By: Howard M. Wexler and Joshua D. Seidman

Water cooler talk, i.e. office gossip, has been a seemingly timeless thorn in many employers’ sides, particularly because of the decrease in worker productivity that such gossip can cause. As such, some employers–with Section 7 rights being the furthest thing from their mind–have tried to limit such non-productive time by adopting policies aimed at curbing such behavior. Expanding on the recent line of cases that have challenged various employee handbook policies (e.g. confidentiality, social media), an NLRB Administrative Law Judge recently held that a for-profit technical school’s “No Gossip Policy” violated the NLRA. The ALJ also held that an employee’s termination under the policy violated the Act.

The Decision

In Laurus Technical Institute, a technical school implemented a “No Gossip Policy” (“Policy”) in February 2012. In relevant part, the Policy stated that “[e]mployees that participate in or instigate gossip about the company, an employee, or customer will receive disciplinary action…[that] may include termination.”

Additionally, the Policy listed six instances to help define “gossip,” including “[t]alking about a person’s personal life when they are not present,” “[t]alking about a person’s professional life without his/her supervisor present,” and “[c]reating, sharing, or repeating” rumors about another person, that are overheard, or that constitute hearsay. The Policy was published in multiple versions of the school’s employee handbook.

Nine months after the school introduced the Policy, it terminated an employee for “Unsatisfactory Performance.” In the employee’s termination letter the school noted that there were several reasons for her termination, including “multiple complaints about repeated violations of ‘the company’s written ‘no gossip policy,’ as outlined in the company’s handbook,’ which had ‘a direct and negative impact on [her] coworker’s ability to effectively perform their job responsibilities,’” and “attempts to actively solicit and recruit coworkers to work for another company, a direct competitor.”

The ALJ concluded that the school’s Policy violated Section 8(a)(1) of the Act. The decision explained that because “[t]he language in the no gossip policy is overly broad, ambiguous, and severely restricts employees from discussing or complaining about any terms and conditions of employment,” the Policy prohibits employees from exercising their rights under the Act. Similarly, the ALJ noted that the school’s Policy further chills employees’ protected rights because it “narrowly prohibits virtually all communications about anyone, including the company or its managers.”

The ALJ then dissected the employer’s actions with respect to the terminated employee. First, the decision stated that the termination was unlawful because “Board precedent holds that discharging an employee for violating an unlawful overbroad rule is likewise unlawful.” While the school argued that the employee “did not engage in any such protected activity, but if she did, she is not afforded the protection of the [NLRA] because of her disruptive behavior and its effects on her coworkers,” the ALJ rejected this argument and found that the employee was merely discussing recent layoffs of their former co-workers and supervisor and that such discussions constitute protected concerted activity.

Implications For Employers

This decision highlights that employers must continue to tread lightly given the NLRB’s ever increasing fixation with workplace rules that it contends are unlawfully restricting employees’ Section 7 rights. Unfortunately for employers, the Board continues to provide little guidance on how it will rule in future cases involving similar policies. As we have previously discussed, certain employment policies cross clearly established lines and interfere with Section 7 rights. As the case law continues to develop, employers concerned about potential legal challenges might want to revisit their handbooks and explore the possibility of revising those policies that may be problematic in light of these recent decisions.