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Client Alert - NLRB Ruling Condemns Blanket Policies Requiring Employee Confidentiality During Internal Investigations

Oct 18, 2012Employment Law

Employers who receive complaints from employees about their co-workers frequently direct that the details of any ensuing investigations be kept confidential. The rationale is that restricting discussion of an employee's allegations against a co-worker will serve to protect the integrity of the investigation, protect the reputations of individuals falsely accused of misconduct in the workplace, and ensure that witnesses do not compare stories.

This practice was called into question in a recent National Labor Relations Board decision. In July of this year the NLRB ruled in Banner Health System, 358 NLRB No. 93 (2012) that blanket confidentiality requirements violate Section 8(a)(1) of the National Labor Relations Act (NLRA) because they restrain employees in the exercise of their right to communicate with co-workers about their wages, hours and other terms and conditions of employment, rights protected by Section 7 of the NLRA, and which include discussion over possible discipline.

In the Banner Health System case, the employer routinely asked employees making complaints about fellow employees not to discuss their claims with coworkers while internal investigations were ongoing. The Board concluded that the employer committed an unfair labor practice because the confidentiality requirement imposed by the employer 'had a reasonable tendency to coerce employees, and so constituted an unlawful restraint of Section 7 rights.' The Board held that the employer's 'generalized concern with protecting the integrity of its investigations was insufficient to outweigh employees' Section 7 rights.'

Going forward, the burden will be on employers to justify any prohibition on employee discussion of claims asserted against co-workers. Employers must show that they have a legitimate business justification for confidentiality that outweighs employees' Section 7 rights to communicate about terms and conditions of employment. According to the Board, a legitimate business justification for confidentiality can be based on one of four reasons:

A. A witness is in need of protection;

B. Evidence is in danger of being destroyed;

C. Testimony is in danger of being fabricated; or

D. There is a need to prevent a cover-up.

In light of the Board's ruling, employers should revise blanket policies and HR forms so as to omit requirements that employees not discuss ongoing investigations with their co-workers. Instead, employers should evaluate each complaint on a case-by-case, witness-by-witness basis and determine whether instructing employees involved in the investigation to keep certain information confidential is justified to avoid corruption of the investigation under one or more of the four aforementioned categories.