NLRB Finds Confidentiality Policy Violates National Labor Relations Act

The National Labor Relations Board recently found a company’s confidentiality policy violated section 7 of the National Labor Relations Act, which permits employees to organize. Cintas Corp. and UNITE, 2005 NLRB LEXIS 309, June 30, 2005. Cintas, with some 27,000 workers, included the following fairly typical statement in its employee handbook: “We honor confidentiality. We recognize and protect the confidentiality of any information concerning the company, its business plans, its partners, new business efforts, customers, accounting and financial matters.” The company uses the term “partners” to mean employees.

The Board found the policy’s unqualified prohibition of the release of any employee information could reasonably be construed by employees as preventing them from discussing their wages, and other terms and conditions of employment with fellow employees and the union. As a result, the language interfered with their right to organize and violated sections 7 and 8(a)(1) of the Act.

It should be noted that there was no finding that the language was promulgated for the purpose of restricting organizing activity, or that the company relied on the policy to discipline employees found discussing their wages or conditions of employment. The mere presence of the language was enough for the Board to find a violation.

Employers should review their confidentiality policies for compliance with the Board’s ruling. While policies aimed at protecting proprietary business information are legal, they cannot preclude employee disclosure of the terms and conditions of their employment. Any such policy must be clear as any ambiguity will be resolved in favor of the employee. Also, organizations should guard against taking disciplinary action against employees who are found to have discussed their pay, benefits or conditions of employment with others.