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NLRB clamps down on internal investigation confidentiality

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in Employment Law,Human Resources

by Frank P. Spada Jr., Esq., Pepper Hamilton LLP

The National Labor Relations Board (NLRB), the federal agency charged with enforcing the National Labor Relations Act (NLRA), has increased its focus on employer/employee communications.

This matters to all employers, whether or not their employees are represented by a union. Section 7 of the NLRA protects the rights of both union and nonunion employees to engage in “concerted activities,” which includes employee discussions about wages, hours or terms and conditions of employment.

Discussing investigations

In Banner Health System (358 NLRB No. 93, 2012), the NLRB found that the employer violated Section 8(a)(1) of the NLRA by instructing employees not to discuss ongoing internal investigations of employee misconduct.

Section 8(a)(1) makes it an unfair labor practice “to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7.” Before the Banner Health decision, employers investigating misconduct (including discrimination, theft or harassment) commonly asked employee witnesses to maintain confidentiality during the investigation.

In the Banner Health case, the employer’s HR consultant simply asked an employee to refrain from discussing the matter with his co-workers while a harassment investigation was ongoing.

The administrative law judge hearing the case for the NLRB actually found that the instruction was for the purpose of “protecting the integrity of the investigation.” Therefore, he found that the employer had a legitimate business reason for giving the confidentiality instruction to the employee.

NLRB: Not good enough

Unfortunately, in a 2-1 decision, the NLRB rejected the employer’s argument (and the judge’s reasoning) that its confidentiality instruction was necessary to protect the integrity of the ongoing investigation. The NLRB determined that the employer’s “generalized concern with protecting the integrity of the investigation is insufficient to outweigh employees’ Section 7 rights.”

Rather, the NLRB stated that, to justify this type of instruction, an employer must show a legitimate business need that outweighs an employee’s Section 7 rights. The NLRB held that it was the employer’s burden “to first determine whether in any given investigation witnesses needed protection, evidence was in danger of being destroyed, testimony was in danger of being fabricated, or there was a need to prevent a cover up.”

What employers must do

In essence, the NLRB is now requiring employers to make sure they can establish that the need for confidentiality is warranted under the facts of the particular investigation before requesting an employee’s confidentiality. That’s difficult because an employer may not know, at the onset of a workplace investigation, where the investigation may lead and whether a lack of confidentiality will somehow taint the investigation going forward.

Although this requirement will certainly make investigations more difficult for employers, it is an obstacle that can be cleared by taking the appropriate steps.

Review your policies and practices regarding internal investigations. Eliminate from the process any component that includes a blanket instruction that complaining employees or other witnesses refrain from communicating about the issue with co-workers.

If you believe that confidentiality is needed to protect the integrity of the investigation (true in most cases), protect yourself by providing the employee witness with a specific, written reason why confidentiality must be maintained as the investigation proceeds. For example, in a sexual harassment investigation, an employer can legitimately maintain that it is vital to protect confidentiality in the workplace, both to learn the truth about the harassment allegation and to protect the reputations of the alleged harasser and the victim.

Lack of understanding

Although this decision reflects the NLRB’s lack of understanding concerning workplace investigations in general—and specifically that confidentiality is crucial to a successful investigation—a savvy employer can avoid running afoul of this new NLRB standard by providing written justification for maintaining confidentiality as part of any witness interview.

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Frank P. Spada Jr. is a partner with Pepper Hamilton LLP. He represents management in all areas of employment law and labor relations. Frank can be reached at spadaf@pepperlaw.com or (609) 951-4150.

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