NLRB Rules that Employer's Request for Confidentiality During Internal Investigation Violated NLRB Section 7
On July 30, the National Labor Relations Board (“NLRB”) issued a 2-1 decision in the case of In re Banner Health System, holding that the employer violated Section 7 of the National Labor Relations Act (“NLRA”) by requiring that participants in internal investigations maintain confidentiality. Section 7 of the NLRA makes it an unfair labor practice for an employer to inhibit employees’ “concerted activity” regarding their working conditions. The NLRB concluded that Banner Health System’s requirement of confidentiality in all internal investigations infringed on employees’ right to discuss their working conditions. Although the NLRB’s ruling does not impose an across-the-board ban on confidentiality during internal investigations, the decision makes clear that the NLRB now places the burden on employers to justify whether witnesses need protection, evidence is in danger of being destroyed, testimony is in danger of being fabricated, or there is a need to prevent a cover up. If an employer cannot demonstrate these factors, then a request for confidentiality during an internal investigation could be deemed an unfair labor practice.
The problem with this is that employers almost never have advance warning of such conduct. And when these issues do arise, it is frequently too late to undo the damage. As a result, requiring that an employer have a justification before requesting that investigation participants maintain confidentiality could significantly hamper the effectiveness of internal investigations. Placing that burden on employers seems particularly unfair given the significant liability employers face for retaliation under Title VII and other anti-discrimination statutes.
This ruling is the latest in a series of head-scratching NLRB opinions and proposed rules. Given the tension between the NLRB’s ruling and employers’ potential retaliation liability, employers will have to think long and hard about how strictly to follow the NLRB’s ruling. That being said, employers would be wise to review their internal investigation policies and procedures to minimize strict reliance on any broad confidentiality mandates.