In-N-Out Burger

The U.S. Court of Appeals for the Fifth Circuit has upheld a National Labor Relations Board decision holding that In-N-Out Burger is in violation of labor law for banning its employees from wearing pins to show solidarity with a movement to raise the minimum wage.

The case involves an In-N-Out Burger restaurant in Austin where in 2015 employees started wearing small “Fight for $15” pins on their uniforms in support of a national movement advocating for a higher minimum wage, the right to form a union without intimidation, and other improvements for low-wage workers.

California-based In-N-Out Burger operates a chain of more than 300 fast food restaurants in several western states, including Texas. According to the decision, its employees are required to follow a detailed appearance code consisting of specific clothing, and the company also maintains a rule in its employee handbook that states “Wearing any type of pin or stickers is not permitted.”

However, the restaurant chain requires its employees to wear company-issued buttons twice a year—one celebrating the Christmas holiday and another that solicits donations to the In-N-Out foundation focusing on preventing child abuse and neglect, the court noted.

After employees at the Austin franchise started wearing the pins, one of the employees was called into an assistant manager’s office and told to remove the button because it violated the company’s uniform policy, according to the decision.

The employee later filed a complaint with the NLRB. The NRLB’s general counsel determined the company’s “no pins or stickers” rule violated the National Labor Relations Act. But at a hearing before an NLRB administrative law judge, In-N-Out argued that its interest in maintaining a unique public image and its concern for food safety constituted “special circumstances” that justified their rule.

The administrative law judge rejected In-N-Out’s arguments, a decision that was later upheld by the NRLB, which ultimately issued a cease-and-desist letter to In-N-Out for their pin-and-sticker ban that “makes no exception for buttons or insignia pertaining to wages, hours, terms and conditions” among other things.

In-N-Out appealed the NRLB decision to the Fifth Circuit, asking for the court to set the ruling aside. The NRLB cross-appealed, asking the appellate court to enforce its decision.

The Fifth Circuit sided with the NRLB, rejecting In-N-Out’s argument that the minimum wage pins compromised its public image—which, the company claimed, includes a menu that hasn’t changed since 1948, a sparkling clean environment, and employee uniforms with a limited number of elements, to which nothing can be added.

The Fifth Circuit also determined that In-N-Out’s policy requiring employees to wear pins twice a year, but to be button-free the remainder of the year, undercut its “special circumstances” argument.

“In-N-Out contends that Christmas and In-N-Out Foundation buttons do not undermine its ‘public image’ argument because they are ‘part of the uniform.’” But this assertion hurts rather than helps the company’s case,” wrote Judge James Graves.

“If the employee uniform—which In-N-Out describes as an integral component of its overall public image—changes several times each year, then either the company’s interest in maintaining a ‘consistent’ public image is not as great as it suggests, or, alternatively, the uniform does not play as critical a role in maintaining that public image as In-N-Out claims,” Graves wrote.

The Fifth Circuit also rejected In-N-Out’s argument that its pin-and-sticker ban should be allowed under special circumstances because the “Fight for $15” pin was small and compromised food safety because an employee might not notice if it fell into a customer’s food.

“The board’s conclusion that In-N-Out failed to establish ‘special circumstances’ based on its purported food safety concern is reasonable and supported by substantial evidence,” Graves wrote.

Mischa Bauermeister, a NLRB attorney who argued the case at the Fifth Circuit, declined to comment on the decision.

Bruce J. Sarchet, a shareholder in the Sacramento office of Littler Mendelson who represents In-N-Out, did not return a call for comment.