In 2015, we reported to you about the National Labor Relations Board’s (NLRB) decision in the Banner Estrella Medical Center case, which placed significant limits on employers’ ability to request employee confidentiality during workplace investigations. As a reminder, in the Banner case, the NLRB found that Banner Estrella maintained a policy of instructing employees involved in workplace investigations to maintain confidentiality of the investigation. The NLRB further held that this type of blanket policy, or an otherwise universal instruction to employees, to keep workplace investigations confidential, violates Section 7 of the National Labor Relations Act (NLRA), which protects employees’ rights to discuss the terms and conditions of their employment with fellow employees. The NLRB stated that confidentiality instructions during investigations are only valid under the NLRA if, in each particular instance, the instruction is supported by facts showing a legitimate need for confidentiality, established on a case-by-case basis. The NLRB also found that the hospital’s employee confidentiality agreement, which expressly prohibited employees from discussing “private employee information” including information regarding employee pay and disciplinary action, violated Section 7. Following the 2015 decision, Banner Estrella sought review before the United States Circuit Court of Appeals for the District of Columbia, and the NLRB cross-applied for enforcement of its order. The D.C. Circuit issued its decision in this matter on Friday, March 24, 2017.
In two parts, the appeals court separately addressed both aspects of the case – the confidentiality agreement and the investigatory nondisclosure policy. Not surprisingly, the court enforced the NLRB’s finding that the hospital’s confidentiality agreement violated Section 7, stating that the agreement prohibited “the very discussion of terms and conditions of employment that Section 7 protects.”
However, for most employers, the crux of the case was the second issue: whether the court would find that the NLRB’s position on workplace investigation confidentiality was overreaching. Although the D.C. Circuit refused to enforce the NLRB’s finding that Banner violated the NLRA by maintaining a blanket investigatory confidentiality policy, this would-be victory for employers does not have the impact one might hope. That is because the court’s decision not to enforce this portion of the NLRB’s order was based solely on its conclusion that the record evidence in the case was insufficient to support a conclusion that the hospital had applied a blanket confidentiality policy in this case, or that it applied it in every workplace investigation, or even that it had instructed the employee to keep the investigation under scrutiny confidential. In other words, the appellate court did not address the substance of the issue – whether Section 7 prohibits broad confidentiality instructions in workplace investigations – instead deciding the case on somewhat technical grounds. Without guidance by the court otherwise, it can be presumed that at least for the time being (things may change when new NLRB members are appointed by the President), the NLRB will maintain its position that employers may only issue confidentiality instructions in workplace investigations in narrowly defined circumstances. Accordingly, employers may be well served to avoid using blanket practices or policies that all information provided in connection with workplace investigations be maintained in confidence, and to tailor any confidentiality instructions as narrowly as possible, based on the circumstances of each investigation in which they are issued.