Labor Board Decisions Regarding Social Media Pose Risks to Employers

Mineola, NY – Over the past four (4) years we have witnessed unprecedented growth in Social Media. Simultaneously, the National Labor Relations Board, which administers the National Labor Relations Act, has aggressively supported the rights of employees under the Act. Social Media litigation and enhanced protection of employee rights under the Act now mandate employers reconsider their policies contained in employee handbooks or elsewhere.

Section 7 of the Act accords employees the right to engage in “concerted activities… mutual aid or protection.” Historically, this protection has been viewed as granting employees the right to strike or withhold services from an employer. However, a much broader right is inherent: individual activity is concerted where employees seek to initiate or induce others to group action or individual employees bring group complaints to the attention of management.
If action is “concerted” and protected (e.g., not violent or obscene), an employee may not be disciplined for such conduct. Nor may an employer maintain or adopt work rules which reasonably tend to chill employees in the exercise of their Section 7 rights to engage in concerted activity.

Commonly, employee handbooks or other free standing policies of an employer address employee off-site and off-hours conduct. Much of the litigation of Social Media policies has arisen in this context. In Costco Wholesale Corp., the Board considered a social media policy, which prohibited electronically posted statements that “damage the company … or damage any persons’ reputation”. Violations of the policy subjected an employee to discipline. The Board found the policy unlawful as employees could reasonably conclude the policy required that they refrain from engaging in protected communications – for example, criticism of the company or its agents.

The Board, in Hispanics Limited of Buffalo, found unlawful an employer’s discharge of employees for off duty postings on Facebook, which postings were negative about, and derogatory of, a fellow employee’s complaints that the discharged employees were not working hard enough. The employee comments were held protected, as the posts discussed job performance and were the start of group action to defend against a co-workers accusation.

Lastly, the Board in Karl Knauz Motors found unlawful a rule which stated no employee should be disrespectful of, or use any language which injures, the image or reputation of the employer. The policy also recited employees were expected to be courteous, polite and friendly to customers and fellow employees. How could such a rule violate the Act? According to the Board, the courtesy rule chilled the employees’ Section 7 rights to make statements objecting to working conditions and to seek the support of others to improve conditions.

The Board’s assessment of Employee Handbooks extends beyond Social Media policies and policies related thereto. For instance, in Quicken Loans an Administrative Law Judge (ALJ) found both a Proprietary/Confidential Information clause and a Non-Disparagement clause unlawful. Addressing the former, the ALJ found the clause to “explicitly” restrict Section 7 rights by restricting employee discussion with others regarding wages and benefits. The ALJ also found the company’s non-disparagement policy (requiring employees to not publicly criticize, ridicule, disparage or defame the company or its products) unlawful as restrictive of employee Section 7 rights.

Similarly, in Flex Frac Logistics, a confidentiality provision which prohibited employees from sharing confidential information outside the organization was deemed overly broad where confidential information included “personnel information and documents”. According to the Board, such a prohibition would prevent employees from sharing information with union representatives, a right protected under Section 7.

The Board in U.S. Direct TV Holdings found a confidentiality provision in a handbook to be an unlawful restraint of an employee’s Section 7 rights. The stricken policy prohibited employee discussion about their jobs or fellow employees with outsiders. Also, employees were not to disclose company information which was not in the public domain. The Board noted that no attempt to distinguish, or exempt, protected communications with third parties such as “union representatives, Board agents or other governmental agencies” was made. Two other provisions were also stricken: one prohibited contact with media without authorization; the other forbade employees from speaking with law enforcement officials without first contacting security. In both those instances the Board noted the employer failed to make clear that the policies would not abridge employee section 7 rights.

Employment “at will” statements are routinely found in employee handbooks and in the receipt of handbook forms signed by employees. Such statements are intended to preclude assertions that a handbook is a contract of employment. In a recent advice memorandum, the associate general counsel of the Board stated “all handbook provisions that restrict the future modification of an employee’s at will status will be reviewed.” Rocha Transportation. Board counsel also noted that a policy which stated an employee’s at-will status could not be changed by any management personnel would be unlawful. The Board’s rationale is simple – unions negotiate collective bargaining agreements and those agreements are not at-will. Therefore, a statement that implies the at-will status of an employee cannot change is unlawful as chilling the rights of employees to unionize.

When employees are disciplined or discharged by a non-union employer one may well expect a charge at the Board if the basis of the action is violation of a company policy regarding any of the following clauses: Social Media, confidentiality, non-disparagement, courtesy, media contact, security reporting and the like. Also, “at-will” clauses may be challenged by unions in their organizing efforts – charges will be filed alleging violation of employee Section 7 rights.
Violation of the Act has consequences. Any policy found unlawful will likely require rescission and the employer may have to post a notice acknowledging a violation. There are also monetary sanctions as an employee discharged pursuant to an unlawful policy would be entitled to reinstatement and back pay.
Because of all of the foregoing scenarios, an employer is best served by reviewing existing policies to ensure compliance with the Board’s aggressive posture. Perhaps the easiest way to avoid a policy being construed as having a chilling effect on Section 7 rights is to follow the oft noted view of the Board: make sure the policy, by example or by clarification, is not restrictive of employee Section 7 rights. In short, employers may revise existing policy language or add language which makes it “reasonably clear” to an employee that their Section 7 rights are excluded from the broad parameters of the rule in question. In what is surely an ironic twist, employers may also consider eliminating the clauses altogether on the theory that by doing so prima facie illegality would be avoided.

Regarding at-will statements, we encourage employers to continue to have them in their handbooks, and receipts for same, but to avoid statements which imply the at-will relationship cannot be altered or which do not identify at least one individual with authority to change the relation or enter an agreement other than at-will.

If you have any questions or would like assistance in assessing your policies, please contact Jonathan D. Farrell or Peter Schneider; co-chairs of the Labor & Employment Law Practice Group at Meltzer Lippe.