Mention the National Labor Relations Act ("NLRA") and many instantly think of unions, strikes, pickets, and protests. However, the NLRA has long been applied to other areas of employment law, especially where the rights of employees to engage in concerted activity are involved. Under Section 7 of the NLRA, employees have the right to engage in concerted activity for the purpose of collective bargaining or other mutual aid or protection; i.e., two or more employees are protected in acting together to improve the terms and conditions of employment, including wages and hours.
A prime example of this is the recent federal decision in NLRB v. Northeastern Land Services, Ltd. (First Circuit (Boston)), where the court enforced a National Labor Relations Board ("NLRB") order holding that a confidentiality provision in an employment agreement prohibiting disclosure of the terms of employment, including compensation, violated the Act by restraining protected, concerted activity. In that case, Dupuy worked for Northeastern, a temporary employment placement agency that paid its employees directly. Dupuy complained frequently to his employer about various late payment and reimbursement disputes he had with Northeastern. Further, while on an assignment with El Paso Energy for Northeastern, he asked El Paso whether he could work for the company through a different placement agency since Northeastern had delayed in paying him. El Paso declined Dupuy's request. When a subsequent reimbursement dispute arose between Dupuy and Northeastern (namely, a reduction in his daily laptop reimbursement fee), Dupuy sent an email to a Northeastern representative and copied his contact at El Paso requesting that El Paso offset the reduction in the reimbursement fee in issue. Soon after Dupuy sent this email, Northeastern terminated him, claiming he violated the confidentiality provision in his employment agreement by sharing details of his compensation with El Paso.
Dupuy filed an unfair labor practice charge against Northeastern claiming that it violated his rights under the NLRA by enforcing an overbroad and unlawful confidentiality clause that discouraged employees from engaging in protected concerted activity. The NLRB agreed, and when the company appealed to the federal court, the court held that the confidentiality provision had a "chilling effect" on the right to engage in concerted activity (i.e. to protest his wages and pay), and enforced the NLRB order.
This decision underscores the importance of considering the NLRB's historically aggressive defense of Section 7 rights when drafting employment agreements and policies, including confidentiality provisions, using caution to ensure such provisions are not drafted too broadly. It is also important to remember these protections apply in both a union and non-union workplace environment.