NLRB Approves Rule Requiring Confidentiality During Open Internal Investigations

In the case of Apogee Retail LLC d/b/a Unique Thrift Store, the National Labor Relations Board (NLRB or Board) recently held that rules requiring confidentiality during the pendency of ongoing internal investigations are lawful, “Category 1” rules under the Board’s decision in Boeing as long as the restriction lasts only during the investigation. If the rule requires confidentiality beyond the duration of the investigation, it is a Category 2 rule that may be lawful if the employer can prove legitimate justification for requiring extended confidentiality and such justification outweighs the effect of requiring post-investigation confidentiality on employees’ exercise of their rights under Section 7 of the National Labor Relations Act.

In reaching this decision, the Board overturned the 2015 decision in Banner Estrella Medical Center, which demanded a case-by-case determination of whether confidentiality can be required in a specific investigation. The Board explained that Banner placed an unduly onerous burden of proof upon employers, failed to consider the importance of confidentiality assurances to both employers and employees during an ongoing investigation, and was inconsistent with the recommendations of the Equal Employment Opportunity Commission to maintain confidentiality during investigations.

In reestablishing an employer’s right to require confidentiality during an ongoing investigation, the Board was careful, however, to explain that such rules should be limited to participants in the investigation and to what is said, learned and/or provided during the investigation. The Board explained that a confidentiality rule should not prevent employees (participants and nonparticipants) from discussing the event(s) giving rise to the investigation because employees “have a Section 7 right to discuss their own or their fellow employees’ discipline, or incidents that may lead to discipline.”

The Board explained that employers may be justified in requiring confidentiality post-investigation in some circumstances, such as where there is a “reasonable belief that the ability of an investigative target to identify an informant may pose a threat to the safety of the informant and/or his or her family or to the security of his or her property.” These rules will be subject to more scrutiny by the Board under the Boeing standard.

This decision is another important win for employers. It allows human resource professionals to enforce reasonable confidentiality rules during the course of workplace investigations and better maintain the integrity of those investigations.

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