A temporary service agency who terminated an employee for breaching a confidentiality provision in his employment contract violated federal law, the National Labor Relations Board rules. The NLRB says that the agreement stated that the terms of employment, including compensation, were confidential, and that disclosure “to other parties may constitute grounds for dismissal.”

After a pay dispute with his employer, in which the worker told the client he was not getting paid in a timely manner, the company terminated him for “failure to live up to his end of the bargain.” An administrative law judge had initially dismissed the employee’s complaint, finding that since the confidentiality provision did not prohibit employees from discussing their terms and conditions of employment with one another, it did not violate the National Labor Relations Act. The judge further found the restriction on discussing terms of employment with third party clients had a “legitimate and substantial business justification that outweighed the restriction on employee rights.”

The Board reverses the judge’s decision, holding that the term “other parties” would lead employees to “reasonably understand that language as prohibiting discussions of their compensation with union representatives.” The Board says that accordingly, the confidentiality provision was “overbroad” in this respect, and a violation of the NLRA. Northeastern Land Services, Ltd. dba The NLS Group and Jamison John Dupuy