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Third Circuit Clarifies When Employees Are Protected By The National Labor Relations Act

The Third Circuit Court of Appeals, which covers Pennsylvania, decided MCPC Inc. v. National Labor Relations Board, Nos. 14-1379, 14-1731 on February 12, 2016. The court addressed when a termination of an employee may violate the National Labor Relations Act (“NLRA”), which protects employees, whether unionized or not, who engage in concerted, protected activity.

In this case, an employee who was an engineer complained during a team-building lunch that the company needed additional engineers, and further stated that several engineers could have been hired for the salary the company was paying to a newly hired executive, specifying the executive’s salary. The company representative who was at the lunch grew concerned as to how the employee had learned of the new executive’s salary, which was kept confidential. The employee was called to a meeting, where he gave several different explanations as to where he had obtained the information. The company investigated further, and discovered that, because of a project the employee was working on, he had been given global access to the computer system, and could have entered a confidential data base to retrieve this information. The employer then fired the employee.

The NLRA protects employees who engage in concerted, protected activity against adverse employment actions. Generally, “concerted” activity requires that more than one person must be involved in the activity. The Third Circuit held, however, that a lone employee may engage in concerted activity, either where he engages in it to induce others to join him, or where the lone employee brings a truly group complaint to the attention of management. If the employee’s activity consists merely of personal gripes, there is no concerted activity. The court held that the touchstone of concerted activity is the intent to induce or effect group action in furtherance of group interests. The court found that the employee here engaged in concerted activity in speaking up about the engineer shortage during a team-building lunch with his peers present.

Under the NLRA, activity is protected as long as it is undertaken for collective bargaining or other mutual aid or protection, and is not unlawful, violent, or in breach of contract. Accordingly, the court found that the employee’s action was also protected activity.

If an employee has engaged in concerted, protected activity and is terminated, the employer must show that the employee would have been terminated regardless of the concerted, protected activity. Here, the employer identified three reasons why the employee was terminated: (1) the employee improperly obtained confidential salary information; (2) the employee improperly disseminated that information; and (3) the employee lied about where he had obtained the information.

The court held that the second reason could not support the termination. The employer had a policy forbidding the dissemination of confidential information. The court held that the policy was overly broad and violated the NLRA. The court noted that, to defend a discharge based on a rule that has a tendency to inhibit protected activity, the employer must show legitimate and substantial business justifications for the rule. The court held that no such showing was made here, and in fact, since the policy easily could be interpreted a prohibiting protected wage discussions, it violated the NLRA on its face, and therefore could not be used to sustain a discharge.

The court held that the other two reasons could constitute legitimate business justifications for the employer’s decision, but remanded the matter back to the National Labor Relations Board (“NLRB”) for further review. The court held that the NLRB had not used the proper framework to determine whether the employer violated the NLRA. Since the employee’s misconduct identified by the employer as the reason for the termination did not occur during the protected activity, the court held that the proper framework required the NLRB’s general counsel first to show that protected conduct was a motivating factor in the employer’s decision. Then the employer must show that the same actions would have taken place even in the absence of the protected conduct.

What Does This Mean For You? Employers need to keep in mind that the NLRA applies to nonunion employers as well as union employers. Employers should ensure that policies, particularly confidentiality policies and email and social media policies, are not worded in a way that violates the NLRA. Employers also should keep in mind that employee complaints, if they are brought by or on behalf of a group of employees and are about workplace conditions, are protected by the NLRA, and that employees should not be terminated for such activity.

If you have any questions about this or any other employment or labor law issue, please contact Whitney Rahman at (717) 509-7237 or swr@blakingerthomas.com.

**This update is provided for informational purposes only and should not be
construed as legal advice or as creating an attorney-client relationship
where one
does not already exist, or as lobbying of any sort for or against any
National Labor Relations Board rules or decisions.**