On March 24, the Department of Labor (DOL) issued a final “persuader” rule broadening its scope and imposing new and more far-reaching reporting requirements on employers and their consultants. It is scheduled to take effect on July 1, 2016, and will apply to arrangements, agreements, and payments.
Under the Labor-Management Reporting Disclosure Act (LMRDA), the persuader rule requires employers to report to DOL each time they engage a consultant to directly or indirectly persuade workers concerning their rights to organize and bargain collectively, regardless of whether the consultant has direct contact with workers. Historically, the advice of attorneys, however, has been exempt from the reporting requirements as privileged and confidential attorney-client communications, provided that 1) the attorney limits his or her services to advice, which the client is free to accept or reject, and 2) the attorney avoids direct communications with bargaining unit employees.
As part of the new rule, in addition to reporting activities by a consultant who directly engages with employees, an employer must report agreements, arrangements and expenditures when its attorney or consultant engages in indirect persuader activities. The following indirect activities must now also be reported when it is related to collective bargaining or union organizing:
Trade associations, such as NLBMDA, are subject to the reporting requirements only if they conduct union-avoidance seminars themselves, rather than subcontracting their presentation to a law firm or other consultant. In addition, employers or their representatives that participate in the seminars generally will have no reporting obligations.
The Coalition for a Democratic Workplace, National Association of Manufacturers, Associated Builders and Contractors, and other business groups on March 30, 2016, filed a lawsuit challenging the rule with the United States District Court for the Eastern District of Arkansas. The rule is being challenged on the grounds that it violates an employer’s First Amendment rights and the Fifth Amendment’s due process clause by restricting an employer’s ability to educate and inform their workforce. It is important to note that the rule remains in effect until there is an injunction or the rule is overturned by the court.
All employers-both Union and non-Union should familiarize themselves with the Final Rule and its potential effects on their businesses.
For questions, please contact Ben Gann, NLBMDA’s Vice President of Legislative and Political Affairs, at email@example.com.
The National Lumber and Building Material Dealers Association (NLBMDA) represents its members in the national public policy arena, with emphasis on efforts to 1) promote the industry and educate legislators and public policy personnel; and 2) assist legislative, regulatory, standard-setting and other government or private bodies in the development of laws, regulations and policies affecting lumber and building material dealers, its customers and suppliers. Founded in 1917, the association has over 6,000 members operating single or multiple lumber yards and component plants serving homebuilders, subcontractors, general contractors, and consumers in the new construction, repair and remodeling of residential and light commercial. www.dealer.org.