In recent years, the Obama Board has adopted some extreme views on Section 7 rights, which has pushed its jurisdiction into uncharted territories and left non-unionized employers vulnerable to attack. Two of the most notable examples are (1) Murphy Oil U.S.A., Inc. and D.R. Horton, Inc., in which the Board invalidated arbitration agreements with class action waivers and effectively ignored a mountain of legal precedent to the contrary, including the Supreme Court’s repeated affirmations of such agreements and the Board’s own longstanding jurisprudence and (2) Banner Health System, in which the Board deemed routine confidentiality admonishments given in workplace investigations unlawful, brushing aside employer concerns about protecting the integrity of such investigations. These decisions left both unionized and non-unionized employers reeling from the Board’s unprecedented expansion of Section 7 rights.
The Board’s recent decision in Dish Network, LLC is not such a case. Dish Network, LLC merely reinforces established rules that long predate the Obama Board, which is why Acting Chairman Philip Miscimarra, who has consistently objected to the Obama Board’s extraordinary augmentation of Section 7 rights, concurred with the majority. Nevertheless, although its holding is not particularly groundbreaking, Dish Network, LLC does contain some important lessons for employers – ones that would need to be adhered to even under a Trump Board.
The Board Finds That Dish Network Interfered with Employees’ Section 7 Rights
In Dish Network, LLC, the Board found that Dish Network unlawfully interfered with employees’ Section 7 rights by maintaining an overly broad arbitration agreement and instructing an employee to maintain confidentiality and not to discuss his suspension with his co-workers. These findings, however, were not based on the class action waiver theories of Murphy Oil or the investigation rules of Banner Health System. Rather, they dealt with established protections likely to be enforced through a Trump administration.
Arbitration Agreements Must Allow Employees to File NLRB Charges
The arbitration agreement – which broadly applied to “any claim, controversy and/or dispute between [an employee and Dish Network], arising out of and/or in any way related to Employee’s application for employment and/or termination of employment” – was deemed unlawful because “employees would reasonably construe it to prohibit filing Board charges or otherwise accessing the Board’s processes.” Policies that require the arbitration of all disputes (including NLRB charges) relating to an employee’s employment have been considered violations of the Act since 2006, when the Bush-era Board rendered its decision in U-Haul Co. of California, 347 NLRB 375 (2006).
Employees Cannot Be Told to Keep Disciplinary Actions or Complaints Confidential
The Board also found that Dish Network violated the Act when it instructed an employee not to discuss his suspension with his co-workers. The Act protects employees’ rights to discuss their terms and conditions of employment, including their disciplines and complaints, and, absent a legitimate and substantial business justification that outweighs the employee’s Section 7 rights, rules requiring confidentiality about such matters have long been held unlawful by the Board. The Board used a similar reasoning to find that the arbitration agreement’s confidentiality provision independently violated the Act because it prohibited employees from discussing “all arbitration proceedings, including but not limited to hearings, discovery, settlements, and awards.”
Lessons Learned From Dish Network, LLC
Although the Board in Dish Network, LLC merely enforced rules established long before the Obama Board, it does serve as a cautionary tale for employers. First, this case acts as a stark reminder that even large, sophisticated employers can run afoul of established NLRB precedent if they do not diligently review and monitor their policies for compliance with rules established by the Board. This is particularly true for non-unionized employers, who may not be as cognizant of or familiar with the Board’s ever evolving rules. Second, employers should never agree to a stipulated record when they are defending claims before the Board, as Dish Network did in this case. Here, the stipulated record contained no justification for the confidentiality admonishment to the suspended employee, which is an indispensable part of proving the lawfulness of such an order. Dish Network tried to cure this deficiency by proffering a justification in its brief, but the Board did not accept it because “the stipulation of facts [was] silent about the existence of any such concern.”