On August 14th, the National Labor Relations Board reversed an Administrative Law Judge’s decision dismissing an unfair labor practice against Philips Electronics. The NLRB’s three member panel ruled that Philips’ unwritten rule prohibiting employees from discussing discipline was an impermissible restraint on employee speech. Philips Electronics North America Corporation and Lee Craft, Case 26-CA-085613 (August 14, 2014).
The Philips matter began – like a lot of cases – with an unruly employee. The employee had worked for Philips for several years, during which time he received numerous warnings for inappropriate behavior. Philips eventually gave the employee one last warning, and informed him that if he engaged in further inappropriate behavior he would be fired. Four days later, Philips was notified that the employee engaged in further inappropriate behavior. Of import to readers of this blog is that the employee showed others his disciplinary report and advised other employees why he was disciplined. Not surprisingly, Philips fired the employee.
In its incident report, Philips noted that “employees are aware that disciplinary forms are confidential information and should not be shared ….” Similarly, Philips stated in its discharge notice that the employee is being “terminated effective immediately due to disrupting the operation and sharing confidential documentation ….” While Philips argued that it did not have a written rule prohibiting communications concerning discipline, the Board easily found that it had a de facto rule prohibiting such discussions. Frankly, it is hard to argue against such a finding given the clear written statements adduced at the hearing. Absent a legitimate and substantial justification for such a prohibition, Philips cannot stifle employees from discussing the terms and conditions of employment, including discipline.
Employers should keep in mind a couple of things. First, the NLRB is going to broadly examine any rule prohibiting employees from discussing the terms and conditions of employment, regardless of whether it is a union or non-union shop. Second, an employer’s practices, in addition to its written rules, will be scrutinized. Employers cannot simply point to its company handbook and expect that to end the inquiry. Actions speak louder than words or, in this case, the lack of words.