Firing for Concerted Social Media Posting of Misappropriated Information Okay; Rules on Intellectual Property and Confidentiality of User Information Lawful Under Boeing: NLRB Division of Advice | Practical Law

Firing for Concerted Social Media Posting of Misappropriated Information Okay; Rules on Intellectual Property and Confidentiality of User Information Lawful Under Boeing: NLRB Division of Advice | Practical Law

The Office of the General Counsel of the National Labor Relations Board (NLRB) recently released an advice memorandum finding that an employer's discharge of an employee who during a union organizing campaign posted a photograph of a bonus request form taken from a manager's desk on social media, did not violate Section 8(a)(1) of the National Labor Relations Act (NLRA) because the removal constituted disloyalty outside the NLRA's protection. In a second memorandum, the General Counsel concluded that employer work rules on intellectual property and confidentiality are not unlawfully overbroad in light of the new Boeing analysis.

Firing for Concerted Social Media Posting of Misappropriated Information Okay; Rules on Intellectual Property and Confidentiality of User Information Lawful Under Boeing: NLRB Division of Advice

by Practical Law Labor & Employment
Law stated as of 02 Aug 2023 • USA (National/Federal)
The Office of the General Counsel of the National Labor Relations Board (NLRB) recently released an advice memorandum finding that an employer's discharge of an employee who during a union organizing campaign posted a photograph of a bonus request form taken from a manager's desk on social media, did not violate Section 8(a)(1) of the National Labor Relations Act (NLRA) because the removal constituted disloyalty outside the NLRA's protection. In a second memorandum, the General Counsel concluded that employer work rules on intellectual property and confidentiality are not unlawfully overbroad in light of the new Boeing analysis.
NOTE: See the UPDATE at the end of this resource for subsequent developments affecting these advice memoranda.
On June 11, 2018, the Division of Advice of the NLRB's Office of the General Counsel (Advice) released an advice memorandum, which concluded that an employer's discharge of an employee who, during a union organizing campaign, posted a photograph of a team leader's bonus request form on social media, did not violate Section 8(a)(1) of the NLRA because although the employee was otherwise engaged in protected concerted activity when he posted the form, his conduct was not protected because he knew that the form was improperly removed from a manager's desk and copied. On June 14, 2018, Advice released a second advice memorandum which held that two employer work rules, an "Intellectual Property" policy prohibiting use of the employer's logos without express written approval, and a "Confidentiality" policy prohibiting use of proprietary and confidential information that includes "user information," are not unlawfully overbroad in light of the new Boeing analysis, and therefore do not violate Section 8(a)(1) of the NLRA (see Boeing Co., 365 N.L.R.B. No. 154 (Dec. 14, 2017)).
These advice memoranda are not binding precedent from the NLRB. However, they provide insights concerning:
  • The effect of disloyalty on conduct that would otherwise be concerted activity protected under the NLRA.
  • Whether intellectual property and confidentiality rules contained in the employer's "Terms of Service" agreement, are unlawfully overbroad work rules in light of the NLRB's Boeing analysis.

Kumho Tires

During a union organizing campaign at a tire manufacturer, Kumho Tires, an employee removed a bonus request form from a basket on a team leader's desk. The form had been completed and signed by the team leader, seeking $350 for "non-union support." It was not labeled "confidential." The employee photocopied the form, returned the original, and then showed a co-worker who posted a photograph of the photocopied form on the union's closed, private Facebook group. A supervisor then discharged the employee who posted the form, stating that the Facebook post of the bonus request form violated Kumho's social media policy.
Advice concluded that Kumho did not violate Section 8(a)(1) by discharging the employee. The social media policy provision that Kumho relied on when discharging the employee was facially lawful under Boeing. Although the employee was engaged in concerted activity for mutual aid or protection at the time he posted the photograph to the closed Facebook group, his conduct was not protected because he photographed and disseminated the copied form knowing that it had been taken improperly by his colleague from the team leader's desk.
Specifically, Advice noted that:
  • Under Boeing, if a rule would be reasonably interpreted to interfere with the exercise of NLRA rights, the NLRB must consider not only the rule's potential impact on NLRA rights but must also balance those interests against the employer's legitimate justifications for maintaining the rule. However, if the rule would not reasonably be interpreted as restricting NLRA rights, the rule is lawful and no balancing is necessary. (See Practice Note, Employee Electronic Communications under the National Labor Relations Act: Regulating Employee Communication in Employment Policies; Legal Update, NLRB Establishes New Standard Governing Workplace Policies and Upholds No-Camera Policy.)
  • Kumho's Social Media policy states:
    "Maintain the confidentiality of the Company's trade secrets and private or confidential information. Trade secrets include information regarding the development of systems, processes, products, know-how, and technology. Do not post internal reports, policies, procedures, or other internal business-related confidential communications."
  • This rule would not reasonably be interpreted as restricting NLRA rights under Boeing because the rule:
    • does not explicitly reference information concerning employees or terms and conditions of employment;
    • does not otherwise contain language that would reasonably be construed to prohibit Section 7 communications; and
    • provides examples of "trade secrets" that give context to the limited scope of what would be considered confidential under the rule.
  • The employee was engaged in protected concerted activity concerning wages and the issue of team leader bonus/overtime compensation when he posted the bonus request form because he:
    • posted it during an ongoing organizing campaign;
    • posted it as a response to statements the employer made on its anti-union website;
    • discussed it with a co-worker, and addressed it online with a closed Facebook group of union supporters, including employees, who "liked" and commented on the post; and
    • believed that, contrary to Kumho's claims, it could afford to pay them higher wages. The copy of the bonus request form suggested to the employees that management had funds for extra bonuses and therefore should be able to afford employee raises.
  • The NLRB has held that the disclosure of certain types of information, which may otherwise constitute protected concerted activity, may involve such disloyalty to an employer that the disclosure falls outside the NLRA's protection. For example, the NLRB upheld the discharge of:
  • The NLRB has concluded that an employee who disseminated company information was engaged in unprotected conduct even where he obtained it anonymously from another employee rather than procuring it himself, where he knew that the information was wrongly obtained (Int'l Bus. Machs. Corp., 265 N.L.R.B. 638, 638 & n.4, 641 (1982)).
  • The Kumho employee's conduct was unprotected because:
    • he disseminated a copy of the bonus request form even though he knew that his co-worker had misappropriated the form;
    • the co-worker removed the bonus request form from a basket on the team leader's personal desk, an area that should have allowed the team leader some expectation of privacy;
    • the substance of the form also communicated its private nature to employees: it was a request from the team leader to Kumho about his personal compensation, and not wage data or other general information;
    • the employee took the form, made his own copy, and then publicized that copy (instead of just passing on the information he had seen).
  • Kumho's discharge of the employee was lawful regardless of whether the conduct was properly covered by an employer rule because the conduct was not protected by the NLRA.

Lyft, Inc.

Lyft, Inc. operates a website and app that matches riders seeking transportation with drivers offering transportation in their personal vehicles. A union filed an unfair labor practice charge alleging that Lyft maintained two unlawfully overbroad work rules. An NLRB regional office previously concluded these rules were unlawfully overbroad but submitted the rules to Advice to determine their legality under the new Boeing analysis. Under Boeing, employer rules fall into three categories:
  • Category 1. Rules that the NLRB designates as lawful to maintain, either because:
    • the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of Section 7 rights, and therefore, no balancing of rights and justifications is required; or
    • although the rule has a reasonable tendency to interfere with Section 7 rights, the potential adverse impact on those protected rights is outweighed by employer justification, for example, rules requiring "harmonious relationships," upholding basic standards of "civility," or prohibiting cameras at work.
  • Category 2. Rules that warrant individualized scrutiny in each case as to whether the rule, when reasonably interpreted:
    • would prohibit or interfere with the exercise of Section 7 rights; and
    • if so, whether any adverse impact on protected conduct is outweighed by legitimate business justifications.
  • Category 3. Rules that the NLRB will designate as unlawful to maintain because:
    • they would prohibit or limit Section 7 conduct; and
    • the adverse impact on Section 7 rights is not outweighed by justifications associated with the rule, for example, prohibiting employees from discussing wages and benefits among themselves.
(Boeing, 365 N.L.R.B. No. 154, slip op. at 15.)
Applying Boeing, Advice concluded that the two policies are lawful.

Intellectual Property (Section 11)

Lyft's Terms of Service agreement includes the following rule concerning intellectual property:
"You agree that you will not:
Create any materials that incorporate the Lyft Marks or any derivatives of the Lyft Marks other than as expressly approved by Lyft in writing."
Advice noted that:
  • This policy falls under Category 1 as it is a traditional prohibition on employee use of employer trademarks or logos.
  • Most employee activity covered by this type of rule is unprotected, including use of employer intellectual property:
    • for unprotected personal gain; or
    • to give the impression that employee activities are condoned by the employer.
  • A portion of protected concerted activity may fall under this rule, including fair use of an employer's intellectual property on picket signs and leaflets. However, employees will usually understand this type of rule as protecting the employer's intellectual property from commercial and other non-Section 7 related uses.
  • Even if employees would reasonably interpret this type of rule to apply to fair use of an employer's trademarks or logos as part of protected concerted activity, it is unlikely that the rule would actually cause them to refrain from using them because:
    • the types of protected concerted activity implicated by these rules are generally advanced in terms of employee organization; and
    • employees are unlikely to be deterred from fair use of a logo on a picket sign by a rule in an employee manual.
  • Even if employees were to refrain from such fair use, that would only peripherally affect Section 7 rights. While employees might refrain from using the logo as part of their protected concerted activity, it would not stop the protected concerted activity itself.
  • Employers have a significant financial interest in protecting their intellectual property, including logos, trademarks, and service marks.

Confidentiality (Section 18)

Lyft's Terms of Service agreement also includes the following rule concerning confidentiality:
"You agree not to use any technical, financial, strategic and other proprietary and confidential information relating to Lyft's business, operations and properties, including User information ("Confidential Information") disclosed to you by Lyft for your own use or for any purpose other than as contemplated herein. You shall not disclose or permit disclosure of any Confidential Information to third parties."
Advice noted that:
  • This prohibition on using any proprietary and confidential information relating to Lyft's business, operations, and properties, "including User Information" is facially lawful under Boeing because the employees would not reasonably interpret it to cover Section 7 activity.
  • Rules prohibiting disclosure of customer information and trade or business secrets should be considered Category 1 rules.
  • General prohibitions on posting confidential information should be:
    • considered Category 2 rules where they would reasonably be read to include information about terms and conditions of employment; and
    • found unlawfully overbroad where the impact on Section 7 rights outweighs the employer's legitimate business justification for the rule.
  • Employees would not reasonably interpret this rule to prohibit the sharing of information about working conditions or of employee names and contact information because:
    • the rule is primarily directed at prohibiting the disclosure of "technical, financial, strategic, and other proprietary" information;
    • it does not specifically reference "employee information," but rather covers "User" information," which term refers collectively to both "riders" and "drivers" who are "users" of the Lyft platform; and
    • the drivers regularly use Lyft-created on-line forums to discuss their wages and other working conditions, which suggests that the parties clearly have not interpreted this rule as prohibiting those types of discussions.

UPDATE

On August 2, 2023, a Board majority adopted a new burden-shifting standard for evaluating facial challenges to employer work rules that do not expressly restrict employees' protected concerted activity under Section 7 of the NLRA, overruling Boeing and the subsequent work rules decisions applying the categorical classification system articulated therein (Stericycle, Inc., 372 N.L.R.B. No. 113 (Aug. 2, 2023); for more information on this decision, see Article, The NLRB's New, Developing Standard for Assessing Lawfulness of Work Rules).