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Another One Bites the Dust: NLRB Invalidates Confidentiality Policy

Limiting discussion of trade secrets and other confidential, proprietary information is fine. Wages and other terms and conditions of employment, however, are off limits.

February 11, 2014
Related Topics: Legal Compliance, Wages and Hours, Policies and Procedures, Compensation, Legal
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If I’ve said it once, I’ve said it a thousand times: employers cannot maintain policies that restrict their employees’ ability to talk about how much they earn.

Thus, it shouldn’t surprise to anyone that, in MCPc, Inc. (2/6/14) [pdf], the National Labor Relations Board concluded that the following policy illegally restricted employees’ rights to engage in protected concerted activity:

Dissemination of confidential information within [the company], such as personal or financial information, etc., will subject the responsible employee to disciplinary action or possible termination.

As the NLRB pointed out, the standard isn’t whether the policy actually restricted employees from discussing wages or other terms and conditions of employment with their coworkers, but whether they would reasonably construe the policy to have that effect. Never mind that in MCPc, Inc., the employer fired an employee for discussing with co-workers staffing shortages that resulted from a perception of high executive salaries.

You can draft a confidentiality policy that will not run afoul of protected-concerted-activity rights under the National Labors Relations Act; you just have to draft narrowly. Thus, limiting discussion of trade secrets and other confidential, proprietary information is just fine. Wages and other terms and conditions of employment, however, are off limits, which should be clear from the policy. And, of course, don’t fire an employee for talking about wages or working conditions. I wonder how the NLRB would have even learned about MCPc’s overly broad policy if the company hadn’t fired a worker for violating it?

Jon Hyman is a partner in the Labor & Employment group of Kohrman Jackson & Krantz. Comment below or email editors@workforce.com.  For more information, contact Hyman at (216) 736-7226 or jth@kjk.com. Follow Hyman on Twitter at @jonhyman.

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