Hunton Employment & Labor Perspectives

On September 20, 2012, Administrative Law Judge Clifford H. Anderson struck down telecommunications company EchoStar Corp.’s policy prohibiting employees from making disparaging comments about it on social media sites. The NLRB judge found that the prohibition, as well as a ban on employees using social media sites with company resources or on company time, chilled employees’ exercise of their rights under Section 7 of the National Labor Relations Act (“NLRA”). The EchoStar decision comes on the heels of the NLRB’s recent ruling striking down Costco Wholesale Corp.’s policy barring employees from posting statements online that were harmful to the company’s reputation.

In EchoStar, the judge held that the clause prohibiting “disparaging” comments was overbroad and failed to include exceptions for speech that may be critical of the company but is nonetheless protected by Section 7 of the NLRA. In doing so, he rejected the company’s argument that the challenged provision was not overbroad when read in the context of the entire social media policy and an accompanying employee handbook, which included a savings clause stating that in the event of a conflict between EchoStar policy and the law, “the appropriate law shall be applied and interpreted so as to make the policy lawful.” The judge found that a reasonable employee would not react to the savings clause by “losing the chill that the rule under challenge causes.” That the policy went on to tell employees to “remember to use good judgment” in deciding what types of comments to post to social media sites was found to be similarly ineffective at convincing a reasonable employee that the exercise of his or her Section 7 rights remained uninhibited.

The EchoStar decision echoes the reasoning of the Costco decision, and indicates that the NLRB will continue to subject broad social media policies that restrict employee speech without any specific limitations to harsh scrutiny. The case also reinforces the guidance in NLRB Acting General Counsel Lafe Solomon’s three memoranda issued earlier this year stating that restrictions on the usage of social media must be narrowly tailored and clear, and vague policies will be found to be overbroad even if they contain a general savings clause.