Employer No-Recording Policies May Violate NLRA Says the Second Circuit

On June 1, 2017, the U.S. Court of Appeals for the Second Circuit, which covers Connecticut, New York and Vermont, upheld a National Labor Relations Board (“NLRB”) finding that Whole Foods Market Group, Inc.’s no-recording policy was overbroad and violated the National Labor Relations Act (“NLRA”).

In Whole Foods Market Group, Inc. v. NLRB, Whole Foods’ employee handbook contained a provision that prohibited employees from recording conversations, phone calls, and meetings, without first obtaining managerial approval.  The court concluded that this no-recording policy violated the NLRA.  The NLRA deems it an unfair labor practice “to interfere with, restrain or coerce employees in the exercise of their rights [to, among other things, engage in concerted activities for the purposes of collective bargaining or other mutual aid or protection.]  Whole Foods insisted that its policy was not intended to interfere with employees’ rights to engage in concerted activity or to prevent them from discussing their jobs, and that it was merely a general prohibition against recording in the workplace.  Whole Foods argued that its policy was “to promote employee communication in the workplace” by assuring employees that their remarks would not be recorded.

Whole FoodsThe Second Circuit found, however, that the seemingly neutral policy was overbroad and could “chill” an employee’s exercise of rights under the NLRA.  In other words, the policy prohibited recording regardless of whether the recording involved an exercise of those rights.  As a result, “’employees would reasonably construe the language to prohibit’ recording protected by [the NLRA].”  Despite finding that Whole Foods’ policy violated the NLRA, the Second Circuit said that “[i]t should be possible to craft a policy that places some limits on recording audio and video in the work place that does not violate the [NLRA].”  Such a policy might be acceptable if it was narrow in scope, and furthered a legitimate safety concern.

Previously, in 1989, the Second Circuit held that recording a conversation at work in violation of a no-recording policy might not be sufficient “cause” for the termination of an employment agreement under Connecticut law.  In  Heller v. Champion Int’l Corp, (2d Cir. 1989), the Second Circuit rejected the employer’s assertion that such a recording constituted an act of disloyalty on the employee’s part.  According to the Second Circuit in Heller, the employee’s surreptitious tape-recording to be sure, represents a kind of ‘disloyalty’ to the company, but not necessarily the kind of disloyalty that under these circumstances would warrant dismissal as a matter of law. . . . Considering the range of factors that might have justified [the employee’s] conduct, especially his belief that he was gathering evidence in support of a possible claim of age discrimination, we cannot say that [the employer] had sufficient cause, as a matter of law, to dismiss him.

The Second Circuit’s latest decision in Whole Foods makes clear that an overbroad no-recording policy in the workplace will be stricken in violation of the NLRA.  At the very least, courts may disregard an overbroad policy depending upon the circumstances surrounding the recording.  In order for a no-recording policy to withstand scrutiny, care must be taken to limit the scope of the prohibition, and consider whether the employee’s purpose for recording jeopardizes an employer’s legitimate interest.

This post was written by Salvatore G. Gangemi of Murtha Cullina.

Employee’s Disparaging and Misleading Tweets May Be Protected Under NLRA: Holy Guacamole!

Guacamole, Food, disparaging social mediaRetail employers dismayed by employees publicly airing workplace grievances in disparaging social media posts must think twice before taking disciplinary action.  On August 18, 2016, the National Labor Relations Board (“NLRB”) confirmed the finding by Administrative Law Judge Susan A. Flynn that Chipotle’s social media policy forbidding employees from posting “incomplete” or “inaccurate” information, or from making “disparaging, false, or misleading statements” on Twitter, Facebook and other social media sites violates Section 8(a)(1) of the National Relations Labor Act (“the Act”).

Chipotle discovered that an employee responded to a customer’s tweet thanking Chipotle for a free food offer, by tweeting back: “@ChipotleTweets, nothing is free, only cheap #labor. Crew members make only $8.50hr how much is that steak bowl really?”  Then, attaching a news article describing how hourly workers at Chipotle were required to work on snow days while certain high-level employees were not, the employee tweeted his displeasure, specifically referencing Chipotle’s Communications Director: “Snow day for ‘top performers’ Chris Arnold?”  Informed by his manager that Chipotle considered his tweets to be in violation of Chipotle’s social media policy, the employee removed them at Chipotle’s request.  Then, several weeks later, Chipotle fired the employee after he circulated a petition about employees not receiving required breaks.

Finding the provision in Chipotle’s policy prohibiting employees from spreading “incomplete” or “inaccurate” information to be unlawful, Judge Flynn opined that: “An employer may not prohibit employee postings that are merely false or misleading. Rather, in order to lose the [NLRA]’s protection, more than a false or misleading statement by the employee is required; it must be shown that the employee had a malicious motive.” Judge Flynn also found the policy provision prohibiting “disparaging” statements to be unlawful, explaining that it “could easily encompass statements protected by Section 7 [of the NLRA]” including “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”   Although Chipotle’s social media policy contained a disclaimer that the policy “does not restrict any activity that is protected by the National Relations Labor Act, whistleblower laws, or any other privacy rights,” Judge Flynn concluded that this “sentence does not serve to cure the unlawfulness of the foregoing provisions.”

The NLRB adopted Judge Flynn’s decision that Chipotle was wrong, not only for firing the employee, but for attempting to limit his commentary on social media by its unlawfully termed social media policy.  While agreeing with Judge Flynn’s reasons for finding the social media policy unlawful, the NLRB disagreed with Judge Flynn’s finding that Chipotle violated the NLRA by asking the employee to delete the tweets.  In particular, while Judge Flynn opined that the employee engaged in “concerted activity” even though he did not consult with other employees before posting his tweets because “concerted activities include individual activity where individual employees seek to initiate or to induce … group action,”  the NLRB disagreed, asserting, with no true explanation, that it did not find the employee’s conduct to be concerted.  Agreeing that Chipotle violated the NLRA by terminating the employee after he engaged in protected concerted activity by circulating a petition regarding the Company’s break policy, the NLRB required Chipotle to, among other things, post signs acknowledging that its social media policy was illegal, and to re-instate the employee with back pay.

The message from the NLRB to retail employers is that, barring malicious misstatements, speech concerning terms and conditions of employment is often protected activity, even for employees who want to criticize their employers on Twitter and other social media websites.  To avoid Chipotle’s fate, ensure that your social media policies are up to date and provide for the increasing protections afforded to employee social media activity by the NLRB.

©2016 Epstein Becker & Green, P.C. All rights reserved.

Amazon Settlement with NLRB a Reminder for Employers — “Confidential” Wage Policies Violate the NLRA

Barnes Thornburg

Last week in a settlement with the NLRB, online retailer Amazon agreed to allow its largely non-union workforce to discuss pay and working conditions with each other without fear of discipline. The settlement, as reported by Bloomberg News which obtained a copy, required Amazon to rescind certain work rules that prohibited workers from sharing information with one another, although Amazon did not admit any violation of the NLRA.

Amazon’s work rule was considered too broad by the NLRB because it prohibited discussion of wages and working conditions, considered quintessential “protected concerted activity” under the NLRA. In Amazon’s case, the NLRB got involved when an employee was disciplined after voicing concerns about security in the employee parking lot. The employee apparently filed a charge with the NLRB protesting his discipline and this led the NLRB to examine not only the circumstances of the employee’s discipline, but to scrutinize Amazon’s policies as well.

This settlement serves as a reminder to all employers, both union and non-union, that policies which prohibit discussion of terms and conditions of employment are on their face unlawful under the NLRA.  It is tempting for employers to require that wages or other benefits be kept “confidential” for a variety of reasons, but enforcing such policies is an easy way to draw unwanted attention from the NLRB, especially given the Board’s current focus on protected concerted activity.

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NLRB Shows Some Restraint in its Protection of Employee Social Media Communications: Employee Termination Arising From “Egregious” and “Insubordinate” Facebook Posts Was Legal Under the NLRA

Mintz Levin Law Firm

In the wake of the NLRB’s aggressive crackdown on social media policies, many employers have asked: “Is there any limit to what employees can post on social media about their employers?”  It appears that there is.  Just last week, a former employee of the Richmond District Neighborhood Teen Center in San Francisco learned this the hard way when the Board dismissed his complaint that the Center violated Section 8(a)(1) of the National Labor Relations Act after it pulled a rehire offer after it discovered that he particpated in an inappropriate Facebook exchange.

During the 2011-2012 school year, Ian Callaghan and Kenya Moore both worked for the Center’s afterschool program—Callaghan as a teen activity leader and Moore as the teen center program leader.  In May 2012, the Center held a staff meeting during which it solicited and received both positive and negative feedback from its staff, including Callaghan and Moore.  In July 2012, Callaghan and Moore received letters inviting them to return to the Center for the 2012-2013 school year; this time both as activity leaders.

The following month, Callaghan and Moore communicated over Facebook about (i) refusing to obtain permission before organizing youth activities (“ordering sh*t, having crazy events at the Beacon all the time.  I don’t want to ask permission…”; “Let’s do some cool sh*t and let them figure out the money”; “field trips all the time to wherever the f#@! we want!”), (ii) disregarding specific school district rules (“play music loud”; “teach the kids how to graffiti up the walls…”), (iii) undermining leadership (“we’ll take advantage”), (iv) neglecting their duties (“I ain’t go[]never be there”), and (v) jeopardizing the safety of participating youth and the program overall (“they start loosn kids I aint helpin”; “Let’s f#@! it up”).  When the Center’s administration became aware of the postings, it revoked the offers to rehire, and Callaghan filed a charge with the Board.

Under Section 7 of the Act, employees have the right to engage in concerted activities for their mutual aid and protection, including complaining to one another about the terms and conditions of their employment.  In that vein, an employer may not take adverse action against employees for exercising their Section 7 rights without violating Section 8(a)(1) of the Act.  That said, employees can take it too far and lose the protection of Section 7 when their conduct is particularly egregious or of such a character as to render the employees unfit for further service.

Here, although Callaghan and Moore previously had engaged in protected activity during the May 2012 staff meeting when they offered negative feedback about the Center, and although neither Callaghan nor Moore had ever engaged in any acts of insubordination, the Board held that they lost the Act’s protection because “[t]he magnitude and detail of insubordinate acts advocated in the [Facebook] posts reasonably gave [the Center] concern that Callaghan and Moore would act on their plans, a risk a reasonable employer would refuse to take.”

Several years ago, the Richmond District Neighborhood Center decision may have been a foregone conclusion.  But in light of the current Board’s aggressive approach to Section 7 protections, the decision provides employers with reassurance that Section 7 has retained at least some outer bounds.  The decision provides some guidance for defining “insubordination” in social media policies, for example, to include communications pervaded by detailed plans to jeopardize the employer’s very existence, violate legally enforceable employer policies, or neglect job duties.

For a full discussion of the Board’s recent approach to social media policies, see George Patterson’s September 3, 2014 posting “NLRB Continues Aggressive Crackdown on Social Media Polices.”

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The NLRB at it Again: Blanket Rules Prohibiting Employees from Discussing Ongoing Investigations Violates NLRA Absent “Legitimate and Substantial Justification”

An article by Eric E. Hobbs of Michael Best & Friedrich LLP regarding The NLRB recently appeared in The National Law Review:

 

The National Labor Relations Board (NLRB or Board) on July 30, 2012, held that a blanket rule prohibiting employees from discussing ongoing internal investigations – for example, of employee misconduct, harassment, or criminal conduct – violates the employees’ rights under the National Labor Relations Act (NLRA) absent “legitimate and substantial justification”.

In Banner Health System, the employer’s human resources consultant, as a matter of course, had asked employees involved in internal investigations not to discuss the investigation’s details, the employees’ roles or what had been said during the consultant’s interviews while the investigation continued. In particular, she had asked employee James Navarro, whom she had interviewed as a part of an insubordination investigation, to maintain his silence. Navarro then filed an unfair labor practice charge against the employer, alleging that the consultant’s request had violated his rights under Section 7 of the NLRA, which protects, among other things, communications between employees regarding terms and conditions of employment.

The NLRB found merit to the charge and issued a complaint, which went to hearing before one of the NLRB’s administrative law judges. The judge found the employer’s conduct not to have violated Navarro’s Section 7 rights because the consultant’s request had been justified by the employer’s concern with protecting the integrity of its insubordination investigation.

The NLRB reversed its judge’s decision on that point. It held that, in order for an employer to justify a prohibition against employee communications regarding ongoing investigation, the employer must demonstrate the existence of a “substantial business justification” that outweighs the employees’ Section 7 rights. And a general concern with protecting the integrity of an investigation, according to the Board, was not substantial enough to meet the bar.

The Board gave examples of justifications that might qualify as sufficiently substantial to outweigh employees’ Section 7 rights: If a witness needed protection; if the employer reasonably believed that evidence might be destroyed or fabricated; or if maintenance of silence was necessary to prevent a “cover-up.” Notably, the Board did not say that those three circumstances were examples only, rather than an exclusive list of potentially adequate justifications. Our best educated guess is that they are examples only.

We do not have to guess, however, that the NLRB would find a blanket prohibition against communication by employees among themselves during the course of an ongoing employer investigation to be unlawful. In fact, a requirement of such silence in any case the employer cannot show substantial business justification for it will be found by the Board to violate the employer’s workers’ Section 7 rights.

The Board’s decision is not without support by its own precedent. In the late 1980s, the NLRB had held that it was unlawful under Section 7 of the Act for an employer to direct an employee who complained of sexual harassment not to talk to anyone other than her supervisors about the matter. The Board found that “anyone” could include the employee’s union representatives and that such a prohibition ran afoul of the NLRA.

The Banner Health System decision, however, greatly expands that principle. Employers now must be careful whenever directing employees not to communicate among themselves about, or to maintain as “confidential” all matters related to, an internal investigation. Protection of the integrity of the investigation is not going to be a sufficiently substantial reason for imposing such a prohibition, and the burden will be on the employer to establish that it had a “substantial business justification” for the prohibition that outweighed its employees’ rights under Section 7 of the NLRA.

In the event you believe it necessary to maintain the confidentiality of an internal investigation, we suggest that you take several steps:

  • First, make sure you are able to articulate a significant concern particular to the investigation that a failure by any witness to maintain confidentiality will result in serious, negative consequences. For instance, where employer, employee or third-party safety might be jeopardized, where a target of or participant in the investigation might become violent, where the target of or participant in the investigation might threaten or manipulate other witnesses, or where evidence might be destroyed or lost.
  • Second, be clear to limit your request for confidentiality. Limit it explicitly to confidentiality of the interview conducted, the facts known to the individual, his or her impressions and opinions, the existence of the investigation, and other of its elements. Make clear that the confidentiality is to be maintained only during the pendency of the investigation, but not afterwards. And, if possible, articulate that the confidentiality is to be maintained not just among employees but also among friends and family members.
  • Finally, do not threaten to discipline employees for breaches of confidentiality regarding the investigation at the time you communicate your confidentiality request, unless the investigation is one that clearly and “substantially” justifies such a threat.

© MICHAEL BEST & FRIEDRICH LLP

Court Invalidates Ambush Election Regulation

Mark A. Carter of Dinsmore & Shohl LLP recently had an article, Court Invalidates Ambush Election Regulation, published in The National Law Review:

On May 14, 2012, the United States District Court for the District of Columbia invalidated the controversial regulation of the National Labor Relations Board (NLRB) that would have dramatically reduced the time frame of union organizing campaigns from the filing of a representation petition to the representational election. Chamber of Commerce, et al. v. NLRB. The “ambush election” regulation, which was implemented on April 30, 2012, was roundly criticized because it limited the ability of employers to exercise their right under §8(c) of the National Labor Relations Act to communicate with employees regarding the impact of selecting a collective bargaining representative.

In an 18 page opinion, Judge James E. Boasberg granted summary judgment to the United States Chamber of Commerce (US Chamber) and the Coalition for a Democratic Workforce (CDW), agreeing that the NLRB did not have statutory authority to implement the regulation because the NLRB was not possessed of a quorum when the regulation was voted on. On December 16, 2011 the vote on the regulation was conducted by e-mail. While Chairman Mark Pearce and former Member Craig Becker both voted to implement the regulation, Member Brian Hayes did not vote. The US Chamber and the CDW argued that as Member Hayes did not “participate” in the vote, there was not a quorum of three NLRB members on the vote, and as such, the implementation was invalid. The NLRB argued that as Hayes had an “opportunity” to vote, the NLRB did have a quorum and, therefore, the regulation was validly implemented as a quorum existed.

The Court disagreed, citing a Woody Allen observation that “eighty percent of life is just showing up.” The Court held that the statutory mandate of a quorum for an administrative agency to implement a regulation was a foundational requirement. In the e-mail era, that mandate was not fulfilled simply because a Board Member received an opportunity to vote. Rather, active participation in the vote is required. The Court noted that while it was unnecessary to treat the issue of whether the failure to participate in the vote was “intentional,” the parties were well served to acknowledge that “such things happen all the time.” (citing a New York Times story reporting on the Wisconsin legislators who fled the state in an effort to deny Republican legislators the ability to form a quorum to vote on legislation limiting the rights of public unions in that state)

The Court concluded that the “ambush election” regulation was invalid, granting judgment against the NLRB, and directing that “representation elections will have to continue under the old procedures.” While the Court did not enter an injunction prohibiting the NLRB from enforcing the final rule, this opinion is a final adjudication on the merits of the case in the district where the NLRB is headquartered and willful disobedience of the Court’s judgment is unlikely. An appeal of the decision by the NLRB is likely.

© 2012 Dinsmore & Shohl LLP

Organized Labor’s Big Day: Are You Ready?

The National Law Review recently published an article by R. Scott Summers of Dinsmore & Shohl LLP regarding Changes that Affect Private Sector Employers:

On April 30, 2012, just a few short weeks away, two critical changes that will affect just about every private sector employer are slated to go into effect. Whether your organization has a union, or is union-free, these changes could have important implications for your workplace policies and will affect the way you handle issues during union organizing campaigns.

As of April 30, 2012, most private sector employers1 – union and non-union – will be required to post a notice entitled “Employee Rights Under the National Labor Relations Act (NLRA).” The original effective date for posting this notice was January 31, 2012, but that date was pushed back until this spring. Among other things, the notice informs employees that they have the right to:

  • organize a union
  • discuss wages, benefits and other terms and conditions of employment with co-workers
  • strike and picket
  • choose not to participate in such activities.

The notice also lists examples of unlawful employer conduct and provides information about how to file unfair labor charges against an employer.

None of the various legal challenges to this controversial National Labor Relations Board (NLRB) posting rule have yet been effective. Earlier this month a U.S. District Court Judge upheld the NLRB’s rule requiring the posting. The Judge noted among other things, that the employers had not established that they would suffer irreparable harm if the posting requirement were allowed to take effect. This was particularly the case, according to the judge, in light of her prior order invalidating the portion of the NLRB’s rule that made the mere failure to post the notice an unfair labor practice. The Judge also noted that the public interest also favored denying the employers’ requested injunction because the notice was intended to increase employees’ awareness of their rights, which the judge observed was “undoubtedly in the public interest.”There is another legal challenge to the posting rule pending in a federal District Court in South Carolina, but no decision has been issued in that case and there is no reason to expect one will be issued before April 30.

The poster is available on the NLRB’s web site at www.nlrb.gov. Also, various businesses which offer reproductions of government-required employment postings have already developed products that incorporate the new NLRB posting.

In addition to the requirement of posting a notice of employee rights under the NLRA, the NLRB has recently confirmed its plan to launch a website designed to inform nonunion employees of their rights under the NLRA. The NLRB’s focus in launching the website is to reach and educate nonunion employees about their right to engage in protected, concerted activity under the NLRA. As a supplement to the website, the NLRB plans to distribute educational brochures containing examples of issues that have arisen in past and current cases before the NLRB. The brochures, which will be offered in English and Spanish, will be distributed through advocacy groups and other federal agencies, such as the Department of Labor.

Obviously these two initiatives taken in tandem may serve to push non-union workforces to consider unionization. Additionally, the increased awareness of the right to bring a complaint against an employer regardless of one’s union membership will certainly result is an increase in the number of complaints filed with the NLRB.

The other big change, also taking effect on April 30, 2012, is a new rule that will revamp aspects of the union election process. What will this mean for your business?

  1. elections will proceed quicker than ever before
  2. you will have fewer opportunities to raise challenges throughout the election process

These rules illustrate the importance of engaging in union prevention efforts long before organizing begins.

The rule, popularly referred to as the “quickie elections” rule, will change the process for contesting union petitions and limit employers’ opportunities to challenge certain aspects of the election process before a union election. The NLRB’s goal is to speed up the election process by mandating that certain election issues be dealt with after the union election. (See our Jan. 4, 2012 insightNLRB’s New “Ambush Elections” Rule).

Eliminating pre-election appeals, limiting decisions on critical issues until after the election, and speeding up the election process, could substantially reduce the amount of time an employer has to communicate with its employees before an election. In fact, the election “campaign period” could be reduced to just a few weeks. Under the current rules, elections are usually scheduled at least a month after a union petition is filed.

A recent study conducted by the Heritage Group’s labor policy expert James Sherk estimated that the new election rules will dramatically increase the rate of unionization. Sherk cites a Bloomberg Government analysis to observe that a majority of workplace union elections are decided by five or fewer votes. What’s more, “cutting the time between a request for an election and the ballot increases the chances union supporters will prevail,” according to the study. Unions win 87 percent of elections held 11 to 15 days after a request, a rate that falls to 58 percent when the vote takes place after 36 to 40 days, according to the researchers.

The 11 to 15 day timeframe is very close to what the new NLRB rule is expected to achieve. The ambush election rule will trim the time between an election request and the election itself to 10 days or so, a significant drop from the current average of 31 days.

“If a broader set of elections were to occur more quickly,” wrote Bloomberg analysts Jason Arvelo and Ian Hathaway, “the likely outcome would be more organizing drives, a higher success rate for unions and ultimately more union membership.”

Practical Impact for Employers
In the meantime, what is the practical impact of these new rules on employers? To be sure, the new rules will result in employees being more aware of the NLRB and how to file unfair labor practice charges. They will also result in quicker elections in cases with contested unit and eligibility issues. Quicker elections certainly mean less time to communicate with employees during the election period.

Unions often plan organizing drives before they actually request a workplace election, while employers, who may not be aware of the effort, are forced to make their case only during the period between an election request and the actual election. Hence, shortening that period of time is more prohibitive to an employer’s ability to make the case against unionization than a union’s ability to lobby for it. Employees will hear the other side of the story only from management. Employers, not union organizers, will explain that unions often do not achieve their promised wage increases, but they always take up to 2 percent of workers’ wages in dues. Employers will also point out patterns of union corruption and clauses in union constitutions that levy stiff fines against workers who stray from union rules. Employers are free to tell workers what the union organizers do not.

Savvy employers should have strong employee relations policies and programs in place long before a petition. Such programs should establish open communication channels, provide for employee recognition, and implement competitive wages and benefits among other things. Implementing this type of program will not only help avoid a unionization drive in the first instance, but also will help build employee trust and establish efficient lines of communication that could be vital during a shortened pre-election period.

Employers should also consider training managers about permissible and prohibited conduct under the NLRA and conducting their own education programs, advising employees of their rights under the NLRA, and reminding employees of internal complaint procedures available to them.

Conclusion
2012 is already shaping up to be another eventful year at the NLRB. In coming insights we will further comment on the areas discussed here, as well as several other noteworthy trends. These include, among other things, the Board’s continual focus on social media cases and changes to their General Counsel’s willingness to defer to the grievance and arbitration process in some cases. Finally, Chairman Pearce’s stated desire for the Board to become known as “the resource for people with workplace concerns that may have nothing to do with union activities” promises a continuation of the Board’s focus on protected concerted activity cases in the non-union context. As always, we will continue to monitor and analyze these changes and their implications for employers.
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(1) Excluded from coverage under the National Labor Relations Act are public-sector employees, agricultural and domestic workers, independent contractors, workers employed by a parent or spouse, employees of air and rail carriers covered by the Railway Labor Act, and supervisors.

© 2012 Dinsmore & Shohl LLP.