Labor Board rules on electronic postings that damage a company

National Labor Relations Board Finds Rule Prohibiting Electronic Posting of Damaging Statements Illegal
By Nelson Atkin
Barran Liebman
Oregon Law Firm

National Labor Relations Board Finds Rule Prohibiting Electronic Posting of Damaging Statements Illegal

In a continuing series of decisions attempting to expand employee’s labor rights, the National Labor Relations Board (“NLRB”) recently found Costco Wholesale Corporation violated the National Labor Relations Act (the “Act”) by maintaining a rule prohibiting employees from electronically posting statements that “damage that Company…or damage any person’s reputation” (Costco Wholesale Corporation, 358 NLRB No. 106, September 7, 2012). The NLRB stated that the appropriate inquiry in determining whether the maintenance of the rule violated Section 8(a)(1) of the Act, is whether the rule would reasonably tend to “chill” employees in the exercise of their Section 7 rights to engage in “protected concerted activity.” If a rule explicitly restricts Section 7 rights, it is unlawful. If it does not, such as the rule under review,

[t]he violation is dependent upon a showing of one of the following: (1) employees would reasonably construe the language to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7 rights

According to the NLRB, the rule’s broad prohibition against making statements that “damage the Company, defame any individual or damage any person’s reputation” clearly encompassed concerted communications protesting the Company’s treatment of its employees.

Based on this analysis, the NLRB held that “employees would reasonably conclude that the rule requires them to refrain from engaging in certain protected communications (i.e. those that are critical of the Respondent or its agents).” Distinguishing earlier decisions relied on by the ALJ, the NLRB stated, “Most involved rules addressing conduct that is reasonably associated with actions that fall outside the Act’s protection, such as conduct that is malicious, abusive, or unlawful (e.g. “verbal abuse”, “harassment”, or “conduct which is injurious, offensive, threatening, intimidating, coercing, or interfering with other employees”). According to the NLRB, those decisions using the same analysis used in this case would not result in employees reasonably concluding that Section 7 activity was prohibited, because the rule must be considered in context.

Based on this decision, Employers should carefully review all rules which limit employee communications. Rules should focus on communications which constitute offensive and illegal conduct.

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