NLRB Goes Against Costco in First Social-Media Ruling

All eyes have been on the reports and memos emanating from the National Labor Relations Board’s general counsel concerning social-media use and policies in the workplace, but this legal alert from Ballard Spahr points to the fact that the board’s Sept. 7 decision in Costco Wholesale Corp. is its first-ever official ruling in this area.

And employers should take heed and be careful and cautious in its wake, the alert says.

In its ruling, the NLRB invalidated Costco’s electronic posting rule that prohibited employees from making statements that “damage the company … or damage any person’s reputation.” The board found the policy overly broad, concluding that it could reasonably be interpreted to “chill” employee exercise of the right to engage in protected, concerted (union) activity.

The alert says the board applied much of the legal reasoning outlined in the three prior general counsel reports to reach this first-ever social-media-policy decision. (Here is my most recent blog post outlining those earlier general counsel reports.)

Although the ruling is extensive and thorough (see my link above), Ballard Spahr’s alert claims it, “like the reports … uses case law developed outside the social-media context in the form of more traditional workplace rules and applies those principles to electronic forms of communication.”

“Much to the chagrin of many in the business community,” the alert states, “Costco does not develop any social media-specific guidance or appear to recognize the very different potential impact on an employer’s operations of a disparaging statement made on the Internet as opposed to one made at the workplace water cooler.”

It’s final warning gets to the heart of my reason for sharing:

In light of the decision, employers can expect the board to be critical of social-media policies that contain broad prohibitions on actions or statements about workplace concerns that do not include examples of the postings the employer may permissibly target. Such examples include defamatory or sexually harassing comments, or the disclosure of an employer’s trade secrets.”