Board Affirms Reasonable Employer Policies on Confidentiality and Media Contact

By Carissa Davis

Last week, the National Labor Relations Board (“Board”) held that employer policies that prohibit disclosure of confidential and proprietary information, and certain media contact rules are lawful under the National Labor Relations Act (“NLRA”).  LA Specialty Produce Co., 368 NLRB No. 93 (2019).

In Boeing Co., 365 NLRB No 154 (2017), the Board held that facially neutral rules may be invalidated only if an objectively reasonable employee would interpret the rule to interfere with his exercise of §7 protected rights. This decision established a new more forgiving standard for reviewing facially neutral rules and policies. 

Confidentiality: In LA Specialty Produce, a produce distributor had a decades old confidentiality policy mandating employees to protect confidential and proprietary information, including client vendor lists. The Union argued, and the Administrative Law Judge agreed, that the rule prevented employees from disclosing customer and vendor names to their labor organization, and so, chilled protected activity. But the Board reversed, stating that it was unable to perceive how the language, when reasonably read could interfere with protected rights. The Board noted that employees have the right to appeal to third parties, including employer’s vendors and customers, in support of labor disputes, but that this right does not permit employees to divulge information that the employer may lawfully conceal.

Although the rule in question prohibited the disclosure of confidential client and vendor lists, accounting records, production processes, and business operations, it did not go so far as to prohibit employees from speaking to clients and vendors and it did not apply to information such as employee salary and wages. Accordingly, the Board held, as a general rule, confidentiality policies prohibiting employees from disclosing customer and vendor lists are lawful under the Boeing test.

Media Contact: In addition to the confidentiality challenge, the Board considered the company’s media contact rule providing that, when employees are approached for comment by the media, they cannot provide information on behalf of the company- only the President is authorized to comment. Although §7 generally protects employees when speaking to the media, there is no NLRA right permitting employees to speak on behalf of their employer. (See, e.g., Valley Hospital Medical Center, 351 NLRB 1250 (2007)). When reasonably interpreted as required by Boeing, the rule only prohibits employees from responding to media interviews on behalf of their employer, it does not prohibit any and all media contact. Thus, confidentiality rules of the sort pass muster under the Boeing standard.

The slip opinion for LA Specialty Produce Co., is 368 NLRB No. 93.