Jul 24, 2018

Persuader Rule

Department of Labor Persuader Rule

On March 23, 2016, we alerted you regarding the Persuader Rule, when the Office of Labor-Management Standards published a final rule, revising the interpretation of the “advice” exemption of section 203(c) of the Labor-Management Reporting and Disclosure Act (“LMRDA”).

However, on July 17, 2018 the Department of Labor (“DOL”), in a news release, rescinded the Persuader Rule, stating that the Persuader Rule “impinged on attorney-client privilege by requiring confidential information to be part of disclosures. . .” The next day, the DOL published a final rule formally rescinding the Persuader Rule, finding that the Persuader Rule relied on an inappropriate reading of Section 203(c) of the LMRDA.

The Persuader Rule required the parties to employer-consultant agreements and arrangements entered into on or after July 1, 2016, to file a report with the DOL if a consultant handled, or agreed to handle, “persuader activities,” defined as “any actions, conduct, or communications that are undertaken with an object, explicitly or implicitly, directly or indirectly, to affect an employee’s decisions regarding his or her representation or collective bargaining rights.”

According to the DOL’s final rule, the reporting requirements in effect now are the requirements as they existed before the Persuader Rule. As a result, employers may continue to engage with their attorneys regarding union activities, without filing reports with the DOL.

If you have any questions or concerns about how this decision may impact your business or have any other questions please contact your labor and employment counsel at Smith, Gambrell & Russell, LLP.

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