The Obama NLRB and Confidentiality Rules

The Obama NLRB and Confidentiality Rules

 In a decision that is a preview for employers of things to come from the "new" and approved Obama NLRB, the Board affirmed an administrative law judge who found a confidentiality rule to be overly broad. MCPc, Inc. [an enhanced version of this decision is available to lexis.com subscribers]  The rule stated that the dissemination of confidential information within the company such as personal and financial information will be subject to disciplinary action or possible termination. An employee was discharged after identifying the salary of the CEO and saying that additional workers could have been hired during a team building lunch meeting. The judge overturned the discharge, and the Board affirmed that decision.

The Board stated that the rule would reasonably be construed by employees to prohibit discussion of wages or other terms and conditions of employment with their co-workers. The Republican member of the panel agreed that the rule violated the Act since  it would prohibit protected employee discussions regarding compensation without other important justifications. Member Miscimarra stated his disagreement with the standard the Board currently uses with respect to overly broad rules and policies. Currently, rules are unlawful where the employees would reasonably construe the language to prohibit Section 7 activity even though the rules do not explicitly restrict protected activity and are not applied in response to such activity.

The Bush Board had adopted an approach where it would not read particular phrases in isolation. A violation would not be found just because a rule could be read to restrict Section 7 activity. Former member Hayes had referred to the current rule as one where the Board, and not the affected employees, interprets words and phrases of a challenged rule.

The reality for employers is that vague and broad rules that are not accompanied by examples or explanations are likely to be found to violate the Act. Over the years, employers have been reluctant to acknowledge the existence and impact of the National Labor Relations Act on their employees or to refer to the Act and its protections in company policies and procedures. Given the inclination of the current Board to resolve doubts concerning policies in favor of finding a violation, employers should consider including a statement of what conduct the Act protects. Employers have included equal employment opportunity policies for years with the statement that they will not discriminate in a manner that violates the law. The inclusion of a similar statement concerning the Act  would make it much harder to establish the argument that employees might construe policies to prohibit Section 7 activity when the employer has stated its policies are not so intended and has identified conduct that it protected. Ignoring the new direction of the Board and failing to review policies and rules is an invitation to an unpleasant experience if challenged before the Board.

 For additional Labor and Employment law insights from John Holmquist, visit the Michigan Employment Law Connection.

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