Reference no: EM132268804

The ReadyPro Company (the Company) operates as a temporary employment agency which furnishes employees to client firms in the natural gas pipeline and fiber optic telecommunications industries. Janice Martinez was employed by the Company to perform services for a client firm, the Bengali Gas Pipeline company. As part of the employment agreement between Martinez and ReadyPro, she was required to sign a confidentiality agreement which stated the following: “Employee understands that the terms of this employment, including compensation, are confidential to Employee and the ReadyPro Company. Disclosure of these terms to other parties may constitute grounds for dismissal.” Martinez began work at the Bengali Gas Pipeline Company in July and was assigned to the San Antonio project. Shortly thereafter, Martinez experienced delays in receiving her regular pay. This was a particular burden for Martinez because she had to pay for her lodging expenses up front and then was to be reimbursed as part of her regular pay check. Martinez initiated several conversations with managers at ReadyPro about the payment delays including vice president and chief operating officer David Brown, who was responsible for human resource issues at the company. Martinez finally told Brown that if the problem was not corrected she would be forced to notify the Bengali Gas Pipeline project manager that she was quitting. Brown promised that he would call the Bengali Gas Pipeline manager to discuss a possible alteration in the payment schedule for living expenses. Several days later, in early October, Brown informed Martinez that the Bengali Gas Pipeline project manager had refused to make any alteration in the current payment schedule for reimbursing lodging expenses. At about this same time a second pay dispute arose between Martinez and the Company concerning the rate of reimbursement she received for the work-related use of her personal computer on the project. At the beginning of her work on the San Antonio project Martinez had arranged with the project manager that she would be reimbursed $15 per day for the work-related use of her personal com- puter equipment. On October 2, Martinez received an e-mail from ReadyPro manager Brown which referred to a computer reimbursement rate of $12 per day. Martinez replied to Brown stating that since she began work on the project the Bengali Gas Pipeline Company had been reimbursing her $15 per day for personal computer usage as agreed upon and questioned why Brown’s previous e-mail had referred to a reimbursement rate of $12 per day. Brown replied to Martinez that due to tax considerations the cost of providing the reimbursement had increased and therefore resulted in the lower reimbursement rate of $12 per day. Martinez again replied to Brown and copied the San Antonio project manager on the e-mail. In the e-mail reply Martinez asked the San Antonio project manager if the Bengali Gas Pipeline Company could offset the reduction in the reimbursement rate imposed by ReadyPro so she could continue to receive a reimbursement rate of $15 per day. Martinez stated if this was not possible, then she would no longer use her personal computer for work- related correspondence and the Bengali Gas Pipeline Company would have to furnish her with a digital camera and e-mail correspondence capability. “After today and until the matter has been resolved, my equipment is offline.” On October 11, Brown and Martinez had one final telephone conversation in which Brown told Martinez that despite the Company’s efforts to accommodate her concerns it appeared that the Company could not make her happy. Brown stated that Martinez had not lived up to her confidentiality agreement not to disclose the terms of her employment to outside parties and therefore, the Company was terminating Martinez’s service as an employee of the ReadyPro temporary employment agency. Martinez filed an unfair labor practice complaint with the National Labor Relations Board alleging that the Company’s confidentiality agreement was overly broad unlawfully restricting her rights under Section 7 of the LMRA. Martinez further alleged that since the policy that served as the basis for her discharge was unlawful, then her discharge was also unlawful and she should be entitled to reinstatement and back pay.

1. If you were representing the Company in this case, what argument (facts and reasons) could you make that the confidentiality agreement had a legitimate business purpose and was applied appropriately to Martinez?

2. Explain Martinez’s reasoning that the confidentiality agreement is so broadly worded as to represent a restriction on her exercise of some protected right under the language of Section 7, LMRA.

3. If you were a member of the NLRB, how would you rule in this case and why?