Mum may not be the word when it comes to employees sharing information about their wages among themselves. A federal appeals court has ruled that an employer committed an unfair labor practice when its confidentiality clause prohibited employees from discussing their wages.
Key: Although the unfair labor practice moniker usually applies to union shops, it also applies to any workplace, union or, in this case, nonunion. (Flex Frac Logistics, LLC v. NLRB, No. 12-60752, 5th Cir., 2014)
Wages under wraps. Under the federal National Labor Relations Act, employees have the right to act collectively in regard to their wages, hours and working conditions. Employees retain those rights, even if they work at a nonunion company.
Employees at a nonunion shop signed a confidentiality agreement, which required them to keep confidential financial information, including costs, prices and personnel information. Employees who disclosed this information could be fired.
An employee who was fired filed an unfair labor practice charge with the National Labor Relations Board (NLRB). The NLRB ruled in the employee’s favor. NLRB: The confidentiality agreement prohibited employees from discussing costs and personnel matters, which includes wages, in contravention of federal. The employer appealed the NLRB’s decision.
It’s chilly in here. On appeal the employer argued that employees wouldn’t reasonably interpret the confidentiality clause as chilling their rights to discuss their wages. The appellate court disagreed and upheld the NLRB’s decision.
Court: What employees actually do isn’t determinative. The appropriate inquiry is whether the rule would reasonably chill employees in the exercise of their rights. Where workplace rules are likely to have a chilling effect, the NLRB may conclude that their maintenance is an unfair labor practice, even absent evidence of enforcement, the appeal’s court concluded.
PAYDAY SHOW-AND-TELL: Employees gather their wage data from their pay statements. Don’t think you can squelch employees’ wage talk by limiting those statements. Most state wage payment laws require pay statements to supply specific information. Click on the image below to bring up a chart that summarizes pay statement disclosure requirements. To save space, states without laws are omitted.