Baylor University Medical Center

National Labor Relations Board - Board Decisions

Mar 16, 2020

369 N.L.R.B. 43 (N.L.R.B. 2020)

369 NLRB No. 43
NOTICE: This opinion is subject to formal revision before publication in the
bound volumes of NLRB decisions. Readers are requested to notify the Ex-
ecutive Secretary, National Labor Relations Board, Washington, D.C.
20570, of any typographical or other formal errors so that corrections can
be included in the bound volumes.
Baylor University Medical Center and Dora S.
Camacho. Case 16–CA–195335
March 16, 2020
DECISION AND ORDER
BY CHAIRMAN RING AND MEMBERS KAPLAN AND
EMANUEL
On February 12, 2018, Administrative Law Judge Rob-
ert A. Ringler issued the attached decision. The Respond-
ent filed exceptions with supporting arguments, the Gen-
eral Counsel filed an answering brief, and the Respondent
filed a reply brief. The General Counsel filed a cross-ex-
ception and a supporting brief, the Respondent filed an an-
swering brief, and the General Counsel filed a reply brief.
The National Labor Relations Board has considered the
decision and the record in light of the exceptions and
briefs and has decided to affirm the judge’s rulings, find-
ings,1 and conclusions only to the extent consistent with
this Decision and Order.
The complaint in this case alleges that the Respondent
violated Section 8(a)(1) of the National Labor Relations
Act by including three provisions in severance agreements
offered to numerous employees. The judge found two of
the provisions unlawful, but not the third. For the reasons
that follow, we find all three provisions lawful, and we
therefore dismiss the complaint.
The Respondent offered departing employees the op-
portunity to sign individual separation agreements (the
agreement) in exchange for severance pay and postem-
ployment benefits to which they otherwise would not be
entitled.2 The Respondent did not require anyone to sign
the agreement; any decision to sign was voluntary. In fact,
Charging Party Dora S. Camacho declined the offer. The
agreement included a “No Participation in Claims” provi-
sion, stating that the signatory “agrees that, unless com-
pelled to do so by law, [he or she] will not pursue, assist
or participate in any Claim brought by any third party
against [Baylor] or any Released Party.” The agreement
also included a “Confidentiality” provision, which stated
that the signatory “agrees that [he or] she must . . . keep
1 The judge inadvertently referred to Charging Party Dora Camacho
as “Doris” in the case caption of the underlying decision, which we have
corrected. In addition, the judge at one point referred to her Confidential
“Separation” Agreement and General Release as a Confidential “Settle-
ment” Agreement and General Release. This error is immaterial and
does not affect the decision.
2 The Respondent’s proffered agreements were not identical, but they
all contained the provisions at issue here.
secret and confidential and not . . . utilize in any manner
all . . . confidential information of [Baylor] or any of the
Released Parties made available to [the signatory] during
[his or] her . . . employment, . . . including . . . information
concerning operations, finances, . . . employees, . . . per-
sonnel lists; financial and other personal information re-
garding . . . employees.”3
In analyzing the Respondent’s actions, the judge ap-
plied the analysis set forth in Boeing Co., 365 NLRB No.
154 (2017), which is used to assess the lawfulness of man-
datory work rules relating to employees’ terms and condi-
tions of employment.4 The judge found that the Respond-
ent violated Section 8(a)(1) of the Act by maintaining the
“No Participation in Claims” provision because (1) the
provision banned individuals from voluntarily assisting
Board agents in their investigations of unfair labor prac-
tice charges against the Respondent, and (2) the Respond-
ent “effectively failed to offer a legitimate rationale” for
this ban. The judge also found that the “Confidentiality”
provision violated Section 8(a)(1) because (1) employees
would reasonably construe it as banning protected discus-
sions of wages, hours, and working conditions, and (2) the
Respondent’s stated confidentiality concerns did not out-
weigh the provision’s limitation on rights under the Act.
We disagree with the judge’s application of Boeing to
the agreement at issue. Boeing applies only where an em-
ployer allegedly promulgates or maintains an unlawful
work rule. See id., slip op. at 14–16. Here, the General
Counsel did not allege that the “No Participation in
Claims” and “Confidentiality” provisions themselves
were unlawful, only that the “issuance” or mere proffer of
the agreement containing these provisions to departing
employees was unlawful. Moreover, we find that the
agreement differs from a work rule in two fundamental
ways. First, the agreement is not mandatory; signing it
was not a condition of continuing employment, as it was
optional and applied only in the event of separation. Sec-
ond, the agreement exclusively pertains to postemploy-
ment activities and has no impact on terms and conditions
of employment or any accrued severance pay credit or
benefits arising out of the employment relationship that
the Respondent would be obligated to pay regardless of
whether a departing employee signed. Moreover, we find
no merit in the General Counsel’s allegation that the Re-
spondent’s proffer of the voluntary separation agreement
3 The agreement also included a “Non-Disparagement provision,”
which the judge found lawful. We agree that this provision is lawful, but
we do so for the reasons set forth in our discussion of the other provi-
sions.
4 The hearing was held before the Board issued its decision in Boeing.
After Boeing issued, and upon a notice to show cause, the parties in this
case declined to reopen the record to provide additional evidence.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD2
was unlawful. The complaint does not allege that Charg-
ing Party Camacho or anyone else offered this agreement
was unlawfully discharged for conduct protected by the
Act,5 or that the Respondent’s proffers were made under
any circumstances that would tend to infringe on the sep-
arating employees’ exercise of their own Section 7 rights
or those of coworkers.6
In these circumstances, we find that the mere proffer of
severance agreements containing the three challenged pro-
visions did not reasonably tend to interfere with, restrain,
or coerce employees in the exercise of rights under the
Act.7 Accordingly, we reverse the judge in part and dis-
miss the complaint.8
ORDER
The complaint is dismissed.
Dated, Washington, D.C. March 16, 2020
______________________________________
John F. Ring, Chairman
______________________________________
Marvin E. Kaplan, Member
________________________________________
William J. Emanuel Member
5 Although Camacho filed an unfair labor practice charge over her
discharge, the Acting Regional Director for Region 16 dismissed it, and
she did not appeal that dismissal.
6 Cf. Shamrock Foods Co., 366 NLRB No. 117, slip op. at 3 fn. 12
(2018) (finding provisions of a proffered separation agreement unlawful
because, among other reasons, the employee had been unlawfully dis-
charged), enfd. mem. No. 18–1170 (D.C. Cir. 2019) (per curiam); Metro
Networks, 336 NLRB 63, 66–67 (2001) (same).
As in Shamrock Foods and Metro Networks, the employer in Clark
Distribution Systems, 336 NLRB 747 (2001), offered employees sever-
ance agreements that included non-assistance clauses—i.e., clauses pro-
hibiting the employees from assisting their coworkers if charges con-
cerning coworkers were filed against the employer. In each of these
cases, however, the employees to whom the agreements were offered had
been discharged in violation of the Act. In other words, the employer in
those cases had already demonstrated its willingness to retaliate against
employees for engaging in Sec. 7 activity. Thus, it was reasonable to
believe that further charges may have been filed or might be forthcoming
and that the discharged employees might have relevant information they
would wish to disclose to an investigating Board agent. Under those cir-
cumstances, offering a severance agreement with a non-assistance clause
would reasonably tend to interfere with the exercise of rights protected
by the Act. See American Freightways Co., Inc., 124 NLRB 146, 147
(1959) (“[T]he test of interference, restraint, and coercion under [Sec.]
8(a)(1) of the Act . . . . is whether the employer engaged in conduct
which, it may reasonably be said, tends to interfere with the free exercise
of employee rights under the Act.”). In the instant case, however, sever-
ance agreements with non-assistance clauses were offered to individuals
lawfully separated from employment, and the complaint does not allege
that the Respondent has violated the Act in any way other than by
(SEAL) NATIONAL LABOR RELATIONS BOARD
Megan McCormick and David Foley, Esqs., for the General
Counsel.
Amber M. Rogers, Esq. (Hunton & Williams, LLP), for the Re-
spondent.
DECISION
STATEMENT OF THE CASE
ROBERT A. RINGLER, Administrative Law Judge. This case
was heard in Fort Worth, Texas, on November 28, 2017. The
complaint alleged that the Baylor University Medical Center
(Baylor or the Respondent) violated the National Labor Rela-
tions Act (the Act) by tendering unlawful separation agreements
to its employees. On the entire record, including my observation
of the witnesses’ demeanors, and after considering the parties’
briefs, I make the following
FINDINGS OF FACT1
I. JURISDICTION
At all material times, Baylor has operated a health care system
in Texas. Annually, it derives revenues in excess of $250,000,
and purchases and receives goods and materials valued in excess
of $5000 directly from out-of-state points. It, thus, admits, and
I find, that it is an employer engaged in commerce, within the
meaning of §2(2), (6), and (7) of the Act.
offering the severance agreements themselves. There is no reason to be-
lieve that the Respondent harbors animus against Sec. 7 activity, let alone
that it is willing to terminate employees who engage in it. Under these
circumstances, the offer of a severance agreement does not reasonably
tend to interfere with the free exercise of employee rights under the Act
merely because the offered agreement contains a non-assistance clause.
We recognize, however, that the holding of Clark Distribution Sys-
tems is categorical: offering a severance agreement that includes a non-
assistance clause violates the Act, period. As just explained, that holding
is broader than necessary to safeguard Sec. 7 rights. Accordingly, Clark
Distribution Systems is overruled to the extent it holds that it is invariably
unlawful to offer employees a severance agreement that includes a non-
assistance clause. Instead, the holding of Clark is limited to the fact pat-
tern that case presents, where an employer offers such an agreement to
one or more employees it has discharged in violation of the Act. And
Metro Networks, supra, and Shamrock Foods, supra, are also limited ac-
cordingly.
7 We reject the General Counsel’s argument that precedent involving
settlement agreements that resolve specific labor disputes is applicable
here. See, e.g., S. Freedman & Sons, Inc., 364 NLRB No. 82 (2016),
enfd. 713 Fed.Appx. 152 (4th Cir. 2017). As stated above, the Respond-
ent’s offer of the voluntary separation agreement was not alleged to be
related to any labor dispute, nor were the disputed provisions in the
agreement alleged to have any effect on employees’ terms and conditions
of employment.
8 In dismissing the complaint, we find it unnecessary to address the
Respondent’s remaining arguments.
1 Unless otherwise stated, factual findings arise from joint exhibits,
stipulations and undisputed evidence.
BAYLOR UNIVERSITY MEDICAL CENTER 3
II. ALLEGED UNFAIR LABOR PRACTICES
A. Doris Camacho’s Termination2
Baylor fired Camacho on September 30, 2016.3 On October
4, it offered her over $10,000 in exchange for signing a Confi-
dential Settlement Agreement and General Release (theSepara-
tion Agreement). She refused to sign the Separation Agreement
and, instead, brought the instant charge challenging the legality
of the agreement.
B. Challenged Separation Agreement Provisions
The Settlement Agreement contained, inter alia, these provi-
sions:
6. No Participation in Claims:
CAMACHO agrees that, unless compelled to do so by law,
CAMACHO will not pursue, assist or participate in any Claim
brought by any third party against … [Baylor] or any Released
Party….
7. Confidentiality:
CAMACHO agrees that …. she must … keep secret and con-
fidential and not … utilize in any manner all … confidential
information of … [Baylor] or any of the Released Parties made
available to her during her … employment … , including …
information concerning operations, finances, …, employees,
… personnel lists; financial and other personal information re-
garding … employees; ….
8. Non-Disparagement:
CAMACHO agrees that she shall not … make, repeat or pub-
lish any false, disparaging, negative, … or derogatory remarks
… concerning … [Baylor] and the Released Parties … or oth-
erwise take any action which might reasonably be expected to
cause damage … to … [Baylor] and the Released Parties ….
(GC Exh. 2.)
C. Analogous Separation Agreements
Between November 30 and October 23, 2017, Baylor entered
into 26 equivalent Separation Agreements with other workers.
(GC Exh. 3.) These agreements contained analogous No Partic-
ipation in Claims, Confidentiality and Non-Disparagement
clauses.4
III. ANALYSIS
The No Participation in Claims and Confidentiality provisions
are unlawful; the Non-Disparagement provision is, however,
valid. The Board has held that the following analytic framework
should be applied:
2 Her firing was not alleged to be unlawful. This Decision, thus, does
not take a stance on the validity of this action.
3 All dates are in 2016, unless otherwise stated.
4 Although these agreements were entitled Workforce Realignment
Agreement and General Release, they were essentially equivalent to
Camacho’s Separation Agreement. As a result, the term Separation
Agreement shall globally describe these Workforce Realignment Agree-
ments and General Releases as well as Camacho’s agreement.
[W]hen evaluating a facially neutral policy, rule or handbook
provision that, when reasonably interpreted, would potentially
interfere with the exercise of NLRA rights, the Board will eval-
uate two things: (i) the nature and extent of the potential impact
on NLRA rights, and (ii) legitimate justifications associated
with the rule. We emphasize that the Board will conduct this
evaluation, consistent with the Board’s “duty to strike the
proper balance between … asserted business justifications and
the invasion of employee rights in light of the Act and its pol-
icy,” … focusing on the perspective of employees, which is
consistent with Section 8(a)(1).… As the result of this balanc-
ing, … the Board will delineate three categories of employment
policies, rules and handbook provisions (hereinafter referred to
as “rules”):
 Category 1 will include rules that the Board designates
as lawful to maintain, either because (i) the rule, when
reasonably interpreted, does not prohibit or interfere
with the exercise of NLRA rights; or (ii) the potential
adverse impact on protected rights is outweighed by
justifications associated with the rule. Examples of
Category 1 rules are … the “harmonious interactions
and relationships” rule that was at issue in William
Beaumont Hospital, and other rules requiring employ-
ees to abide by basic standards of civility….
 Category 2 will include rules that warrant individual-
ized scrutiny in each case as to whether the rule would
prohibit or interfere with NLRA rights, and if so,
whether any adverse impact on NLRA-protected con-
duct is outweighed by legitimate justifications.
 Category 3 will include rules that the Board will des-
ignate as unlawful to maintain because they would
prohibit or limit NLRA-protected conduct, and the ad-
verse impact on NLRA rights is not outweighed by jus-
tifications associated with the rule. An example of a
Category 3 rule would be a rule that prohibits employ-
ees from discussing wages or benefits with one an-
other.
Boeing Co., 365 NLRB No. 164, slip op. at 3–4 (2017).5
1. No Participation in Claims Clause
The No Participation in Claims clause is unlawful. This rule
falls under Boeing Category 3, inasmuch as the adverse impact
on core NLRA-protected rights is not outweighed by the rule’s
justification. Specifically, this rule has the very “predictable”
impact of barring NLRA-protected conduct because it bans for-
mer employees from, “pursu[ing], assist[ing] or participat[ing]
in any Claim brought by any third party against … [Baylor].”
This litigation ban encompasses individuals, who might provide
5 On December 19, 2017, the parties were ordered to show cause
whether this new precedent warranted reopening the record in this case
for the taking of additional evidence. On December 29, 2017, the parties
each declined to reopen the record in this case. The Order to Show Cause
and the parties’ responses are hereby admitted as ALJ Exhs. 2–4 respec-
tively.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD4
voluntary information to Board agents in furtherance of ULP
charges filed against Baylor (i.e., NLRA-protected conduct).
Given that the Board’s “ability to secure vindication of rights
protected by the Act depends in large measure upon the ability
of its agents to investigate charges fully to obtain relevant infor-
mation and supporting statements from individuals,”6 this ban
strikes at the very core of NLRA-protected conduct. Baylor ef-
fectively failed to offer a legitimate rationale regarding why for-
mer employees cannot provide information to NLRB agents that
is unrelated to their termination or might vindicate other valid
NLRA interests. The balancing test, as a result, tips heavily in
favor of finding that the severe impact of barring former workers
from providing testimony to Board agents about alleged labor
relations violations heavily outweighs Baylor’s mostly unsub-
stantiated justification for the rule. This rule is, thus, invalid.
2. Confidentiality Provision
The Confidentiality provision is similarly unlawful. This rule
also falls under Boeing Category 3, inasmuch as its adverse im-
pact on NLRA-protected rights is not outweighed by any justifi-
cation. The Confidentiality provision would reasonably be con-
strued by former employees to prohibit §7 activities by banning
discussion of wages, hours, and working conditions with current
employees, unions or others after their separation. The Board
has held that comparable rules have the predictive effect of lim-
iting §7 discussions of wages, hours and working conditions.7
See Boeing, 365 NLRB No. 164, slip op. at 4 (stating that an
“example of a Category 3 rule would be a rule that prohibits em-
ployees from discussing wages or benefits with one another.”).
Although Baylor attempted to justify its rule as a protection
against former employees divulging private health-care related
information, its current provision also broadly encompasses
wages and benefits, and is not expressly limited to health-care
communications. The Confidentiality provision, therefore, fits
within Category 3, and is unlawful because its limitation on
NLRA-protected conduct (e.g., wage and benefit discussions) is
not outweighed by Baylor’s reported justification.
3. Nondisparagement Provision
The Non-Disparagement provision is lawful. The Board has
held that, “rules requiring employees to abide by basic standards
of civility” are generally lawful under Boeing Category 1. See
Boeing, 365 NLRB No. 164, slip op. at 4. The
6 See Metro Networks, 336 NLRB 63, 67 (2001).
7 See also Rocky Mountain Eye Center, P.C., 363 NLRB No. 34, slip
op. at 1 fn. 1 (2015) (employer’s confidentiality agreement provided that
“information about physicians, other employees, and the internal affairs
of [the company] are considered confidential”); DirectTV U.S., 359
NLRB 545, 547 (2013), reaffd. 362 NLRB No. 48, slip op. at 1 fn. 1
(2015) (“confidentiality” provision warned employees to “[n]ever dis-
cuss details about your job, company business or work projects with an-
yone outside the company” and to “[n]ever give out information about .
. . employees,” and expressly included “employee records” as one cate-
gory of “company information” that must be held confidential); Cintas
Corp., 344 NLRB 943 (2005), enfd. 482 F.3d 463 (D.C. Cir. 2007) (rule
“protect[ing] the confidentiality of any information concerning the com-
pany, its business plans, its partners, new business efforts, customers,
accounting and financial matters” could be reasonably construed by em-
ployees to restrict discussions of wages and other terms and conditions
of employment with other employees and with the union).
Nondisparagement provision, which bars “false, disparaging,
negative, . . . or derogatory remarks,” is a valid civility standard.
Id.
CONCLUSIONS OF LAW
1. Baylor is an employer engaged in commerce within the
meaning of §2(2), (6), and (7) of the Act.
2. Baylor violated §8(a)(1) by8
(a) Maintaining a No Participation in Claims clause in its
Separation Agreements, which bars employees from pursuing,
assisting or participating in claims brought against Baylor.
(b) Maintaining a Confidentiality clause in its Separation
Agreements, which bans discussion of wages, hours, and work-
ing conditions with employees, unions or other parties.
3. The unfair labor practices set forth above affect commerce
within the meaning of §2(6) and (7) of the Act.
REMEDY
Baylor is ordered to cease, desist and take certain affirmative
action designed to effectuate the Act. Having found that its Sep-
aration Agreements contained unlawful No Participation in
Claims and Confidentiality clauses, it shall be required to rescind
those provisions and notify the employees who signed the re-
leases, in writing, that it has done so. It shall also post the at-
tached notice in accordance with J. Picini Flooring, 356 NLRB
11 (2010).
On these findings of fact and conclusions of law, and on the
entire record, I issue the following recommended9
ORDER
Baylor, its officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Maintaining No Participation in Claims clauses in its Sep-
aration Agreements, which bar former employees from pursuing,
assisting or participating in any claim brought by any third party
against Baylor.
(b) Maintaining Confidentiality clauses in its Separation
Agreements, which ban discussion of wages, hours and working
conditions with employees, unions or other parties.
(c) In any like or related manner interfering with, restraining,
or coercing its employees in the exercise of the rights guaranteed
them by Section 7 of the Act.
8 Baylor offered two equally unpersuasive defenses. First, it con-
tended that its actions were lawful because Camacho, who had been
fired, was not a statutory employee covered by the Act when offered the
Separation Agreement. This argument ignores Board precedent that
fired employees remain statutory employees covered by the Act. See,
e.g., Little Rock Crate & Basket Co., 227 NLRB 1406 (1977). Second,
Baylor averred that its actions were lawful because Camacho never
signed the Separation Agreement. This contention ignores precedent
holding that violations flow from offering invalid severance agreements,
irrespective of whether they are signed. See Metro Networks, Inc., 336
NLRB 63 (2001). It also ignores the fact that 26 Workforce Realignment
Agreement and General Releases, with analogous language, had been
signed.
9 If no exceptions are filed as provided by §102.46 of the Board’s
Rules and Regulations, the findings, conclusions, and recommended Or-
der shall, as provided in §102.48 of the Rules, be adopted by the Board
and all objections to them shall be deemed waived for all purposes.
BAYLOR UNIVERSITY MEDICAL CENTER 5
2. Take the following affirmative action necessary to effectu-
ate the policies of the Act.
(a) Within 14 days of this Order, rescind the unlawful portions
of the Separation Agreements described above and notify the
employees who signed the releases, in writing, that this has been
done.
(b) Within 14 days after service by Region 16, post at all of
its offices copies of the attached notice marked “Appendix.”10
Copies of the notice, on forms provided by the Regional Direc-
tor, after being signed by the Respondent's authorized repre-
sentative, shall be posted by the Respondent and maintained for
60 consecutive days in conspicuous places, including all places
where notices to employees are customarily posted. In addition
to physical posting of paper notices, notices shall be distributed
electronically, such as by email, posting on an intranet or an in-
ternet site, and/or other electronic means, if the Respondent cus-
tomarily communicates with its employees by such means. Rea-
sonable steps shall be taken to ensure that the notices are not al-
tered, defaced, or covered by any other material. If the Respond-
ent has gone out of business or closed the facility involved in
these proceedings, it shall duplicate and mail, at its own expense,
a copy of the notice to all current employees and former employ-
ees employed by it at any time since October 4, 2016.
(c) Within 21 days after service by the Region, file with the
Regional Director a sworn certification of a responsible official
on a form provided by the Region attesting to the steps that it has
taken to comply.
Dated Washington, D.C. February 12, 2018
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we violated
Federal labor law and has ordered us to post and obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your be-
half
Act together with other employees for your benefit and
protection
Choose not to engage in any of these protected activities.
WE WILL NOT maintain No Participation in Claims clauses in
our Separation Agreements, which prohibit former employees
from pursuing, assisting or participating in any claims brought
against us by any third party.
WE WILL NOT maintain Confidentiality clauses in our Separa-
tion Agreements, which ban discussion of wages, hours and
working conditions with our employees, unions or other parties.
WE WILL NOT in any like or related manner interfere with, re-
strain, or coerce employees in the exercise of the rights set forth
above.
WE WILL rescind the unlawful No Participation in Claims and
Confidentiality clauses in our Separation Agreements, and WE
WILL notify each employee who signed agreements containing
these clauses, in writing, that we have done so.
BAYLOR UNIVERSITY MANOR
The Administrative Law Judge’s decision can be found at
www.nlrb.gov/case/16-CA-195335 or by using the QR code be-
low. Alternatively, you can obtain a copy of the decision from the
Executive Secretary, National Labor Relations Board, 1015 Half
Street, S.E., Washington, D.C. 20570, or by calling (202) 273-1940.
10 If this Order is enforced by a judgment of a United States Court of
Appeals, the words in the notice reading “Posted by Order of the National
Labor Relations Board” shall read “Posted Pursuant to a Judgment of the
United States Court of Appeals Enforcing an Order of the Nation al La-
bor Relations Board.”