In Part One of my analysis of the recent case brought by the NLRB challenging various aspects of the Rio Hotel & Casino’s employee handbook, I reviewed two parts of the handbook that the Board found objectionable: a prohibition on off-duty clothing and an off-duty access rule.   The ALJ ruled in favor of the Company in both instances.   Below, I will now review two other handbook provisions that the Labor Board objected to and the outcome for each objection.  All Handbook provisions are verbatim from the actual Employee Handbook.


Confidentiality Rules

Employee Handbook: Confidentiality: All employees are prohibited from disclosing to anyone outside the Company, indirectly or directly, any information about the Company which has not been shared by the Company with the general public. This type of

disclosure includes participation in internet chat room or message boards.

Exceptions to the rule include disclosures which are authorized by the Company or

as required or authorized by the law. This information includes, but is not limited


  • Company financial data
  • Plans and strategies (development, marketing, business)
  • Organization charts, salary structures, policy and procedures manuals
  • Research or analyses
  • Customer or supplier lists or related information.

NLRB General Counsel Complaint:  The GC’s objection to this provision was somewhat unclear.  The complaint objected to this entire rule, but in its brief to the ALJ, the GC backed down from that view, and objected only to the prohibition against the disclosure of “organizational charts, salary structures, policy and procedure manuals” and the rule which defined confidential information as “any information about the company which has not been shared by the Company with the general public.”  The GC claimed that these prohibitions would inhibit protected concerted activity because they would preclude employees from discussing wages and working terms and conditions as well as freely contacting and conferring with union representatives, Board agents, or other third parties on “internet chat rooms or message boards” concerning these particular subjects.

ALJ Decision: NLRB loses, on the basis that the Board previously held that a rule prohibiting the disclosure of “organizational charts and databases” did not explicitly restrict Section 7 activity and that the context of such a rule made it doubtful that employees would construe it as interfering with Section 7 either.   The ALJ acknowledged that the Rio’s rule “contains no magic words such as “intellectual property” or “proprietary assets,”” but that nevertheless, “the examples set forth in Respondent’s rules plainly establish that these are the interests Respondent seeks to protect.”

One important lesson for employers here might be to include “magic words” such as “intellectual property” or “proprietary assets” in order to make it clear that this is what is being protected.


Computer Usage Policy

Employee Handbook: Two sections of a long computer usage policy were primarily called into question.

Computer resources may not be used to:

  • Share confidential information with the general public, including discussing the company, its financial results or prospects, or the performance or value of company stock by using an Internet message board to post any message, in whole or in part, or by engaging in an internet or online chat room


  • Do not visit inappropriate (non-business) websites, including but not limited to online auctions, day trading, retail/wholesale, chat rooms, message boards and journals. Limit the use of personal email, including using streaming media (e.g., video and audio clips) and downloading photos.


NLRB General Counsel Complaint: First, the GC urged the ALJ to overturn the Labor Board’s Register Guard decision, which gave employers more leeway to restrict computer usage.   The GC then objected to the two above sections of the handbook, arguing that the limitation on personal email use may “inhibit employee’s Section 7 rights, as they do not allow employees to express concerns which may later become logical outgrowths of group concerns or discuss wages or working conditions.” The GC reached that conclusion because it assumed that the restriction on ““confidential” as used in the computer usage policy parallels that found in the confidentiality rules.”


ALJ Decision: NLRB loses, on the basis that the computer usage policy does not explicitly import the same confidential definition as from the confidentiality rules section.   Furthermore, the ALJ found nothing explicitly restricting Section 7 rights with this provision and that the GC did not meet its burden to establish that the rule would be construed as such.  Finally, the ALJ refused to overrule Register Guard, finding that a matter for the Board.


Stay tuned for Part Three of this series which will review two additional Employee Handbook provisions.