In late April 2021, the Department of Labor’s (DOL) Office of Labor-Management Standards (OLMS) signaled its intent to revisit the “Persuader Rule” — an Obama-era regulation that imposes strict reporting requirements on employers facing organization. Although the Persuader Rule has not yet been reinstated, and will almost certainly face significant opposition, employers should be aware of the possible ramifications of the regulation.
What Is The Persuader Rule?
The Persuader Rule is a regulation that was first promulgated by the DOL during the Obama administration. The rule alters the DOL’s interpretation of the Labor Management Reporting and Disclosure Act of 1959 that requires employers and their labor consultants to report any activities “undertaken with an object, directly or indirectly, to persuade employees about how to exercise their rights to union representation and collective bargaining.” Since its inception, the Act has been interpreted to exempt “advice” from these reporting requirements. As long as a labor consultant did not have direct contact with employees, their guidance was considered “advice” and not subject to the reporting requirements. The Persuader Rule eliminates the “advice” exception, meaning that employers would have to report any assistance rendered by labor consultants, including attorneys, that is “undertaken with an object, directly or indirectly, to persuade employees about how to exercise their rights to union representation and collective bargaining.”
As we reported in April 2016, the Persuader Rule faced substantial opposition from national, state and local business groups culminating in three lawsuits seeking to enjoin enforcement of the rule. In June 2016, the U.S. District Court for the North District of Texas issued a temporary injunction blocking the Persuader Rule from taking effect. The District Court judge found that the business groups opposing the rule were likely to succeed on their claims that, among other things, the rule violated First Amendment rights of free speech and association and the due process clause Fifth Amendment due to its vagueness. Ultimately, the Persuader Rule was permanently blocked by the same District Court as discussed in our November 2016 alert. Following the election of Donald Trump as president, the federal government did not pursue an appeal of the November 2016 decision.
For the full alert, visit the Faegre Drinker website.