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Legal Issues
Jun 1, 2016

Keeping Employee Matters Confidential

Sponsored Content provided by Geoffrey Losee - Partner, Rountree Losee LLP

A federal court recently reminded North Carolina employers that their communications about employees should be carefully guarded. Against the backdrop of so much guidance from the National Labor Relations Board encouraging free speech among employees, this case is a good reminder that the same logic does not apply when the employer is doing the talking.
In Sirona Dental, Inc. v. Smithson, the employer terminated an employee after concluding that that he wrongfully set up his wife as a company vendor. The employee’s supervisor later shared his views on the employee’s conduct with senior managers.
The employee claimed that these comments defamed him. Normally, to prove defamation, a party must demonstrate that the false and damaging comment was published to a third person. Because employers must communicate internally about employee performance to achieve legitimate business goals, internal employer discussions about employee performance generally are not considered to be “published” to third parties. The Sirona employer therefore defended its internal communications about its former employee as intra-office in nature.
In this case, though, the court found that the employer had gone too far with its intra-office communications. The higher-level managers had not been a part of the investigation into the employee’s alleged misconduct, and they therefore had no business need to hear the details of the investigation. Under these facts, even an intra-office communication could constitute “publication” of a statement to a third party for purposes of proving defamation.
What is the lesson for employers? When discussions take place about onboarding, disciplining, evaluating or separating employees, the employer should limit those communications to those employees with an actual need to be involved in the discussion. Once a matter has been investigated and decisions made, the only appropriate communication with others is to confirm the conclusion of the personnel action – not the content.
In addition, employers should never tolerate workplace communications that are motivated by actual malice. Knowing that a statement is untrue and wanting the statement to harm another person will always create defamation risk in the workplace.
Geoff Losee can be reached by visiting, by email at [email protected] or by calling (910) 763-3404. Rountree Losee LLP has provided a full range of legal services to individuals, families and businesses in North Carolina for over 110 years. As well-recognized leaders in each of the areas in which they practice, the attorneys of Rountree Losee provide clients a wealth of knowledge and experience. In their commitment to provide the highest quality legal service, they handle a wide range of legal issues with creativity, sensitivity and foresight. 

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