Dishonesty During Investigation Justified Termination Even If Protected Comments Partially Motivated Discharge: NLRB | Practical Law

Dishonesty During Investigation Justified Termination Even If Protected Comments Partially Motivated Discharge: NLRB | Practical Law

In Fresenius USA Manufacturing Inc., the National Labor Relations Board (NLRB) ruled that an employee's dishonesty during an employer's investigation was not protected activity under the National Labor Relations Act (NLRA) and that the employer did not violate the NLRA when it suspended and terminated the employee. The NLRB's decision differed from a prior NLRB decision in this matter that was set aside by the US Supreme Court's decision in Noel Canning.

Dishonesty During Investigation Justified Termination Even If Protected Comments Partially Motivated Discharge: NLRB

by Practical Law Labor & Employment
Published on 29 Jun 2015 • USA (National/Federal)
In Fresenius USA Manufacturing Inc., the National Labor Relations Board (NLRB) ruled that an employee's dishonesty during an employer's investigation was not protected activity under the National Labor Relations Act (NLRA) and that the employer did not violate the NLRA when it suspended and terminated the employee. The NLRB's decision differed from a prior NLRB decision in this matter that was set aside by the US Supreme Court's decision in Noel Canning.
On June 24, 2015, in Fresenius USA Manufacturing Inc., the three-member panel (Board) heading the NLRB's judicial functions ruled that an employee's dishonesty during an employer's investigation was not protected activity under the NLRA and that the employer did not violate the NLRA when it suspended and terminated the employee. The NLRB's decision differed from an earlier invalid Board panel decision (358 NLRB No. 138 (Sept. 19, 2012)). See Legal Update, Employee's Offensive and Potentially Harassing Comments Are Protected under the NLRA: NLRB. This earlier decision was vacated by the US Court of Appeals for the District of Columbia Circuit because the Board was then composed of two persons whose appointments the Supreme Court held constitutionally infirm in NLRB v. Noel Canning ( 134 S.Ct 2550 (2014)).
(362 N.L.R.B. slip op. 130 (June 24, 2015).)
For more information on Noel Canning, see Article, Expert Q&A on Noel Canning and Its Aftermath and Legal Update, Supreme Court Holds 2012 Recess Appointments to the NLRB Were Invalid, Effectively Invalidates 20-Months of NLRB Decisions.

Background

During a campaign to decertify the International Brotherhood of Teamsters, Local 445 as the collective bargaining representative for Fresenius USA Manufacturing, Inc.'s (Fresenius) employees, a pro-union employee and driver for Fresenius, Kevin Grosso, anonymously scribbled a few vulgar, offensive and arguably threatening comments on three union newsletters he left in an employee breakroom in an attempt to encourage warehouse workers to vote for the union. After several female employees complained, Fresenius investigated and interviewed Grosso. During the interview, Grosso denied making the comments. The following day, he made a telephone call to Fresenius management in which he inadvertently confessed to having written the comments, then tried to conceal that he was the one confessing. Fresenius suspended and ultimately discharged Grosso for making the statements and for his dishonesty during the investigation.
The NLRB issued a complaint based on the union's unfair labor practice charge, claiming that Fresenius violated the NLRA by investigating and disciplining Grosso because of his protected comments. An NLRB administrative law judge (ALJ) found for Fresenius on both claims and dismissed the complaint. The NLRB's Acting General Counsel filed exceptions with the Board, and the Board found that although Fresenius had a legitimate interest in investigating the handwritten comments:
  • Grosso's handwritten comments and dishonesty during the investigation were protected conduct under the NLRA.
  • Fresenius violated the NLRA for suspending and then discharging Grosso for engaging in protecting activity.
That decision was vacated based on the Supreme Court's decision in Noel Canning.

Outcome

The current Board (Chairman Pearce and Members Johnson and McFerran) agreed with the prior Board that Fresenius had a legitimate business interest in investigating the handwritten comments. However, the current Board reached a different conclusion, finding that:
  • Grosso's dishonesty during the investigation was not protected by the NLRA because:
    • Grosso did not have a legitimate interest in lying to shield his Section 7 activity from Fresenius' inquiries; and
    • Grosso had no reasonable basis to believe that Fresenius was attempting to obtain information about his union activity.
  • Assuming Grosso's handwritten statements were protected (the Board held off on deciding this issue, with only Member Johnson finding that the statements were not protected), Fresenius had met its Wright Line burden of showing that it would have suspended and terminated Grosso even without the handwritten statements because Fresenius had imposed the same discipline for similar violations in the past, including terminating two employees for dishonesty during an investigation when neither employee had previously committed an act of serious misconduct (251 N.L.R.B. 1083 (1980); Mountain Shadows Golf Resort, 330 N.L.R.B. 1238 (2000)).
  • Fresenius' termination of Grosso for his dishonesty was lawful under the NLRA.

Practical Implications

The Board's decision in Fresenius represents a rare instance in which a prior Board decision invalidated by Noel Canning is effectively reversed. The decision affirms the legitimate interest employers have in:
  • Investigating conduct that potentially violates anti-discrimination and harassment policies.
  • Disciplining employees (even staunch union supporters) for trying to thwart employer investigations.
Employers should be consistent when imposing discipline on employees who engage in similar dishonesty during an investigation, which will help show that the employer would have taken the same action regardless of an employee's protected activity.