On July 30, 2012, the National Labor Relations Board (“NLRB”) issued a decision in Banner Estrella Medical Center, reiterating that employers do not have a right to ask employees to keep internal workplace investigations confidential in all cases.  Employers will need to be careful that they have a legitimate business reason for requesting confidentiality that outweighs employees’ rights under the National Labor Relations Act and that such legitimate business reasons are conveyed to the employees. Generalized concerns over the integrity of the investigation will no longer be sufficient. 

The NLRB’s Decision             

In Banner Estrella Medical Center, an employer’s human resources consultant routinely asked employees who filed internal work-related complaints not to discuss their complaints with coworkers while the employer’s resulting investigation was ongoing. An employee who was so advised after submitting an internal complaint about some work directions that he considered unsafe filed an unfair labor practice charge with the NLRB, alleging that the employer had violated the National Labor Relations Act (“NLRA”).

Section 7 of the NLRA gives employees the right to engage in concerted activities with respect to the terms and conditions of employment – that is, employees have a general statutory right to act together with respect to matters relating to their employment, and the NLRA generally prohibits employers from interfering with that right. A previous NLRB decision, Hyundai America Shipping Agency, made clear that prohibitions against employee discussions of ongoing workplace investigations are permissible under the NLRA only when the employer can show it has a legitimate business justification that outweighs the employees’ rights under the NLRA. The NLRB in Banner Estrella rejected the notion that the request that employees keep the investigation confidential was merely a suggestion rather than an enforceable workplace rule and, citing the Hyundai decision, concluded that a generalized concern over the integrity of the investigation was not a sufficient business justification for the rule.

Relying on the Hyundai decision, the NLRB identified four reasons that could justify a confidentiality requirement with respect to a particular workplace investigation. However, the NLRB held that employers may not simply assume that any of the four identified reasons will always be present and outweigh the employees' rights. Instead, it is the employer’s burden to determine on an investigation-by-investigation basis whether (1) witnesses need protection, (2) evidence is in danger of being destroyed, (3) testimony is in danger of being fabricated, or (4) there is a need to prevent a cover up. Because the employer’s blanket approach in Banner Estrella did not satisfy the necessary investigation-specific analysis needed to justify a restriction on employee discussions about the investigation, the NLRB concluded that the employer’s routine practice of asking employees not to discuss ongoing investigations violated the NLRA.

Practical Implications   

In light of the NLRB’s ruling in Banner Estrella, employers should modify any workplace policies and procedures that give employees a blanket instruction to keep all internal investigations confidential. Employees should be asked to keep investigations confidential only when there is a demonstrable basis for believing, under the circumstances of the particular investigation, that:

  • witnesses need protection,
  • evidence needs to be protected from destruction,
  • there is a danger that testimony will otherwise be fabricated, or
  • there is a need to prevent a cover-up.

If an employer does find it has one or more of the enumerated legitimate business reasons for asking an employee to keep an investigation confidential, the employer should make such reason(s) clear to the employee and clarify that the necessity for confidentiality applies only while the investigation is ongoing. Employers should review their personnel policies and employee confidentiality agreements to ensure that they do not unlawfully infringe on employees’ rights to discuss workplace complaints that become the subjects of internal investigations.