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NLRB Orders Reinstatement and Backpay for Employee who was Unlawfully Discharged for Discussing Salary Information at Work


February 27, 2013

Despite the uncertainty surrounding the legitimacy of the current National Labor Relations Board in the wake of the Noel Canning decision, the Board has continued to issue decisions that have serious consequences for employers. The most recent example comes from the Board’s decision in Jones & Carter, Inc., where it upheld an Administrative Law Judge’s determination that a non-union employer violated the National Labor Relations Act when it terminated an employee for discussing salaries with her co-workers.

In Jones & Carter, the employer had a confidentiality policy that prohibited employees from discussing “financial matters concerning either [firm] clients or the firm” with “outsiders or friends.” The employer maintained that this portion of its confidentiality policy prohibited employees from discussing salaries with other employees “unless the employee is discussing his or her own salary with the employee’s supervisor.” The employer terminated an employee after she “harassed” and “badgered” other employees about their salary information. 

The ALJ held that the employee “was terminated because of her protected activity in discussing salary information with [another employee].” In support of her finding, the ALJ noted that the Board has consistently held that an employer violates Section 8(a)(1) of the Act where it disciplines an employee for engaging in protected activity “without regard to the employer’s motive, and without regard to a showing of animus.” The ALJ rejected the employer’s argument that the employee lost protection of the Act by harassing and badgering other employees, finding that the employee’s conversations with other employees, while possibly “wrong and deceptive,” were nonetheless consensual, and that there was no evidence that the employee engaged in egregious, harassing conduct. Finally, the ALJ held that the employer’s confidentiality policy was “overly broad” and violated the Act because it prohibited employees from engaging in protected conduct.

As a remedy, the ALJ ordered the employer to reinstate the employee with backpay. The employee declined reinstatement, and the employer ultimately agreed to pay her backpay, 401(k) contributions, medical expenses, and interest totaling $107,000.

This case presents yet another reason for all employers to review their handbooks and revise any policy that could reasonably be interpreted as interfering with employees’ rights under federal labor law. The case also highlights that employers face significant penalties for violations of the National Labor Relations Act. 

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