Department of Labor Reveals Final Persuader Rule

This morning, the DOL revealed its final “persuader” rule -- a regulation that has been in the works for years.  According to the DOL, the rule “realign[s] the Department’s regulations with the text of . . . the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA).”  Among other things, the LMRDA requires certain public reporting by employers and the third parties they retain to persuade their employees “to exercise or not to exercise, or . . . as to the manner of exercising, the right to organize and bargain collectively through representatives of their own choosing.”

The Final Rule, which will be published in the Federal Register tomorrow, is designed to be effective April 25th.  In its press release, the DOL says the Final Rule will apply to covered agreements and arrangements with so-called “persuaders” that are entered into on or after July 1, 2016. 

The Final Rule seeks to significantly expand the scope of what employers and “persuaders” must publicly report to the DOL.  You can expect legal challenges to the Final Rule, with requests to enjoin implementation while that litigation proceeds and to permanently enjoin implementation at the conclusion of the litigation. 

At present, however, all employers -- not just those with unionized employees and not even just those who believe they are the target of actual or potential organizing by labor unions -- need to familiarize themselves with the Final Rule and its potential effects on their businesses. 

Alas, the Final Rule is more than 400 pages long!  Seyfarth Shaw attorneys are already hard at work performing an in-depth analysis of the Final Rule, potential legal challenges to the Final Rule, and best approaches for compliance with the Final Rule.  As soon as we have conducted a thorough analysis, we will be prepared to provide further and more specific guidance. 

In the meantime, you may wish to consider the DOL’s own basic summary of the Final Rule, which reads as follows:

Consultant activities that trigger reporting of an agreement or arrangement with an employer include direct contact with employees with an object to persuade them, as well as the following categories of indirect consultant activity undertaken with an object to persuade employees:

1. Planning, directing, or coordinating activities undertaken by supervisors or other employer representatives including meetings and interactions with employees;
2. Providing material or communications for dissemination to employees;
3. Conducting a labor relations seminar for supervisors or other employer representatives; and
4. Developing or implementing personnel policies, practices or actions for the employer. 

Agreements are not reportable if the consultant merely advises or represents the employer.  For example, agreements under which a consultant exclusively provides legal services are not to be reported.  Representation of the employer before a court or similar tribunal or during collective bargaining negotiations also does not trigger reporting.  Other examples of non-reportable agreements include:

1. Guidance on employer personnel policies and best practices
2. Seminars in which the consultant does not develop or assist the attending employers in developing anti-union tactics or strategies
3. “Vulnerability Assessments,” including the use of surveys, in which a consultant evaluates an employer’s proneness to union-related activity and offers possible courses of action
4. Sales pitches
5. Sales of “off-the-shelf” materials
6. Provision of information for use only in conjunction with an administrative, arbitral, or judicial proceeding
7. Franchisor-franchisee agreements

The entire Final Rule and related information from the Department of Labor can be found here:  http://www.dol.gov/olms/regs/compliance/ecr_finalrule.htm