Salary Confidentiality and Employee Handbooks & Policies
thonoway
9 Posts
My organization has a policy outlined in the employee handbook that reads as follows:
"Confidential Employment Information
All information as it relates to the status of employment is confidential and may not be shared with other employees. This includes, but is not limited to salary, bonuses, and other types of compensation. It is a violation of policy to obtain, possess, and/or distribute confidential personnel information.
Disregard or failure to comply could lead to disciplinary action, including termination. Any employee aware of the possession or distribution of such information should notify Human Resources as soon as they become aware of the situation. Withholding such knowledge is also considered a violation of the policy."
I've read many posts on this board stating that this might be illegal, but we had a lawyer review the entire handbook sometime ago and nothing was mentioned about this policy. An employee of ours (non-management) has been discussing salaries, both her own and that of others, and we are considering terminating her. Is this advisable? Should we change the policy? My company is in an 'employment at will' state.
"Confidential Employment Information
All information as it relates to the status of employment is confidential and may not be shared with other employees. This includes, but is not limited to salary, bonuses, and other types of compensation. It is a violation of policy to obtain, possess, and/or distribute confidential personnel information.
Disregard or failure to comply could lead to disciplinary action, including termination. Any employee aware of the possession or distribution of such information should notify Human Resources as soon as they become aware of the situation. Withholding such knowledge is also considered a violation of the policy."
I've read many posts on this board stating that this might be illegal, but we had a lawyer review the entire handbook sometime ago and nothing was mentioned about this policy. An employee of ours (non-management) has been discussing salaries, both her own and that of others, and we are considering terminating her. Is this advisable? Should we change the policy? My company is in an 'employment at will' state.
Comments
Employees have a right to discuss the terms and conditions of employment, including salaries. The thought is that employees have a right to get together and complain about the company. This law applies to your company whether you have a labor union or not.
So I would not fire the employee for it, and I would change the policy. (The only employees who should be disciplined for sharing this type of information would be employees who have the information because of their job [for example payroll clerk] and share the pay of others without consent; that would be a violation of that employee's duty to keep the information related to others confidential). However, an employee can always share their own pay information.
You may want to take that section back to the attorney with a specific question about the labor laws. Although you may not believe it, attorneys are human too, and in a long employment manual can easily miss that issue.
Good Luck!!
Some colleagues maintain that we can terminate her because she shared information about others salaries without their consent. Still others maintain that because we have a policy that violates the Act, because the employee was not a person who had a duty to keep this type of information confidentional (they were not in payroll or HR), and because the employee found the information in an unrestricted area we should not fire the employee (or even discipline her for that matter) and we should eliminate this policy from the handbook.
We probably need to consult with an attorney but I would appreciate any input before doing so.
>information confidentional (they were not in payroll or HR), and
>because the employee found the information in an unrestricted area we
>should not fire the employee (or even discipline her for that matter)
>and we should eliminate this policy from the handbook.
I think what you say above is exactly the guidance an attorney will give you. It sounds like it is right out of the mouth of an NLRB staff attorney. It would be a giant stretch-exercise in hair splitting to try and fire the employee based simply on the facts that the information was not her own and she had no business discussing it. You won't win my friend.
I would at a minimum talk to the employee about her actions and counsel her that if she ever finds confidential personnel information lying around, she is not to share it with others, but should turn it into HR. You could even ask her how she would feel if it happened to her without her consent (for example, if another employee saw her last review, and shared the comments with others). Her supervisor could tell her that she is disappointed in her behavior and expected her to be more professional (a little guilting can be a good thing).
I would not bring up the policy that violate the NLRA, but just talk about general business ethical type conduct. The employer also may want to write her up for the conduct.
So I think you can take a practical approach, that addresses the behavior of the employee, but has little risk to the employer.
Good Luck!
Theresa is an attorney and I think she has given you excellent practical advice. The risks are well outlined for you as is the relevant law (NLRA). If you are hellbent on terminating this employee (it sounds as if 'somebody' is) you would be safer exploring other ways not related to this ticky legal issue of discussing salaries. Her attorney will point out to you in court that it is irrelevant how she came by the information, whether she picked it up in the cafeteria under a table, or gained it through conversation, she has a protected right under the Act if she chooses to mention it in discussions. Termination for violating an illegal policy is shakey at best. At least another month has passed, which would further destroy the credibility of a decision to terminate for that particular offense.
(edit)
As far as trying to guess what the NLRB agent will or won't do and looking to a crystal ball to read how they might pursue it, there is no benefit to that exercise. It will depend on many unknowns, such as: What the NLRB area office has backlogged, who represents her case to the Board, which agent gets it assigned to him/her, the energy level of that person, the ambition of the complainant, the agent's need for another notch (you appear to be one), the blatant violation of your policy as assessed by the agent and his superior, and on and on. If you have already fired her for this violation, cross your fingers. If you have not, don't. These suggestions are from someone who could not sit down for a week after our last NLRB trial. Or was it two weeks? x:-)
(edit)
P.S: I hope your company has replaced the attorney who reviewed your handbook and did not challenge that policy statement.
Does this reason given to the unemployment commission help or hurt a potential case with the NLRB? At an executive's insistance, an e-mail citing the specific policy prohibiting salary discussions (posted earlier) was distributed to the entire company 2 hours after the employee was terminated, seemingly as a threat to anyone who had the 'list' (although this is not the official reason for the 'reminder', one can put two and two together). I think this is especially damaging, but I've heard nothing from the NLRB as of yet.
>you know it, even the 70mph signs are ignored. The newest of NLRB
>Agents can tear a handbook and your credibility apart on the stand if
>you knowingly have illegal policies. Even more savory to them will be
>your admission that you knew they were illegal, had no intention to
>enforce them, and were merely attempting, all the while, to intimidate
>the employee into abiding by them. We'll agree to disagree Pork.
EXACTLY, Don. Pork, how can you so blatantly disregard the law?
Also, it would seem hard to argue that you terminated the employee for one reason when you sent out a 'policy reminder' on a different policy immediately upon terminating the employee. While you can argue the two were disconnected, it is not very persuasive. Has your company ever terminated someone before for violation of confidentiality policies? If not, you'll have a tougher time. I'm sure at some point someone crossed the confidentiality line, if you just disciplined or warned that person but fired this one, it won't add up, at least in the eyes of the Board.
It may not be logical, but who said the NLRB is?
This employee got her hands on information through the error of others; if she was an honorable person,she would have brought it straight to either payroll or HR. However, as with lots of employees, it's like gossip, much too tantalizing to keep to oneself, so she passed it on. This was most the error of the person who left the confidential information unsecured.
I believe this person would have a case for wrongful termination under these facts. Even though it was not "the right thing" for her to do, I can't see where she could be terminated for this.
I was suspicious of some of our folks who have access to payroll passing on information to their buddies which caused issues. I brought them in as a group and advised them that they could discuss their own salaries with God and everybody, but if I found out they were passing information on about other individuals' salaries, I would not hesitate to recommend their immediate termination. They actually thought this was a protected right! I haven't had any complaints since then....but this is another story.
This employee probably wasn't aware of the NLRB rules and will most likely go about their business without filing any claims. If this employee does end up filing a claim, my opinion is that you would face a long uphill battle. Is it really worth it to expend the time and resources to fight it? That's your call. But if this the employee's only infraction, you might want to think about taking them back or otherwise settling. And do yourself a favor and change the handbook!
Remember, free advice is worth the price.
I would at least press that position in the initial written response to the charge or suggest this to your attorney. Don't go it alone with the NLRB. Those guys shuffling that paper and talking to you on the phone are attorneys! Although they refer to themselves as agents and may pretend to be clerical in their responsibilities, they ain't. I don't think they would go for anything less than 'return to the job with back pay'. Unless you really want to pay a bunch to keep her out. Going with your attorney's guidance is the only way to proceed now. The last thing you want to do is go another few steps alone only to have an attorney later tell you that you should have contacted him/her prior to doing that. Good luck. What a Christmas present for you!
If your former employee wants her job back, it is going to be hard to settle without reinstatement -- if the employee has found a job, you could probably settle for backpay, a posting, and rescinding the policy.
Unfortunately, unless you can show that the employee definately knew the information was confidential, you will probably have a hard time. The labor board is hard on employers with these illegal rules. Your attorney (which you need to hire to help you respond), could probably give you some specific case examples.
Here is something all employers need to keep in mind about having these unenforceable policies that violate the NLRA:
If any employee tries to get a union in, the first thing that will happen is that the union will ask that employee to give it a copy of the handbook. The union attorneys will then scoure the handbook for provision like this that violate the law.
Once they find the provision, they can file a charge with the labor board about the violation of the law. They may also encourge a salt (a person the union has planted) to flagrently violate the provision and get fired, so that the salt can file a charge and get reinstated.
This way, the union can kick off their campaign with a WIN against the big, bad employer.
So there is a downside to having the policy, even if you don't plan to enforce it.
Good Luck!
I'll admit, I cleaned that up for public consumption. But the point is, you now have the federal government prosecuting a claim against you. The federal government has inexhaustable resources, and is a bit of a bully. Like when you were little and you asked your parents "why do I have to . . .", and their answer was "Because I said so . . ." The federal government has been known to expect you to comply "Because we are the govenment, and we say so . . ." You didn't like it when your parents did it and you won't like it when the government does it. But you can save a lot of time and money by trying to work out a deal with the big Gorilla, rather than trying to beat it down! Here you already have one strike against you, because you know your policy violated the law.
Remember what Voltaire said:
There were 2 times when I was financially ruined. The first time was when I lost a lawsuit, and the second time was when I won one.
Good Luck!
Thank you for the advice, we will definately be contacting out attorney on this. I don't think the union issues will really play a factor in this, this employee was white collar (as are most of our employees) but was in a staff position, not managerial. Is the fact that the employee is white collar make a difference?
One other thing that the NLRB asked was in regards to the questioning the the employee that was fired as well as the people that were questioned as part of the investigation. We asked these employees if they were sharing salary information, actually we specifically asked if they had 'seen or shared the salary list'. Is this an issue?
Also, this ex-employee has apparently found other work. Is it illegal to contact their new employer and let them know the circumstances under which they left? This would certainly make her think twice about proceeding. I highly doubt she told them the whole story, but our HR group was never contacted for a reference. I also doubt she would want her job back given the circumstances.
My management team would like this to go away quietly, they certainly don't want to do a posting to all employees. Does the NLRB or claimant (charging party I guess) decide on the settlement? I think we could make it go away if it were up to the employee.
There are a lot of factors that can effect the labor board's decision in a case like this. For example, did the employee know that the information was inadvertantly left out, what was the employee's motive in sharing the information, what were the employee's job duties, did other employees complain about their pay being discussed, etc. Your attorney will go over them with you carefully. Supervisors and management personnel are not covered by the NLRA, but an administrative person could be covered. I am sure your attorney will want to go over the facts in detail.
Good Luck!