An old NLRB rule threatens quality circles. (National Labor Relations Board's 1935 amendment eliminating management-controlled sham unions; includes related article on employee involvement programs at Du Pont)

An Old NLRB Rule Threatens Quality Circles

XYZ Inc., a large manufacturing company, had just instituted an employee-management quality program that won praise from almost everyone involved. The company was already reaping the benefits of the effort--from increased production to a boost in morale. There was just one small problem: The program was illegal. It turns out, employee-management cooperation groups and quality improvement programs, especially those at nonunionized companies, may be illegal under a 55-year-old unfair labor practices provision designed to protect a union's right to organize employees.

A recent joint survey by the U.S. General Accounting Office (GAO) and the University of Southern California found that 60 percent of Fortune 500 firms either have implemented or are experimenting …