Labor & Employment Law Daily NLRB says Uber directive that employees not comment on ongoing class action violated NLRA, but employee litigation hold OK
Thursday, December 20, 2018

NLRB says Uber directive that employees not comment on ongoing class action violated NLRA, but employee litigation hold OK

By Pamela Wolf, J.D.

On December 17, the National Labor Relations Board released a Division of Advice Memorandum finding that Uber’s instruction that employees not comment about an ongoing employee class-action lawsuit, and that they contact in-house counsel if anyone contacted them about the case, was an unlawful directive to refrain from engaging in Section 7 activity. However, an internal litigation hold issued to employees informing them to preserve all communications with or about the plaintiff, a fellow employee, in the class-action lawsuit was not unlawful.

No-discussion directive. In an October 2, 2018, memorandum, the Division of Advice noted that Uber’s instruction prevented employees from discussing the lawsuit or the common grievance from which it arose with one another, or with media or third parties. Even though Uber’s handbook stated that employees were not restricted from discussing compensation, they would reasonably infer that Uber’s repeated directive prohibiting discussion of the lawsuit or its underlying grievance superseded the handbook. The right of employees to communicate with one another and with third parties and the media about grievances and potential remedies to those grievances, including lawsuits, is a significant Section 7 interest. This was especially true in the context of a class-action lawsuit, where plaintiffs or plaintiffs’ attorneys might try to contact members of the class.

Personal speech limited. Although Uber did have a significant interest in limiting who speaks on its behalf about a lawsuit, this directive went much further. “Instead of merely informing employees that they were not authorized to speak for the company about the lawsuit, the directive covers even the employees’ personal speech,” according to the memo. “The Employer’s business interests could be protected with a much more narrowly drawn proscription that would not silence employees altogether.” Thus, the region should issue a complaint that Uber’s directive violated Section 8(a)(1), the Division concluded.

Litigation hold. However, the litigation hold was lawful under Boeing. It did not explicitly address protected concerted activity, but rather “all communications” with or about the plaintiff/employee, the memo noted. It was therefore tantamount to a facially neutral rule and a Boeing analysis was appropriate.

While employees would reasonably understand the hold to include protected concerted communications with or about the plaintiff/employee, and thus there was the potential that the hold would cause some chilling of protected communications, the hold did not require employees to produce the communications, but merely to preserve them for possible production. This significantly lessened the potential of the hold to chill employees from engaging in protected communications.

Erring on the side of caution. Uber also had significant legitimate interests in imposing the litigation hold. Like all parties to a lawsuit, it was legally compelled to preserve evidence, and adherence to that duty is key to avoiding liability and damages for spoliation of evidence. Although the Division found no cases specifically holding that an employer must produce the private communications of employees, this area of law is far from settled. It was appropriate for Uber to err on the side of caution in complying with its legal obligation to preserve all documents that might amount to evidence in the ongoing litigation.

Judicial system functioning. Further, broad litigation holds serve not just employers’ interest in avoiding penalization for spoliation of evidence, but also the interests of plaintiffs, intervenors, and the courts. “The court system is reliant on parties preventing spoliation of evidence in their possession, and encourages liberal litigation holds,” the memo states. “If employers must consider potential effects on Section 7 rights in imposing litigation holds, they may not comply as fully with their duty to the court, which in turn could interfere with the effective functioning of the judicial system.”

The Division found that in this case, the broad litigation hold was both not unreasonable and not focused on employee protected concerted activity. There also was no evidence that the hold actually had chilled any employee speech. Accordingly, any impact on Section 7 rights was outweighed by the important employer and public interests at stake. Thus, absent withdrawal, the region should dismiss this allegation.

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