"Persuader Rule" revision is rescinded

Judd H. Lees, Sebris Busto James

On Tuesday, July 17, 2018, the U.S. Department of Labor issued a final rule rescinding a proposed Obama-era change to the so-called “persuader” requirements of the Labor-Management Reporting and Disclosure Act. Under the proposed change, the “advice” exemption, which allows attorneys, third-party advisors and trade organizations like AGC, to provide guidance to employers on labor law and union avoidance, would have been greatly narrowed, thereby resulting in heightened financial-reporting requirements for these labor-relations experts as well as employers.

The proposed change was first raised by the DOL in 2011 and its clear purpose was to discourage attorneys and trade groups like AGC from educating employers about labor law compliance, thereby hamstringing employers in their efforts to lawfully respond to organizing activity. For this reason, AGC and others campaigned relentlessly, and sought judicial relief, in order to block the rule’s enactment.

As a result, the so-called “advice” exemption still remains in effect, although the long-standing reporting requirements remain for third-party consultants who directly communicate with employees about union issues during a union campaign. As long as service providers limit their role to providing advice rather than communicating directly with employees, there is no reporting requirement.

The final rule rescinding the Obama rule will go into effect on August 16, 2018, although a permanent injunction blocking the rule change has been in effect since November 16, 2016.
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Judd Lees is a shareholder with Sebrus Busto James and a member of AGC’s Legal Affairs Committee.