On July 30, 2012, by a 2-1 vote, the National Labor Relations Board (NLRB or Board) held that a hospital unlawfully interfered with employee rights under the National Labor Relations Act (NLRA) by asking employees not to talk to coworkers about internal complaints that were being investigated by the hospital. Banner Health System d/b/a Banner Estrella Medical Center, 358 N.L.R.B. No. 93 (July 30, 2012).

According to the facts found by the administrative law judge, the hospital’s human resources consultant routinely asked employees making a complaint of employee misconduct not to discuss the matter with their coworkers while the hospital's investigation was ongoing.

Section 7 of the NLRA gives union and non-union employees the right to engage in “protected concerted activity.” Such activity occurs when two or more employees act together to discuss and/or improve their terms and conditions of employment or when one employee raises such issues on behalf of others. According to the NLRB, to justify a prohibition on employee discussion of ongoing investigations, an employer must show that it has a legitimate business justification that outweighs employees' Section 7 rights.

In this case, the judge found that the hospital's prohibition was justified by its concern with protecting the integrity of its investigations. Contrary to the judge, the NLRB found that the hospital's generalized concern with protecting the integrity of its investigations was insufficient to outweigh employees' Section 7 rights. Rather, in order to minimize the impact on Section 7 rights, it was the hospital's burden "to first determine whether in any give(n) investigation witnesses need(ed) 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." According to the Board, the hospital's blanket approach “clearly failed to meet those requirements.”

In his dissent, Member Brian Hayes reasoned that to violate the Act, an employer's work rule must be an actual work rule with binding effect on employees. In this case, he claimed the hospital did not promulgate any rule at all. “It merely suggested that employees not discuss matters under investigation.” In his view, a suggestion is not a rule or a threat.

Conclusion

Taken to its extreme, the holding in Banner could have some serious implications for workplace investigations. For example, many employers routinely request witnesses in sexual harassment investigations to maintain confidentiality during the investigation. This case suggests that a generalized rule on confidentiality could violate the NLRA. Instead, an employer must be able to show under the circumstances of a particular investigation that it has a legitimate business justification that outweighs employees’ Section 7 rights.

It should be noted, however, that even if an employer’s rule on confidentiality during investigations technically violates the NLRA, there is no financial exposure unless an employee gets terminated or otherwise loses pay for violating the rule. If no employee experiences a loss in pay, the most likely remedy is simply an order requiring the employer to abandon the rule.

If you have any questions about the Banner case, please contact the author or any other attorney in the Arent Fox Labor & Employment practice.