Challenges to the DOL’s Persuader Rule

The Department of Labor finalized changes to its controversial “persuader” rule, requiring employers and their labor consultants, including attorneys, to report any arrangement to directly or indirectly persuade employees regarding unionization.  Many attorneys object that this requirement would violate attorney-client privilege, and the rule is already facing multiple challenges in courts across the country, including at least one in Minnesota. 

The previous rule only required these arrangements to be reported if the consultant directly communicated with employees, but under the new rule—which is set to take effect on April 25, 2016, and apply to any arrangements, agreements, and payments made on or after July 1, 2016—expands this requirement so that if consultants merely advise management on how to communicate with employees, this will need to be reported as wall.  The court challenge is attempting to block the rule before it goes into effect. 

Questions? Contact Minnesota attorneys at (952) 746-1700 or email jasherman@wesselssherman.com

DOL’s New Persuader Rule Adds to an Increasingly Stacked Deck Favoring Labor Unions in Organizing New Members

As part of a pattern of federal agencies kowtowing to the interests of unions, the DOL is moving forward with its proposal to significantly narrow an exemption that allows attorneys to provide confidential advice to employers throughout the course of union organizing.  The provision in question creates an “advice” exemption from employers’ reporting requirements when hiring a consultant in connection with attempts to persuade employees about the right to organize and bargain collectively.  If this proposed rule becomes final in its present form, employers and consultants, including attorneys, hired to assist in countering union organizing would be required to publicly disclose their relationship, through the Labor-Management Reporting and Disclosure Act’s (LMRDA) requirements to report any agreement or arrangement between an employer and a third party consultant, to persuade employees as to their collective bargaining rights or to obtain certain information concerning the activities of employees or a labor organization in connection with a labor dispute involving the employer.  This disclosure requirement, when applied to attorneys, flies in the face of traditional notions of attorney-client privilege, and its goal of fostering free and open communication between attorneys and their clients.

Earlier this year, the NLRB published its so-called “ambush election” rule, which shortened the time between when a union election petition is filed and when the election is held, to as little as 21 days.  This new election procedure has been in effect since April 14, 2015, 2015 and already it has drastically impacted employers’ abilities to respond to union organizing campaigns. Now that ambush elections are helping unions organize more effectively, the DOL’s persuader rule should further aid unions by compromising employers’ use of consultants and attorneys in opposing unionization of their workforces.   The proposed rule is being submitted to the Office of Management and Budget for review, which is a final step to implementation.   According to the DOL’s regulatory agenda, it expects to publish the final persuader rule by March of 2016.

Questions? Contact the attorneys of our Minneapolis office at (952) 746-1700 or email Christine Beggan at chbeggan@wesselssherman.com for more information.