Department of Labor Persuader Rule Permanently Blocked Department of Labor Persuader Rule Permanently Blocked

Department of Labor Persuader Rule Permanently Blocked

The U.S. Department of Labor’s controversial “Persuader Rule,” originally set to become effective on July 1, 2016, was permanently enjoined by a federal court in Texas on November 16, 2016. The Rule had required employers and their hired consultants to report both direct and for the first time, indirect, efforts of the consultant to persuade workers to avoid unionization. This persuader activity included not only direct communication with employees by the consultants, but also any indirect, or “behind the scenes” work by the consultant directly with the employer. The Rule even went so far as to reach the employers’ attorneys, which in turn would have required employers and law firms to disclose all legal fees for any work performed—even if it was unrelated to union issues.

The court’s ruling granted judgment in favor of the employer groups that challenged the Rule, but the injunction that was issued bars the Department of Labor from implementing the Rule against any employer or consultant.

It remains to be seen whether the Trump presidency will impact the Department of Labor’s decision to appeal the ruling. An earlier ruling by the same court temporarily blocking the Rule is currently on appeal. Most political commentators expect the Department of Labor to dismiss the pending appeal come inauguration and to not further pursue the Rule.

What does this mean for employers and their consultants? The old persuader rules are still in effect. In other words, direct persuader activity, i.e., direct contact with employees by the consultant, is still reportable. But now employers are free to rely upon the advice and counsel of their lawyers and labor relations experts without triggering any reporting requirement.

For more information on the impact of the blocking of the Persuader Rule, contact Paul Bittner, Demetrice Allen or a member of Ice Miller's Labor, Employment and Immigration group.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.

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