Why it matters

Continuing the National Labor Relations Board's (NLRB) focus on employer handbook provisions, an Administrative Law Judge (ALJ) for the agency ordered Verizon Wireless to rescind multiple sections from its handbook related to employee communications. Provisions at issue included one section providing that the employer could discipline employees for causing Verizon Wireless "embarrassment," a clause on using internal e-mail for solicitation, and another on the disclosure of nonpublic company information. Three out of the five sections considered by the ALJ were found to be in violation of Section 8(a)(1) of the National Labor Relations Act (NLRA), as the embarrassment provision was "overly broad," and a ban on using e-mail for solicitation could impact the ability of employees to communicate about wages, hours, and other working conditions. The judge ordered the employer to rescind all the unlawful handbook sections and post notice about the action at Verizon Wireless workplaces. In a statement, the employer said it was considering its options, as "[t]here is no claim that Verizon Wireless violated any employee rights," and the case "concerns technical claims about the wording of certain Verizon policies."

Detailed discussion

In 2014, Verizon Wireless promulgated a company-wide Code of Conduct that applied to all of its offices across the country. A slightly altered version was released in 2015, but the 2014 version of the Code of Conduct remains in place at some Verizon facilities.

Five provisions of the Code were challenged in an administrative proceeding with the National Labor Relations Board (NLRB). Administrative Law Judge (ALJ) Mary Miller Cracraft found three of the five to violate Section 8(a)(1) of the National Labor Relations Act (NLRA) by interfering with, restraining, or coercing employees in exercise of their rights guaranteed in Section 7 of the Act.

Section 1.6 of the Code addressed solicitation and fundraising and prohibited "the distribution of non-business literature in work areas at any time" as well as "the use of company resources at any time" including e-mails, fax machines, computers, and telephones, to distribute or solicit.

This provision focused too much on employer property rights and too little on the importance of e-mail as a means of workplace communications, the ALJ said, citing a 2014 decision from the Board in Purple Communications, Inc. No special circumstances were presented to justify such a restriction in order to maintain production and discipline.

According to the decision, Verizon's "rule prohibits both solicitation and distribution." "In Purple Communications, the Board explained that e-mail 'is fundamentally a forum for communication.' The Board found it inappropriate to treat e-mail as 'solicitation' or 'distribution' per se, recognizing that as forum of communication it constituted solicitation, literature or information, distribution or merely communication that is none of those but nevertheless constitutes protected, concerted activity. Thus both the prohibition on solicitation as well as the prohibition of distribution contravene the holding of Purple Communications."

The next Code provision, Section 1.8, covered employee privacy. Verizon Wireless provided that appropriate steps must be taken to protect all personal employee information, including financial information, and workers "should never access, obtain or disclose another employee's personal information" absent legitimate business purposes.

Although employers have a substantial and legitimate interest in maintaining the privacy of certain business information, the "2014 Code of Conduct Employee Privacy rule is broadly worded and, in my view, would be reasonably read to prohibit employees from discussing wages, hours, and terms and conditions of employment or disclosing employee information to a labor organization or for other protected, concerted activity," ALJ Cracraft wrote.

The 2015 Code of Conduct slightly tweaked the employee privacy provision, the ALJ noted, eliminating the reference to financial information. Verizon Wireless argued that when read in context, employees would readily understand that the updated Section 1.8 was designed to protect legitimate employer interest in the confidentiality of private information.

The ALJ agreed, finding that the provision listed "social security numbers, identification numbers, passwords, bank account information and medical information" as examples of confidential employee information. "This information is legitimately protected confidential information," and a reasonable reading of the entire provision in context sends a message to employees not to access, obtain, or disclose the listed data.

Next up: Section 2.1.3 on activities outside of Verizon Wireless. The provision was part of Section 2.1's "Avoiding Conflicts of Interest" heading and dealt with insider trading, cautioning employees that participation in an individual capacity in outside organizations—such as homeowner's associations or a local school board—to disclose their association with the company and remove themselves from voting on a matter that involves the company's interests.

"Read literally and in context, the rule does not tend to chill Section 7 activities," the ALJ wrote. "[T]he language is clearly addressed to the ethics of a business decision," and "the context of the rule clearly indicates that the conflicts of interest it addresses are those created by or related to commercial competition. The rule is not linked to other rules prohibiting participation in outside activities that are detrimental to the employer's image or reputation."

The ALJ rejected the General Counsel's position that the provision violated the NLRA because it banned the disclosure of nonpublic company information. The ban "must be construed as a part of the business ethics policy," she wrote. "After all, the rule has nothing to do with membership in a labor organization and it strains logic to read the rule as requiring that an employee who joins a labor organization is constrained to reveal that he or she is employed with Verizon Wireless. The requirement that employment be revealed without disclosing nonpublic information is clearly linked to discussing or voting on a matter related to Verizon Wireless or its products."

Although Section 3.3's rule on the appropriate use of Verizon Wireless machinery could not be susceptible to mean e-mail systems, the decision found that Section 3.4.1's prohibition on the use of "company systems … to engage in activities that are unlawful, violate company policies or result in Verizon Wireless' liability or embarrassment," did violate the NLRA.

"A reasonable reading of Section 3.4.1 is that employees will be disciplined for using company e-mail to communicate with a group of employees inside the company on behalf of a labor organization or employees engaged in protected, concerted activity if such use will result in Verizon's 'embarrassment,'" ALJ Cracraft wrote. "Not only does such language contravene Purple Communications, it is also overly broad in the use of embarrassment as a cause of discipline in use of e-mail, instant messaging, intranet or internet."

The ALJ ordered Verizon Wireless to rescind the three provisions found to violate Section 8(a) of the NLRA and post appropriate notice for employees.

To read the ALJ's decision in Verizon Wireless, click here.