NLRB Overturns Longstanding Precedent Protecting Witness Statements From Disclosure

January 22, 2013

By: Tyler T. Hendry

For nearly 35 years, employers in pre-arbitration discovery with a union have not been required to disclose witness statements obtained during internal workplace investigations.  However, consistent with its unabashedly pro-union year-end theme of overturning longstanding precedent, the National Labor Relations Board (“NLRB” or "Board") in American Baptist Homes of the West, d/b/a Piedmont Gardens abandoned this bright-line rule in favor of a fact-specific balancing test.  The balancing test will be applied to all information requests made after December 15, 2012.

Under Section 8(a)(5) of the National Labor Relations Act (“NLRA”), an employer must furnish a union with relevant information necessary to the union’s performance of its duties, including for grievance or arbitration purposes.  Under a rule established in its 1978 Anheuser-Busch decision, the Board had consistently applied a blanket exemption from disclosure for witness statements obtained during internal investigations of employee misconduct, reasoning that such an exemption was necessary to avoid coercion and intimidation and to encourage cooperation in internal investigations.

Finding its logic “flawed,” the Board in Piedmont Gardens explicitly rejected the Anheuser-Busch rule.  In its place, the Board held that the production of witness statements should be subject to the same standard as other union information requests and that any attempts to withhold disclosure should be analyzed using the test developed by the U.S. Supreme Court in Detroit Edison Co. v. NLRB.  Under this test, where requested witness statements may contain relevant information, an employer may refuse to produce them only if it can show that a legitimate and substantial confidentiality interest outweighs the union’s need for the information.  Additionally, in order to assert a valid confidentiality defense, an employer must raise its concerns to the union in a “timely manner” and offer an accommodation regarding the information requested before refusing to disclose the statement.

Essentially, a longstanding bright-line rule has been replaced with a test that will force employers to make a case-by-case prediction of how the Board will apply a subjective balancing of interests.  This unclear standard is almost certain to extend the grievance process as parties engage in lengthy proceedings to resolve confidentiality claims.  Lone dissenting member Brian Hayes expressed these very concerns, and he also noted that the production of witness statements is inconsistent with existing guidance from the Equal Employment Opportunity Commission regarding confidentiality in connection with an investigation of an employee’s harassment complaint.

When this decision is combined with the NLRB’s Banner Health decision (previously reported here), which found that an employer’s rule requiring confidentiality during an internal investigation was an unfair labor practice, the effect is a major shift in the law that impedes an employer’s ability to conduct effective and meaningful internal investigations.  In light of these decisions, employers should reassess their current investigatory practices, including whether to continue to produce witness statements, and if so, how best to protect employees from legitimate confidentiality concerns regarding the disclosure of those statements.