Nov 17, 2016 - 3:00pm

Federal Court Unpersuaded by Persuader Rule

Executive Director, Labor Policy

1280px-3d_judges_gavel.jpg via Wikimedia Commons

The U.S. Department of Labor’s (DOL) so-called “persuader rule” appears to have finally met its demise after a federal district court in Texas issued a permanent, nationwide injunction against it.  In a terse, two-page ruling issued November 16, United States District Judge Sam R. Cummings reiterated the reasoning he explained in his June 27 preliminary injunction and set aside the regulation.

As this blog has written previously, the principle issue concerns the “advice exemption” in the Labor-Management Reporting and Disclosure Act (LMRDA), which exempts labor relations consultants and employers from having to report information about their consulting arrangements when the consultant only provides advice but does not engage directly with employees. 

The Department’s longstanding—since 1962—interpretation of that provision held that the exemption covered the vast majority of labor consulting arrangements provided that the consultants did not speak directly with employees to persuade them one way or another about joining a union.

The new persuader rule would have vastly narrowed the scope of that exemption to include both direct and indirect communication with employees regarding unionization.

In his June decision, Judge Cummings noted that, “DOL and the courts have long interpreted the LMRDA’s Advice Exemption as exempting from reporting all advice that had an object to persuade and would, absent the exemption, otherwise trigger reporting.”  It further observed that DOL’s new persuader rule “is not merely fuzzy around the edges….[it] is defective to its core because it entirely eliminates the LMRDA’s Advice Exemption.”

Given that rather doubtful assessment, it comes as little surprise that the judge would issue a permanent injunction, but it is a welcome development just the same.  As a new administration with a different outlook on labor policy takes over the reins of government, one should hope that the persuader rule is gone for good. 

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About the Author

About the Author

Sean P. Redmond
Executive Director, Labor Policy

Sean P. Redmond is Executive Director, Labor Policy at the U.S. Chamber of Commerce.