To quote the controversial Marshall Mathers, otherwise known as Eminem:
Guess who’s back, back again?
The DOL’s back, with a friend.
Guess who’s back, guess who’s back,
Guess who’s back, guess who’s back.
Guess who’s back, guess who’s back.
Much to the surprise of many employers, the DOL recently submitted their proposed new rules regarding what constitutes “persuader” activity for the purposes of the Labor Management Reporting and Disclosure Act (“LMRDA”) to the Office of Management and Budget (“OMB”). This move by the DOL is significant (and alarming) because submission of a proposed rule to the OMB is the final step before the DOL can publish its final rule in the Federal Register. The DOL currently has a target date of March 2016 for publication of its final rule. In other words, the new persuader rules could become a reality in just three short months (or even less).
The proposed persuader rules have been rather dormant since 2011, when introduction of the rules sparked major controversy and the American Bar Association strongly opposed the rules because they could potentially violate the sanctity of the attorney-client privilege. This latest move by the DOL, however, means that the rules could take effect despite the objections of the ABA.
The proposal issued by the DOL would expand the scope of an employer’s reporting requirements under the LMRDA. Currently, the LMRDA contains an exemption for where an employer receives “advice” from an attorney or consultant, but the attorney or consultant does not have direct contact with any employees. Under the proposed rule, “persuader activity” would be expanded to include “material or communications to, or engaging in other actions, conduct, or communications on behalf of an employer that, in whole or in part, have the object directly or indirectly to persuade employees concerning their rights to organize or bargain collectively. Reporting is thus required in any case in which the agreement or arrangement, in whole or in part, calls for the consultant to engage in persuader activities, regardless of whether or not advice is also given.” This broad definition of “persuader activity” would severely narrow the “advice” exemption as we currently know it. For instance, the DOL has provided the following examples of what would constitute persuader activity:
- Drafting, revising, or providing a persuader speech, written material , website content; audiovisual or multimedia presentation, or other material or communication of any sort to an employer for presentation, dissemination, or distribution to employees, directly or indirectly;
- Planning or conducting individual or group meetings designed to persuade employees;
- Developing or administering employee attitude surveys concerning union awareness, sympathy, or proneness;
- Training supervisors or employer representatives to conduct individual or group meetings designed to persuade employees;
- Coordinating or directing the activities of supervisors or employer representatives to engage in the persuasion of employees;
- Establishing or facilitating employee committees;
- Deciding which employees to target for persuader activity or disciplinary action;
- Coordinating the timing and sequencing or persuader tactics and strategies.
The DOL also stated that reportable agreements or arrangements include those in which a consultant plans or orchestrates a campaign or program to avoid or counter a union organizing efforts, such as through the specific activities listed above. Additionally, such efforts could also include drafting or implementing policies for an employer that has the effect of directly or indirectly persuading employees.
Any employer who enters into an agreement with an outside party – such as an attorney or consultant – to provide “persuader activity” would be required to file Form LM-21 with the DOL. Failure to comply with the LMRDA’s reporting requirements could technically result in a $10,000 fine and imprisonment for up to one year.