Dive Brief:
- A key Labor Dept. rule that as of July 1 would have made organizing union campaigns easier has hit a legal roadblock, as earlier this week the U.S. District Court for the Northern District of Texas granted a nationwide preliminary injunction on the rule, according to various media outlets.
- With the "persuader rule" on hold, employers who look to use "indirect service providers" to communicate with employees in an effort to prevent them from forming unions can relax, according to SHRM.
- In its decision, the Texas court made note of the American Bar Association's specific opposition to the rule, which would require disclosure of confidential client information, such as the existence of the client-lawyer relationship, the identity of the client and other legal issues, including indirect persuasion services, according to SHRM.
Dive Insight:
In this specific case, the court ruled that the plaintiffs—the National Federation of Independent Business, the Texas Association of Business, the Lubbock Chamber of Commerce, the National Association of Home Builders and the Texas Association of Builders—had shown a likelihood of success on their claim that the rule exceeds the Labor Dept.'s authority by effectively eliminating the Labor-Management Reporting and Disclosure Act’s (LMRDA’s) “advice exemption," SHRM reports.
The rule would have imposed what employment attorneys and consultants consider to be onerous reporting requirements when they act as indirect persuaders for employers that are seeking to avoid unionization. Basically, reporting requirements under the rule could interfere with employers’ confidential relationship with them.
Phillip Wilson, president and general counsel for the Labor Relations Institute, a consulting firm based in Broken Arrow, OK, told SHRM that the persuader rule would mean “almost anything a consultant or lawyer helps to develop or plan that will communicate to employees about the exercise of their rights under the NLRA [National Labor Relations Act] could trigger a reporting requirement,” he said.
As of now, there are conflicting circuit court decisions on the rule, but even so, SHRM notes, the Texas' court's injunction leaves the rule's future cloudy. SHRM adds that the Labor Dept. may file an appeal to the U.S. Court of Appeals for the Fifth Circuit. Stay tuned.