Trinity recently was asked if an employer could lawfully issue a policy stating or have employees sign a document saying that they will not discuss their pay with fellow employees.
- The short answer is “NO”.
BASIS FOR ANSWER
Section 7 of the federal National Labor Relations Act (NLRA), which is enforced by the National Labor Relations Board (NLRB), specifically provides that employees (even those not protected by unions) cannot be prohibited from discussing their compensation and other working conditions.
The Act refers to such discussions as “protected concerted activity”.
- “Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all such activities.”
Sec. 7, NLRA
SECTION 7 APPLIES NOT JUST TO EMPLOYEES REPRESENTED BY A UNION, BUT ALSO TO NON-UNION EMPLOYEES.
PROTECTED CONCERTED ACTIVITY
Under the NLRA, employers cannot interfere with, restrain or coerce employees in exercising these rights. Consequently, employers are prohibited from creating policies or rules that prevent or limit employees’ rights to talk about their wages, benefits and working conditions.
Enforced by the National Labor Relations Board (NLRB), this law gives employees the right to act together to try to improve their pay and working conditions, with or without a union. If employees are fired, suspended or otherwise penalized for taking part in protected group activity, the National Labor Relations Board will intervene to restore what was unlawfully taken away.
- These rights were written into the original National Labor Relations Act of 1935. Appellate courts and the U.S. Supreme Court have been upheld in numerous decisions.
Whether or not concerted activity is protected depends on the facts of the case. Typically, the determination will focus on three questions:
- Is the activity concerted?
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Generally, this requires two or more employees acting together to improve wages or working conditions, but the action of a single employee may be considered concerted if he or she involves co-workers before acting, or acts on behalf of others. - Does it seek to benefit other employees?
Will the improvements sought – whether in pay, hours, safety, workload, or other terms of employment – benefit more than just the employee taking action? Or is the action more along the lines of a personal gripe, which is not protected? - How is the activity carried out in a way that causes it to lose protection?
Activity carried out in a reckless or malicious behavior (such as sabotaging equipment, threatening violence, spreading lies about a product or revealing trade secrets) may cause concerted activity to lose its protection.
EMPLOYER ACTION
Since you cannot prohibit employees talking about their compensation, the wisest actions an employer can take are to:
- Have a compensation philosophy statement & communicate it.
• Starting at the time of new employee onboarding/orientation & regularly re-enforcing it to all employees - Ensure your pay is internally equitable in addition to being in line with the market place
• The former involves an objective assessment as to differences in pay between groups & individuals within groups
• The latter entails doing periodic analysis as to what the market place is paying comparable positions - Create an environment in which employees are comfortable to come forward to raise questions
• Including the really tough ones without any concern about negative consequences
For more information, including how trinity’s team of experts can assist you:
- E mail Trinity at info@TrintyHR.net
- Visit our website at www.TrinityHR.net
- Call us at 856.905.1762 or Toll Free at 1.877.228.6310
You have HR questions…Trinity has answers!