Many employers have rules or policies directing employees who are involved in a workplace investigation to keep their conversations with investigators confidential and to refrain from discussing the matter with colleagues while the investigation is ongoing.  Five months ago, in a decision that left many human resources professionals and employment lawyers scratching their heads, the National Labor Relations Board (NLRB) held that this common practice is unlawful.  The Board made clear that employers can require confidentiality only in limited circumstances, but exactly what those circumstances might be was left unclear, and subsequent NLRB decisions have made things even murkier.

Background

In Banner Estrella Medical Center, 362 NLRB No. 137 (June 26, 2015) – a decision binding upon non-union employers as well as employers with unionized workforces – the NLRB held that a blanket policy requiring confidentiality from employees who participate in a workplace investigation is unlawful.  The Board reaffirmed prior cases finding that directing employees not to discuss matters under internal investigation interferes with their right under Section 7 of the National Labor Relations Act (NLRA) to discuss discipline or disciplinary investigations involving fellow employees (a form of protected concerted activity under the NLRA), and such interference is permissible only upon a case-by-case demonstration that the employer’s interest in confidentiality outweighs the employees’ Section 7 rights.  Thus, a rule requiring confidentiality in all internal investigations – or all investigations “of a particular type” – even if based on an employer’s general intent to protect the integrity of its internal investigations, does not satisfy this standard. For any given investigation, the Board held, employee confidentiality may be required (or “requested,” which the Board viewed as equivalent to a requirement) only if the employer has “objectively reasonable grounds for believing that the integrity of the investigation will be compromised without confidentiality.”

Examples of what might constitute “objectively reasonable grounds” for requiring confidentiality included situations where “witnesses need protection, evidence is in danger of being destroyed, testimony is in danger of being fabricated, and there is a need to prevent a cover up.”  

Notably, the Board stated that this list was not exhaustive and “there may be other comparably serious threats to the integrity of an employer investigation that would be sufficient to justify a confidentiality requirement.”  Although no examples were provided, the Board did note that it could be a consideration in other cases if a request for confidentiality is “necessary to satisfy another statutory mandate,” but the Board did not explain the nature or type of statutory mandate that might suffice.

More Recent Decisions

Banner Estrella left open a host of questions regarding the showing an employer must make to justify requiring confidentiality in an internal investigation.  For example:  

• What kind(s) of harms would a witness need to be protected from – physical danger?  Reputational harm?  Retaliation by a supervisor?  Harassment by coworkers?    
• Would the risk of witnesses tainting each other’s recollections of an event, even without any intent to fabricate testimony, be a sufficient basis for requiring confidentiality?  
• What grounds must an employer have to fear destruction of evidence in order to require confidentiality – a reasonable belief that destruction is more likely to occur than not?  A “reasonable certainty”?  “Probable cause”? “Reasonable suspicion”?  
• How should an employer determine whether there are objectively reasonable grounds for believing it “needs to prevent a cover up”?  Must the employer wait until there are signs that a cover up is occurring?  But wouldn’t that be too late to prevent the investigation from being compromised?  

Unfortunately, in the months since Banner Estrella was issued, subsequent decisions from the NLRB have not only failed to shed any light on these questions, they have actually added to the uncertainty.

One such case was an Administrative Law Judge’s decision involving a complaint by a T-Mobile customer service representative to human resources about sexual harassment by her coach.  T-Mobile USA, Inc., 01-CA-142030, JD(NY)-34-15 (August 3, 2015).  After the employee described the alleged sexual harassment, the HR partner asked her to fill out an incident report and provided her with a standard company notice stating that employees participating in an internal company investigation could face discipline, including termination, for failing to maintain confidentiality about the matter under investigation.  The relevant issue before the ALJ was whether the confidentiality requirement violated the NLRA.

The ALJ held that T-Mobile did not meet its burden under Banner Estrella to justify its confidentiality requirement.  In reaching that conclusion, the ALJ compared the facts before him to the situation in Caesar’s Palace, 336 NLRB 271 (2001), “which was an investigation of alleged drug sales on the employer’s premises, stolen property and threats on the lives of fellow employees,” and where the employer’s confidentiality requirement was upheld.  In contrast to Caesar’s Palace, “the investigation herein related to sexual harassment that, while serious, comes nowhere near the seriousness and possible danger inherent in” the Caesar’s Palace investigation.  The ALJ did not elaborate any further, but these statements indicate that his analysis turned largely (if not entirely) on the relative “seriousness” of the matter being investigated.  This suggests that the criminal activity and threat of violence at play in Caesar’s Palace may establish a standard for the level of “seriousness” necessary to justify a confidentiality requirement, which raises even more questions for employers:  

• Does this mean that confidentiality can never be required for an internal investigation that does not rise to the level of “seriousness” of the Caesar’s Palace drug investigation?  
• If there are “objectively reasonable grounds” for concern about workplace (non-violent) retaliation against a complainant or a witness, even if the underlying complaint concerns a “non-serious” matter, could the employer require confidentiality in those circumstances?  
• Is sexual harassment a per se “unserious” matter for these purposes?  

A few weeks after T-Mobile, the NLRB clouded the waters even more by seemingly narrowing its holding in Banner Estrella without explicitly acknowledging that it was doing so.  The issue in The Boeing Co., 362 NLRB No. 195 (August 27, 2015) was Boeing’s policy, set forth in a standard confidentiality notice that was provided to all employees involved in human resources investigations, which directed employees to refrain from discussing the investigation with coworkers.  Boeing argued that the policy was necessary to protect victims, witnesses, and employees under investigation from retaliation or harassment, and to prevent the spread of unfounded rumors.  The Board rejected that argument using language that seems to have converted Banner Estrella’s non-exhaustive list of circumstances in which a confidentiality requirement would be justified into an exhaustive list.  Specifically, the Board stated that in order to impose a confidentiality requirement:

it must be shown that witnesses need protection, evidence is in danger of being destroyed, testimony is in danger of being fabricated, and there is a need to prevent a cover up.  Only if the Respondent determines that such a corruption of its investigation would likely occur without confidentiality is the Respondent then free to prohibit its employees from discussing these matters among themselves.  

Thus, in Boeing, the Board omitted the caveat from Banner Estrella regarding the possibility of additional permissible justifications for requiring confidentiality.  The Board also left out any reference to the possibility of a “statutory mandate” justifying confidentiality that was expressly noted in Banner Estrella.  This is potentially significant because Boeing had argued that its confidentiality policy was designed not only to protect the integrity of investigations but also to prevent retaliation against employees who complain about EEO violations or participate in HR investigations or EEO complaints – i.e., to implement the anti-retaliation mandates of federal, state and local employment discrimination statutes.  After Boeing, employers are left to wonder if Banner Estrella’s list of grounds for requiring confidentiality is exhaustive or if there still may be other permissible grounds, and whether Boeing effectively rejected prevention of retaliation as a “statutory mandate” justifying a confidentiality requirement.  

What is an employer to do?

These decisions create far more questions than they answer.  While the Board has been clear that blanket confidentiality policies are problematic, the call for an individualized analysis before every internal investigation may not be feasible for many employers who reasonably need some guidelines for the kinds of risks and threats (short of direct threats of violence and risk of a cover up present in Caesar’s Palace) that will be found to justify a confidentiality requirement.  Until the Board provides more guidance, an employer should at least do the following:

• Make a preliminary assessment at the outset of each internal investigation of any potential grounds for requiring (or requesting) employee confidentiality.  
• Identify any real, tangible risks of compromising the investigation – e.g., because certain employees work closely together and are likely to coordinate their stories, or because one participating employee is likely to be intimidated by another, etc.
• If those risks provide grounds for requiring confidentiality, document those grounds – but recognize that the documentation may eventually need to be disclosed as a defense to a charge, so be wary of privilege issues.
• Prepare a confidentiality notice for participating employees that is tailored to the particular circumstances of that internal investigation.  

This complex undertaking needs to be done promptly and expeditiously – and it needs to be done correctly, to minimize the risk an unfair labor practice charge down the line.  Consulting with counsel from the outset would be advisable.  We are monitoring this area and will be sure to let you know of any further developments.