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Publications | June 29, 2016
2 minute read

U.S. Department of Labor’s Persuader Rule on Hold

On June 27th, a federal judge in Texas issued a preliminary injunction, putting a nationwide temporary hold on the U.S. Department of Labor's (DOL) effort to expand the so-called “Persuader Rule” to cover indirect persuader activities. As a result of this decision, the DOL is prohibited from implementing the extension of the rule until the case is settled by the courts.

The Persuader Rule requires employers and their advisors (including lawyers) to file public reports with the DOL disclosing any services performed to “indirectly persuade” employees regarding union organizing or collective bargaining. An example of indirect persuasion could include advising an employer on how best to discuss unionization with its employees. Previously, these reports were mandated only if an advisor made direct contact with the employer’s employees. An example of direct persuasion could include a third-party advisor meeting face-to-face with the employer’s workforce. Three lawsuits were filed against the DOL, arguing that the revised Persuader Rule is inconsistent with existing law, violates the First and Fifth Amendments and interferes with the attorney-client privilege.

Last week, a federal court in Minnesota denied a similar request for an injunction. The Minnesota court, like the court in Texas, found that the challengers of the DOL’s revised rule had shown a strong likelihood of success on their claims, but the Minnesota court did not find that the challengers had shown any irreparable harm if the DOL’s revised rule went into effect while it was being challenged in the courts. The Texas court saw things differently and found that, “The chilling of speech protected by the First Amendment is in and of itself an irreparable injury.”  

Services for direct persuader activity continue to be reportable.