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Thursday, 29 November 2012 20:34

Blanket Confidentiality Policies and Practices During Investigations May Be Unlawful

Recently, the National Labor Relations Board ("NLRB") held in two reported decisions that Employers who have blanket rules prohibiting employees from discussing ongoing investigations of any kind, violate Section 8 of the National Labor Relations Act ("NLRA").  Section 8 prohibits an employer from restraining an employee's Section 7 rights, which allow employees to engage in "concerted activities" for their mutual aid and protection.  The rulings apply to both union and non-union employers alike.


In the first of the two recent cases, Hyundai America Shipping Agency, Inc., the employer's human resources personnel maintained a practice of routinely instructing employees not to discuss matters under investigation.  An Administrative Law Judge determined that a blanket prohibition on the discussion of matters under investigation without a personal, case-by-case determination of whether confidentiality is required in any given case violated Section 8 of the NLRA.  The NLRB affirmed that there was a violation of Section 8 by maintaining and enforcing the blanket prohibition on the discussion of matters under investigation.  However, the NLRB did not discuss the ALJ's requirement that the employer must make an individual determination of whether confidentiality is truly required in every case.


In Banner Health System d/b/a Banner Estrella Medical Center, human resources personnel gave an employee a standard instruction that he was not to discuss a matter with his coworkers while the employer's investigation was ongoing.  The instruction was part of the employer's standard interview form, and was routinely given by human resources to all employees.


The Administrative Law Judge upheld the instruction, citing the employer's concern for protecting the integrity of investigations.  However, the NLRB disagreed, finding that a generalized concern of protecting the integrity of investigations did not outweigh the employee's Section 7 rights.


Citing Hyundai, the NLRB held that to minimize the effect on an employee's Section 7 rights, the employer must establish a legitimate business justification by making an express determination, in every case, with respect to any given investigation:


  • A witness needs protection,
  • Evidence is in danger of being destroyed,
  • Testimony is in danger of being fabricated, or
  • There is a need to prevent a cover-up.


The NLRB also said that it did not matter that the instruction was not accompanied with a threat of discipline, as the effect of the instruction had a reasonable tendency to coerce employees.


What Does This Mean for Employers?


These recent decisions signify a dramatic shift in favor of employee rights at the expense of an employer's interest in the integrity of its internal investigations.  In light of these decisions, employers should review and revise current practices to ensure compliance with Hyundai and Banner.  If your investigators or policies currently instruct employees never to discuss an ongoing investigation, an employee could use the instruction as a basis for a Section 8 claim.


For more information about policies and practices, or any labor and employment law question, please contact Attorney Peter Culp or another employment law attorney with the Dempsey Law Firm.

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