In recently finding that the social media policy of Costco Wholesale Corp. violated federal labor law, the National Labor Relations Board took its scrutiny of such employer policies to the next level: This the first time that the full board has ruled on the issue. And the NLRB decision was merely based upon what the Costco policy said — no evidence was presented that the company actually used the unlawful language against any employee. The case is Costco Wholesale Corporation and United Food and Commercial Workers Union, Local 371, 358 NLRB No. 106 (Sept. 7, 2012).
Background
The NLRB enforces the National Labor Relations Act, which is designed to “protect employees’ rights to engage in collective action — to organize themselves and to engage in “collective bargaining … for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.” Section 7 of the NLRA protects the right of employees to discuss wages, hours, terms and conditions of employment with each other, or non-employee union representatives, on their own time and using their own resources. This right extends to making critical statements about working conditions, including about supervisors.
Furthermore, it is a violation of NLRA Section 8(a)(1) to maintain work rules or policies that too broadly restrict these protected discussions.
Facts of the Case
The NLRB complaint against Costco resulted when several employees at Costco’s Milford, Conn. location allegedly were interrogated by management about attempts to form a union. The NLRB then began an investigation that focused on several Costco employee handbook policies, including Section 11.9, the “Electronic Communications and Technology Policy,” which in pertinent part said:
Employees should be aware that statements posted electronically (such as [to]online message boards or discussion groups) that damage the Company, defame any individual or damage any person’s reputation, or violate the policies outlined in the Costco Employee Agreement, may be subject to discipline, up to and including termination of employment.
In an August 2010 ruling, an administrative law judge ruled against Costco for one NLRA claim and dismissed two claims, including one involving Section 11.9. In dismissing those claims, the judge found that the employees would not reasonably construe the rule as regulating and inhibiting Section 7 conduct. Instead, the judge concluded employees would reasonably infer that Costco’s purpose in promulgating the rule was to ensure a “civil and decent workplace.”
However, the full board reversed the judge’s decision on Section 11.9, noting that appropriate inquiry was whether the rule would reasonably tend to chill employees in the exercise of their Section 7 rights. Here, the board determined that:
The broad prohibition against making statements that “damage the Company, defame any individual or damage any person’s reputation” clearly encompasses concerted communications protesting the Respondent’s treatment of its employees. Indeed, there is nothing in the rule that even arguably suggests that protected communications are excluded from the broad parameters of the rule. In these circumstances, employees would reasonably conclude that the rule requires them to refrain from engaging in certain protected communications (i.e., those that are critical of the Respondent or its agents.
Accordingly, the NRLB issued an order under which Costco is to cease and desist using the unlawful policy language, and take corrective measures, such as posting notices about the violation and providing revised language.
For more details on the changing legal landscape involving social media and human resources, see our Social Media and HR Focus and Think Before You Click: Strategies for Managing Social Media in the Workplace, both in hrcomplianceexpert.com.
HR expert Allison West will discuss how to manage legal risks in drafting social media policies — and will take questions — during a ThompsonInteractive Nov. 8 webinar.