Many of my clients have the misperception that they are lawfully permitted to instruct non-supervisory employees not to discuss their pay or benefits with each other. In fact, such instructions have historically run afoul of Section 7 of the National Labor Relations Act, which protects concerted employee conduct regarding terms and conditions of employment, including compensation.
Some employers have questioned whether the Trump National Labor Relations Board gives them more leeway to restrict employee compensation discussions. To be sure, the current Board has taken a relatively restrictive view of employees’ rights and has rolled back many of the rights recognized by previous Boards. However, a recent Advice Memorandum makes clear that even the current Board is likely not prepared to modify the longstanding protections in place for employee discussions of pay.
The Advice Memorandum at issue was released to the public on October 18, 2019 and involved respondent Gallup. In it, the Board’s Associate General Counsel addressed a situation in which an employer had reclassified several exempt employees to non-exempt and reduced their base salaries. One of the employees complained about the change on several occasions to other employees and to management on the ground that it would mean that employees would be paid less than before. The employer told the employee not to complain about not being paid enough. Eventually, management terminated the employee’s employment on the ground that the employee was “not happy” at the company and was talking about pay to other employees.
Applying extensive Board precedent, the Advice Memorandum had little trouble concluding that the complaints involved pay and the pay structure, which is a core component of the employment relationship. The Memorandum then addressed whether the employee had engaged in “concerted” activity, as is necessary to state a violation of Section 7 of the NLRA. The Memorandum stated that even though the employee acted alone in raising complaints with management, he/she had embarked on a “campaign” to enlist other employees’ support and had raised issues that affected them all, and therefore the activity was “concerted.” According to the Advice Memorandum, it did not matter that other employees did not actively join the complaining employee in bringing the complaints to management.
Advice Memoranda are not Board decisions and therefore do not constitute binding Board precedent. However, the Memoranda guide NLRB regional offices and therefore reflect the agency’s enforcement priorities.
The Bottom Line for Employers
Despite an employer-friendly NLRB under the Trump Administration, the rules have not changed regarding restrictions on non-supervisors’ discussions of their own pay. An employer that requires non-supervisory employees to keep their own compensation “confidential,” or not to discuss the employer’s compensation programs, still does so at its own peril.
Employers are still permitted, however, to restrict employees from disclosing other employees’ compensation information without their consent, and to otherwise abide by reasonable confidentiality restrictions as to the pay or other sensitive information of other employees. And employers may continue to restrict supervisors’ and managers’ discussion of their compensation, as these higher-level employees are not protected by Section 7 of the NLRA.