Confidentiality Policy Violates National Labor Relations Act Part 2

By:  Claudia D. Orr

Continued From Part 1

labor-relations-employment-lawThe Board rejected the company’s arguments that: (1) its policy did not violate the NLRA; (2) Galanter was not engaged in protected concerted activity; and (3) even if he was engaged in protected concerted activity, the company still had the right to discharge Galanter for improperly obtaining and disclosing another employee’s confidential wage information.

According to the Board, the confidentiality policy was overly broad, because employees could reasonably construe the language to prohibit Section 7 activity.  The Board noted that although the company’s policy was facially neutral (insofar as it did not inherently condemn conduct that is protected by Section 7), employees could reasonably interpret the prohibition of disclosing “personal or financial information” as prohibiting protected activities (i.e., restricting their discussion of wages). Thus, the company’s employees may be deterred from engaging in legally protected discussions concerning wages and other terms and conditions of employment with fellow employees or the union.

The Board further found that Galanter was discharged for engaging in protected concerted activity because, inter alia, his comments expressed shared concerns about the staffing shortage, and were raised at a group meeting called by the employer. “[T]he Board has long held that concerted activities include ‘individual employees bringing truly group complaints to the attention of management.’” And, even though Galanter’s complaint about the executive’s compensation had nothing to do with the company’s ability to find and hire engineers, the Board noted that concerted activities are protected even where they are “unnecessary and unwise.”

In conclusion, the Board found that the company had violated the act by maintaining an overly broad confidentiality policy, by discharging Galanter because he engaged in concerted activity and by discharging Galanter because he violated the overly broad confidentiality policy. The company was ordered to reinstate Galanter with back pay and benefits and to post a notice of rights and rescind the overly broad confidentiality policy.

In recent years, the Board has struck many social media policies as being in violation of Section 7 rights, but now it has struck a confidentiality policy. Many, if not most, employee handbooks address the confidentiality of company records. These policies should now be reviewed in light of this decision. If you have any questions about the lawfulness of your policy, contact the author, Claudia D. Orr by email at or call her direct line (313) 983-4863. (April 2014)