence that Respondent’s defined work areas or made it clear to employees that this rule does not extend to solicitation in working areas during their own nonworking time. The unlawfulness of this rule probably explains why Respond- ent revised and clarified this rule in its amended 2020 Hand- book. See GC Exh. 2 at 18; R Exh. 1 at 25-25. I further find this Solicitation and/or Distribution rule unlawfully prohibits Sec- tion 7 activity and violates Section 8(a)(1) of the Act. V. RESPONDENT’S OTHER AFFIRMATIVE DEFENSES LACK MERIT I deny Respondent’s request for attorney fees and costs as I find merit in two of the three claims brought forward in the Acting General Counsel’s complaint against Respondent’s three challenged rules. I also reject Respondent’s argument that the charge in this case questioning the Proprietary and Confidential Information and the Solicitation and Distribution Rules were filed too late to be properly adjudicated here as I find that these challenged rules remained in existence until January 20, 2020, and, as such, were a continuing violation under the Act to the extent I find them unlawful as discussed above. Finally, Respondent argues that the Acting General Coun- sel’s claim for relief - a cease-and-desist order regarding Re- spondent’s unlawful Solicitation and/or Distribution rule would only confuse Respondent’s employees and this remedy is somehow mooted out by Respondent’s issuance of its 2020 Handbook which no longer contains the unlawful rule. (R Br. at 27-29.) The Acting General Counsel counters this argument explaining that “[f]or a repudiation to serve as a defense to an DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 16 unfair labor practice finding, “it must be timely, unambiguous, specific in nature to the coercive conduct, and untainted by other unlawful conduct.” Alternative Cmty. Living, Inc., 362 NLRB 435, 436 (2015) quoting Casino San Pablo, 361 NLRB 1351, 1353 (2014). Additionally, there must be adequate publi- cation of the repudiation to the employees involved and the repudiation must assure employees that, going forward, the employer will not interfere with the exercise of their Section 7 rights. Id., citing Passavant Memorial Area Hospital, 237 NLRB 138, 138-139 (1978).” (GC Br. at 16.) Here, I find that Respondent did not cure its violation of Sec- tion 8(a)(1) by issuing a revised 2020 Handbook that deleted the unlawful Solicitation and/or Distribution rule at issue. The 2020 Handbook continues to contain the unlawful Proprietary and Confidential Information Rule and Respondent did not effectively repudiate the unlawful handbook rules simply by issuing a revised 2020 Handbook that only revised the Solicita- tion and/or Distribution rule. In order to cure its violation, Re- spondent would have been obligated, at a minimum, to clarify for its employees that they have a Section 7 right to solicit un- ion support and no evidence was presented that this occurred. Moreover, the revocation of the overly broad rule in this case was not free from other illegal conduct. Respondent continued to illegally put forth its Proprietary and Confidential Infor- mation Rule in its revised 2020 Handbook. See DaNite Hold- ings, Ltd., 356 NLRB 975, 981 (2011)(Same.) CONCLUSIONS OF LAW 1. The Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Respondent has unlawfully interfered with employ- ees’ exercise of their NLRA rights in violation of Section 8(a)(1) of the Act by maintaining the following rules in its em- ployee handbook and manual: (a) “ PROPRIETARY AND CONFIDENTIAL INFORMATION  Confidential information includes, but is not limited to, information from employee personnel files; financial in- formation about [Respondent; Respondent’s] policies, procedures, and training materials; product testing in- formation and analysis, and information from and about [Respondent’s] customers, including all personally iden- tifiable information . . . .  This policy shall include events and circumstances that involve . . . its employees.” (GC Exh. 1(c); GC Exh. 1(g); and GC Exh. 2 at 17-18.) (b) “SOLICITATION AND/OR DISTRIBUTION […] With respect to employee activity, Harbor Freight Tools pro- hibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose, including without limitation, for the purpose of financial gain, subscriptions, lotteries, or charities, religious or political causes, memberships, outside organiza- tions, or other personal matters unrelated to employment with Harbor Freight Tools. Employees may solicit co-workers about causes, interests, political issues, and membership dur- ing breaks or lunches and other non-working time in non- work areas, so long as employees do not disrupt or interfere with ongoing Harbor Freight Tools operations or harass other employees. […] For purposes of this policy only, “work area” is defined as any area where actual work is performed for Harbor Freight Tools. Likewise, “non-work area” is defined to include cafe- terias, lobbies, parking lots, break rooms, and restrooms, but excludes any areas where customers or clients may congre- gate or employees perform work for Harbor Freight Tools. “Working time” is defined as periods when employees are performing job duties on behalf of Harbor Freight Tools.” 3. The above unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. 4. The Respondent did not unlawfully violate Section 8(a)(1) of the Act with respect to its Social Media and Net- working guidelines policy or in any other way as alleged in the complaint in this matter. REMEDY Having found that the Respondent has engaged in certain un- fair labor practices, I find that they must cease and desist such practices and take certain affirmative action designed to effec- tuate the policies of the Act. In a typical case involving unlaw- ful workplace rules, the promulgator of the rules is ordered to rescind the unlawful provisions, provide inserts of revisions to the employee handbooks and manual and post an appropriate notice at all of Respondent’s nationwide facilities. On these findings of fact, conclusions of law, and upon the entire record, pursuant to Section 10(c) of the Act, I hereby issue the following recommended Order.14 ORDER The Respondent, Harbor Freight Tools USA, Inc., at all of its facilities nationwide, its officers, agents, successors, and as- signs, shall 1. Cease and desist from: (a) Maintaining the following unlawful employee handbook and manual rules that state that: (i) “PROPRIETARY AND CONFIDENTIAL INFORMATION  Confidential information includes, but is not limited to, information from employee personnel files; financial in- formation about [Respondent; Respondent’s] policies, procedures, and training materials; product testing in- formation and analysis, and information from and about [Respondent’s] customers, including all personally iden- tifiable information . . . .  This policy shall include events and circumstances that 14 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and Regulations, the findings, conclusions, and recom- mended Order shall, as provided in Sec. 102.48 of the Rules, be adopt- ed by the Board and all objections to them shall be deemed waived for all purposes. HARBOR FREIGHT TOOLS, U.S.A., INC. 17 involve . . . its employees.” (ii) “SOLICITATION AND/OR DISTRIBUTION […]  With respect to employee activity, Harbor Freight Tools prohibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose, including without limitation, for the purpose of financial gain, subscrip- tions, lotteries, or charities, religious or political causes, memberships, outside organizations, or other personal matters unrelated to employment with Harbor Freight Tools. Employees may solicit co-workers about causes, interests, political issues, and membership during breaks or lunches and other non-working time in non-work are- as, so long as employees do not disrupt or interfere with ongoing Harbor Freight Tools operations or harass other employees. […]  For purposes of this policy only, “work area” is defined as any area where actual work is performed for Harbor Freight Tools. Likewise, “non-work area” is defined to include cafeterias, lobbies, parking lots, break rooms, and restrooms, but excludes any areas where customers or clients may congregate or employees perform work for Harbor Freight Tools. “Working time” is defined as periods when employees are performing job duties on behalf of Harbor Freight Tools.” (b) In any like or related manner interfering with, restraining, or coercing employees in the exercise of the right guaranteed them by Section 7 of the Act. 2. Take the following affirmative action necessary to effec- tuate the policies of the Act. (a) Rescind the following provisions located in Respondent’s employee handbook and manual: (i) “ PROPRIETARY AND CONFIDENTIAL INFORMATION  Confidential information includes, but is not limited to, information from employee personnel files; financial in- formation about [Respondent; Respondent’s] policies, procedures, and training materials; product testing in- formation and analysis, and information from and about [Respondent’s] customers, including all personally iden- tifiable information . . . .  This policy shall include events and circumstances that involve . . . its employees.” (ii) “SOLICITATION AND/OR DISTRIBUTION […]  With respect to employee activity, Harbor Freight Tools prohibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose, including without limitation, for the purpose of financial gain, subscrip- tions, lotteries, or charities, religious or political causes, memberships, outside organizations, or other personal matters unrelated to employment with Harbor Freight Tools. Employees may solicit co-workers about causes, interests, political issues, and membership during breaks or lunches and other non-working time in non-work are- as, so long as employees do not disrupt or interfere with ongoing Harbor Freight Tools operations or harass other employees. […]  For purposes of this policy only, “work area” is defined as any area where actual work is performed for Harbor Freight Tools. Likewise, “non-work area” is defined to include cafeterias, lobbies, parking lots, break rooms, and restrooms, but excludes any areas where customers or clients may congregate or employees perform work for Harbor Freight Tools. “Working time” is defined as periods when employees are performing job duties on behalf of Harbor Freight Tools.” and remove such rules from any and all employee publications or documents to which it is a party. (b) Furnish all Respondent employees with inserts for the current policies that (1) advise employees that the unlawful prohibition or restriction has been rescinded, or (2) provide the language of a lawful prohibition or restriction, or to the extent that the Respondent has not already done so, publish and dis- tribute revised policies that (1) do not contain the unlawful prohibition or restriction, or (2) provide the language of a law- ful prohibition or restriction. (c) Within 14 days after service by the Region, post at all of Respondent’s facilities, copies of the attached notice marked “Appendix.”15 Copies of the notice, on forms provided by the Regional Director for Region 28, after being signed by the Re- spondent’s authorized representative, shall also be posted by the Respondent and maintained for 60 consecutive days in con- spicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. In addition to physical post- ing of paper notices, notices shall be distributed electronically, such as by email, posting on an intranet or an internet site, and/or other electronic means, if the Respondent customarily communicates with its employees by such means. In the event that, during the pendency of these proceedings, the Respondent has gone out of business or closed the facility involved in these proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the notice to all current employees and former employees employed by the Respondent at any time since December 11, 2018. 15 If the facility involved in these proceedings is open and staffed by a substantial complement of employees, the notices must be posted within 14 days after service by the Region. If the facility involved in these proceedings is closed due to the Coronavirus Disease 2019 (COVID–19) pandemic, the notices must be posted within 14 days after the facility reopens and a substantial complement of employees have returned to work, and the notices may not be posted until a substantial complement of employees have returned to work. Any delay in the physical posting of paper notices also applies to the electronic distribu- tion of the notice if Respondent customarily communicates with its employees by electronic means. If this Order is enforced by a judg- ment of a United States court of appeals, the words in the notice read- ing “Posted by Order of the National Labor Relations Board” shall read “Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board.” DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 18 (d) Within 21 days after service by the Region, file with the Regional Director a sworn certification of a responsible official on a form provided by the Region attesting to the steps that the Respondent has taken to comply. Dated: Washington, D.C. March 12, 2021 APPENDIX NOTICE TOEMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated Federal labor law and has ordered us to post and obey this no- tice. FEDERAL LAW GIVES YOU THE RIGHT TO Form, join, or assist a union Choose representatives to bargain with us on your be- half Act together with other employees for your benefit and protection Choose not to engage in any of these protected activi- ties. WE WILL NOT interfere with, restrain, or coerce you in your exercise of the above rights. WE WILL NOT maintain in our Employee Handbook, or an- ywhere else, rules that interfere with your right to share in- formation relating to your wages, hours, or other terms and conditions of employment, in furtherance of your exercise of the above rights, including: PROPRIETARY AND CONFIDENTIAL INFORMATION  Confidential information includes, but is not limited to, information from employee personnel files; financial in- formation about [Respondent; Respondent’s] policies, procedures, and training materials; product testing in- formation and analysis, and information from and about [Respondent’s] customers, including all personally iden- tifiable information . . . .  This policy shall include events and circumstances that involve . . . its employees. WE WILL NOT maintain in our Employee Handbook, or an- ywhere else, rules that interfere with your right during non- working time to solicit in our work areas that are not on the retail floor, in furtherance of your exercise of the above rights, including: SOLICITATION AND/OR DISTRIBUTION  With respect to employee activity, Harbor Freight Tools prohibits all solicitation activities in Harbor Freight Tools’ work areas for any purpose . . . WE WILL NOT in any like or related manner interfere with your rights under Section 7 of the Act. WE WILL rescind the rules set forth above, and WE WILL a) furnish you with inserts for the current Employee Handbook that advise that the rules have been rescinded; or b) publish and distribute a revised Employee Handbook that does not contain the rules. HARBOR FREIGHT TOOLS USA, INC. The Administrative Law Judge’s decision can be found at http://www.nlrb.gov/case/28-CA-232596 or by using the QR code below. Alternatively, you can obtain a copy of the deci- sion from the Executive Secretary, National Labor Relations Board, 1015 Half Street, S.E., Washington, D.C. 20570, or by calling (202) 273–1940.