Revocation of ‘Persuader Rule’ May Aid Union Avoidance

Allen Smith, J.D. By Allen Smith, J.D. July 19, 2018
Revocation of ‘Persuader Rule’ May Aid Union Avoidance

​The Department of Labor's (DOL's) July 17 rescission of the so-called persuader rule solidifies lawyers' and consultants' right to advise employers on labor relations and train managers on what to say to educate employees about how employers stand on unionization. The DOL reporting requirements of employers who hire consultants to discourage unionization are now as they existed before the Obama administration issued the persuader rule in 2016.

We've rounded up SHRM Online resources and articles from other trusted media outlets on this development in the news.

Attorney-Client Privilege Defended

The Labor-Management Reporting and Disclosure Act mandates that employers report to the DOL details, including fees paid to consultants, about activities to persuade workers to not unionize. While the law exempts advice from the reporting requirements, the Obama administration's persuader rule defined this exemption narrowly, leaving some concerned that the attorney-client privilege might be compromised. The persuader rule's potential chilling effect on the attorney-client relationship was a major reason for its rescission.


Reporting Requirements Eased

Nathan Mehrens, the DOL Office of Policy's deputy assistant secretary, explained the motivation for the rescission this way: "For decades, the department enforced an easy-to-understand regulation. Personal interactions with employees done by employers' consultants triggered reporting obligations but advice between a client and attorney did not. By rescinding this rule, the department stands up for the rights of Americans to ask a question of their attorney without mandated disclosure to the government."

(The Hill)

SHRM Opposed Persuader Rule

The Society for Human Resource Management (SHRM) testified before Congress against the persuader rule in 2016. Sharon Sellers, SHRM-SCP, president of SLS Consulting in Santee, S.C., said that the rule would make employers shy away from obtaining the input of HR consultants about the National Labor Relations Act. She spoke in favor of a House of Representatives proposal to nullify the rule.

(SHRM Online)

Court Struck Down Rule

In 2016, the U.S. District Court for the Northern District of Texas barred the persuader rule from taking effect. The rule was deemed overly broad, arbitrary and capricious, noted Fred Schwartz, an attorney with Barnes & Thornburg in Chicago. The rule also unconstitutionally curbed free speech, he added. Although consultants' direct persuasion to rank-and-file employees on union organizing still must be reported, such direct persuasion is rare.

(SHRM Online)

[SHRM members' only toolkit: Preparing for the Possibility of Union Organizing]

Issue Could Resurface

The persuader rule is dead for now but "nothing precludes future administrations from revisiting this issue again," noted Steve Bernstein, an attorney with Fisher Phillips in Tampa, Fla. He said that the persuader rule has the potential to become a "politicized issue."

(SHRM Online)



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