Provided by: Judge Ruth B. Kraft

The NLRB ruled in September that Quicken Loan’s confidentiality rule was invalid. The rule prohibited employees from disclosing non-public information relating to the employer’s personnel, including “all personnel files, rosters, personal information of co-workers, managers, executives and officers; handbooks, personnel files, personnel information such as home phone numbers, cell phone numbers, addresses and email addresses” to any person, business or entity.

Frankly, do you see anything wrong with that? Whenever there is a security breach on Facebook, Google, etc., it makes the nightly news and the front page of the newspapers. So, what could be the problem? The answer is Section 7 of the National Labor Relations Act. The NLRB, in upholding a decision of an administrative law judge, held that the confidentiality restrictions would “substantially hinder employees in the exercise of their Section 7 rights” to collective action. In plain English, all that contact information would be highly beneficial in unionization or to a class action lawsuit. The NLRB is seemingly oblivious to the implications. A worker could just as easily provide that data to an Amway distributor or Mary Kay consultant, sell it to a data mining company, or use personal information to commit identity theft!

Unless and until the Supreme Court decides to the contrary, I will continue to write confidentiality clauses prohibiting disclosure but couching them with the caveat that nothing shall interfere with employees’ rights to collective action under the National Labor Relations Act.

The NLRB also affirmed the administrative law judge’s invalidation of Quicken’s non-disparagement policy. If you don’t have one of these policies, you need it, particularly given the dangers to employers’ reputations that can be caused by a disgruntled employee posting salacious or defamatory content on Facebook, Twitter and other social media. The NLRB founds that an employee could reasonably (!) interpret the non-disparagement policy as restricting his rights to protected concerted activities. Again, I respectfully disagree. These policies are extremely important. I believe that the policy can be upheld so long as it contains that caveat.

However, the NLRB’s actions are a good indicator of how the current administration perceives employers’ attempts to insulate themselves from threats to their integrity as well as efforts to protect their workers’ confidential information. Based on this, employers are at risk if they attempt to go it alone and write their own employee handbooks without verifying with counsel that they can pass muster.

Review of your existing documentation is a cost-effective way to insure that your rules are in compliance with the law as it is being interpreted.

Have a question or comment?
Contact Jennifer at or at (516) 747-6700 x. 302.