Last week, the U.S. Court of Appeals for the D.C. Circuit reversed and remanded a pro-employee Board decision concerning an employee who had been discharged based on the “disparaging content” of the testimony he made before state legislators.
Back in October 2012, a bargaining unit employee of Oncor Electric Delivery Company (Bobby Reed) testified before a Texas senate committee that had been tasked with studying the impact of utilizing digital metering devices installed in customer homes by utility companies like Oncor. At the time of Mr. Reed’s testimony before the committee, Oncor and the union were engaged in collective bargaining, and Mr. Reed had informed Oncor that he would testify about the digital meters if the union did not obtain a favorable result in the collective bargaining. When bargaining stalled, Mr. Reed testified at the hearing, during which he stated that the digital meters were causing damage to customers’ homes.
Oncor investigated Mr. Reed’s claim about the digital meters causing damage to customer homes and determined this assertion was incorrect. As a result, Oncor terminated Mr. Reed for providing false testimony. The National Labor Relations Board subsequently found that the discharge violated Section 8(a)(3) of the National Labor Relations Act, as it constituted interference with Mr. Reed’s protected union activities. Oncor appealed to the D.C. Circuit.
In reversing the Board’s decision and remanding, the Court based its decision on the Board’s woefully deficient analysis under the Jefferson Standard test. Under that test, disparaging statements made to third parties (about an employer) are protected if: (1) the employee making the statement indicates the communication is related to an ongoing dispute between the employees and the company; and (2) the communication is not so disloyal, reckless or maliciously untrue as to lose the Act’s protection. In its decision, the Board (admittedly) failed to address the first requirement. Accordingly, the Court found the Board’s reasoning “too opaque to resolve whether it is supported by substantial evidence.”
Thus, the Court remanded the matter back to the Board for further proceedings, where the primary issue will be whether Mr. Reed’s testimony provided an adequate indication of its connection to Oncor’s labor dispute with the union. Importantly, the Court – in providing what it called “guidance for the remand” – analyzed the content of Mr. Reed’s testimony, as well as the surrounding context, and rejected a number of the NLRB’s arguments as to whether the testimony sufficiently signaled any connection to the actual labor dispute.
Oncor – and employers in general – have good reason to hope for a favorable result on remand. With the recent change to a Republican majority, the five-member Board has shifted ideologically to a more pro-employer lineup. And on remand, the Board has been instructed by the Court to – as part of determining the merits issue concerning Mr. Reed’s testimony – clarify which party bears the burden on the first requirement of the Jefferson Standard test (an issue the Board has never previously decided). As a result, the Board will not only be determining the specific fate of Oncor in this case, but will also be impacting the future application of Jefferson Standard to all employers who discipline or discharge employees for disloyalty or disparaging statements.