The Final Persuader Rule Is Here, For Now.

Randi Klein Hyatt
Randi Klein Hyatt

On March 23, 2016, the Department of Labor revealed its long-time coming final rule that requires certain disclosures now be made for outside labor relations consultants who assist employers during union organizing activity or collective bargaining, and which are no longer protected under the “advice” exemption under the disclosure obligations.  The reporting requirements under Labor-Management Reporting and Disclosure Act will now include any third party labor relations attorney or consultant that an employer engages to try and prevent its employees from unionizing if the consultant engages in “persuader” activities that go beyond providing advice, and even if the consultant does not have direct contact with workers.

The unions say this is a great thing and results in transparency.  Those opposed bemoan how one-sided the disclosure mandate is, the obvious concerns over the attorney-client relationship, as well as impinging on employer free speech.  The rule published today, March 24, will take effect April 25, 2016, and will apply to arrangements, agreements, and payments made on after July 1, 2016.

The following persuader activities will need to be disclosed in the yearly disclosure form:

  • planning, directing or coordinating supervisors or managers
  • providing persuader materials for employees
  • training supervisors or managers or other employer representatives to conduct meetings
  • drafting, revising or presenting speeches
  • developing personnel policies designed to persuade employees
  • identifying employees for discipline, reward or other focus

Opponents appropriately raise concerns about whether attorney-client protected information will be impacted. Secretary Perez claims it does not because it does not seek the content of any messages, which does not really address the real implication of what disclosure means.  Of course businesses with in-house counsel savvy on these items will escape obligatory disclosure.  The rest of the pack, however, will not.  Employer advocates call this rule unfair for many reasons, noting the smaller business that receive an election petition, and have rules that must be followed from the moment the process starts, that will now be discouraged from seeking the legal advice needed to comply.  House Republicans already have indicated they are considering legislative options to block the rule.  Other employer-advocate groups also confirm legal challenges will be filed imminently.  We will keep you posted on how this disclosure obligation will play out.

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