Persuader Rule

 

Persuader Rule - URGENT Agreement

 

CLICK HERE TO OPEN the Labor Relations Advice Representation Agreement that we suggest you execute and return to us in an effort to avoid the new reporting requirements that become effective July 1, 2016.  You may send the completed form to erin@wtcabc.org or fax to the ABC office at 901-794-9590.

The U.S. Department of Labor's (DOL) Office of Labor-Management Standards (OLMS) recently published its highly controversial "persuader" regulation, which requires employers and labor relations consultants, including legal counsel, to publicly disclose relationships that have traditionally been permitted to remain confidential under the Labor-Management Reporting and Disclosure Act (LMRDA).  Although the new persuader regulations took effect on April 25, 2016, the new rule will not apply to agreements entered into before July 1, 2016.  This presents an invaluable opportunity for employers and their labor consultants to be "grandfathered" out of much of the required reporting under the new regulations. 

 

The rule has long been that the activities of consultants and/or attorneys who directly speak to an employee or directly engage an employee in efforts to attempt to persuade the employee to refrain from joining a union had to be reported.  In the past, however, indirect actions by consultants and/or attorneys, such as providing guidance and advice to employers had been exempt from the reporting requirements of the LMRDA.  Through the new "persuader" rule, the DOL has now changed the landscape requiring employers' and attorneys to report even indirect consultations or advice if a purpose was arguably to assist the employer in avoiding unionization.   Now where a consultant and/or attorney provides indirect advice, such as (1) plans, directs, or coordinates activities, meetings and interactions with employees for supervisors or other Company representatives; (2) provides material or communications to the employer, in oral, written, or electronic form, for dissemination or distribution to employees; (3) conducts seminars for supervisors or other representatives of the employer with a design to avoid unionization or other persuader activities; or (4) develops or implements personnel policies, practices, or actions for the employer that include policies or actions to avoid unionization or other persuader activities, such activities are reportable.

Under the new rule employers will now be required to report their relationships with counsel, including: (1) the date and amount of any reportable arrangement; (2) the name, address, and position of the individual with whom the arrangement was made; and (3) "a full explanation of the circumstances of all payment made, including the terms of any agreement or understanding pursuant to which they were made."  Additionally, your labor relations consultants and/or attorneys will now be required to file a Form LM-20 within 30 days of entering into a reportable engagement with an employer, disclosing: (1) the parties to the arrangement; (2) the "object" and terms and conditions of the arrangement; and (3) the activities that will be, or have been, performed pursuant to the arrangement. 

The DOL's new rule threatens to compromise the attorney-client privilege and requires the release of information that attorneys are still bound by ethical rules to protect.  Unfortunately, these ethically conflicts have yet to be reconciled. 

 

The DOL has publically stated that it will not apply the Rule to arrangements or agreements entered into prior to July 1, 2016 and that services and payments made pursuant to a multi-year agreement will not trigger reporting requirements for either the employer or its counsel as long as the agreement was entered into before July 1, 2016.  The DOL has not had a chance to apply its new Rule to a pre-July 1 Agreement for post-July 1 activities - so its opinion could change.  As least one DOL attorney has privately opined that he does not believe that was the intent of the DOL's public comments.     

 

As a result of this confusion, we are strongly advising employers to enter into a labor relations advice agreement with its counsel prior to July 1, 2016 so as to take advantage of the significantly reduced and/or nonexistent disclosure requirements under the old persuader rule.

Click Here to open the Labor Relations Advice Representation Agreement that we have prepared.  To take advantage of the apparent loophole in the DOL's new "persuader" rule enforcement, we suggest that you execute the Agreement on or before July 1, 2016 and return it to me. 

 

 

NEWS ALERT:  Yesterday, a U.S. Federal Court in Lubbock, Texas has issued a nationwide-injunction barring the DOL from enforcing its Persuader Rule saying it threatens employers' rights to secure legal advice about union organization. 

Despite the Court's ruling, we still suggest that employer's execute the Labor Relations Advice Representation Agreement as a further protection.  The Lubbock court is in the Fifth Circuit and other courts may refuse to abide by the ruling.  Similar cases are pending in Minnesota and Arkansas.

If you have additional questions about this matter, please don't hesitate to contact ABC's Legal Counsel, Rick Bennett, his contact information is below.

Rick Bennett 

Farris Bobango Branan, PLC 

901-259-7100 phone 

rbennett@farris-law.com 

Sincerely,

Erin Murphy
President & CEO
Associated Builders & Contractors, West TN Chapter
1995 Nonconnah Blvd.
Memphis, TN 38132
www.wtcabc.org
www.abcmeritshopproud.org
www.abcvotes.com
 
Office: 901-794-9212
Fax: 901-794-9590
Cell: 901-601-7398  

 

 

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