New DOL Persuader Requirements Effective July 1, 2016

More detailed reporting will now be required for both employers and their attorneys related to an employer’s “persuader” activities (See 29 C.F.R. Parts 405 and 406).  “Persuader activities” are defined as “any actions, conduct, or communications that are undertaken with an object, explicitly or implicitly, directly or indirectly, to affect an employee’s decisions regarding his or her representation or collective bargaining rights.”  Form LM-10 Employer and Form LM-20 Consultant Persuader Reporting under the LMRDA, U.S. Department of Labor, Office of Labor-Management Standards Jul. 1, 2016, available at (https://www.dol.gov/olms/regs/

compliance/ecr.htm#ecr).

 

As anticipated, the Department of Labor published revisions to the persuader reporting regulations on March 24, 2016, which took effect on July 1, 2016.  The original requirements were established under the Labor Management Reporting and Disclosure Act, and required employers and their labor consultants to disclose when they engage in persuader activity by filing reports with the DOL regarding the use of consultants related to such activity. Labor-Management Reporting and Disclosure Act of 1959, As Amended, §203(b)(1).  However, the previous rule was often superseded by the “advice exception” which allowed consultants and attorneys who did not communicate directly with employees regarding their collective bargaining advice to avoid many of the DOL reporting guidelines.

 

Under the amended regulations, the advice exception has been significantly narrowed and compels consultants and attorneys who persuade employees, directly or indirectly, regarding employees’ collective bargaining rights to file extensive reports with the Department of Labor Office of Labor-Management Standards. Id.  Pending final approval of the amended regulations, many were concerned the new reporting requirements would waive attorney-client privilege.  Following publication of the Final Rule, the DOL has stated the new reporting requirements do not encroach on information subject to attorney-client privilege.  Persuader Agreements:  Ensuring Transparency in Reporting for Employers and Labor Relations Consultants, U.S. Dept. of Labor, available at (https://www.dol.gov/olms/regs/compliance/

ecr/Persuader_OverviewSum_508_2.pdf). Even so, the new regulations require the attorney to disclose the “identity of the client, the fee arrangement, and scope and nature of the persuader agreement in cases where the consultant has agreed to provide services other than legal services . . .”    Id.

As the new regulations extend to all employees requesting information about and/or exercising their collective bargaining rights, even small employers with union interaction should consult legal counsel about their persuader reporting obligations to the DOL.