DOL “Persuader Rule” Put On Hold . . .For Now

DOL “Persuader Rule” Put On Hold . . .For Now

Earlier this year, we discussed the new “persuader rule” from the U.S. Department of Labor (DOL). The new rule required employers to publicly disclose their hiring of labor relations consultants—including attorneys—who persuaded employees on organizing and collective bargaining issues. Notably, the new rule eliminated an exemption from disclosure for the use of consultants who did not directly contact employees, but engaged in “indirect” persuasion (e.g., creating materials, strategies, and policies for organizing campaigns).  The new rule would apply to all covered persuader agreements and arrangements entered into on or after July 1, 2016, but not to agreements or arrangements entered into before July 1, 2016 or associated payments.

Employers received some encouraging news on this front last week, as a federal judge in Texas issued a nationwide injunction temporarily blocking the new rule. The judge found that the plaintiffs had shown a likelihood of success on the merits of their claims that the DOL exceeded its authority in issuing the new rule and that the rule violates free speech and free association rights under the First Amendment.

Although this is far from the end of this issue, as the DOL may appeal the ruling and has not yet indicated whether it will do so, employers can breathe a sigh of relief for now.

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