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No, Stealing Personnel Files Is Not Protected Activity (But the analysis doesn’t end there)

By: Kelly Muensterman

On November 15, 2018, the United States Fourth Circuit Court of Appeals affirmed the decision of the Middle District of North Carolina in the case of Netter v. Barnes, et al, upholding dismissal of Netter’s case because her removal of other employees’ personnel files from the workplace is not “protected activity” and is a legitimate non-discriminatory reason for her termination.[1] A longtime employee of the Sheriff’s Department, Catherine Netter believed she was being discriminated against on account of her race and religion and removed several coworkers’ personnel files without permission, presumably “fishing” to determine whether said employees were being treated more favorably than her. Then, Netter copied the files and shared them with the Equal Employment Opportunity Commission (“EEOC”) when attempting to support her charge of discrimination. Eventually, Netter sued her employer for discrimination when she was passed over for a promotion. Netter (through her attorney) subsequently produced the files to the Sheriff in discovery. When deposed, Netter conceded that she had obtained the files as described above.

In response, the Sheriff’s Department terminated her employment, citing, in addition to violations of internal policy, Netter’s violation of N.C. Gen. Stat. § 153A–98, which imposes criminal penalties for reviewing or disseminating information in county personnel files without authorization. Netter amended her lawsuit to include a retaliation claim under Title VII’s “participation clause,” which protects “participat[ion] in any manner in an investigation, proceeding, or hearing…” 42 USC § 20000e-3(a). Netter argued that her theft of personnel files fell under the participation clause, and even conceded that her actions violated the law.

The Sheriff argued that any disclosure of information in violation of an employer confidentiality policy would fall outside of the scope of the participation clause, even if the employee had permission to access the information and disclosed it only to the EEOC in connection with a Title VII claim. The Court took a middle path, holding that the participation clause “does not protect a violation of a valid state law that poses no conflict with Title VII.”

The Court did leave some breadcrumbs regarding the types of laws that could conceivably conflict with Title VII. Specifically, the Court noted in dicta the importance of personnel files to show evidence of disparate treatment. One can imagine that courts might take a closer look at a state law that, for instance, placed limits on the ability of the EEOC (or a corresponding state agency) to seek the information contained in personnel files. In any case, employers should ensure that access to personnel files and other confidential information is strictly monitored.

[1] http://hr.cch.com/ELD/NetterBarnes111518.pdf