Client Alert

The Persuader Rules: Final Opportunity to Avoid Department of Labor Reporting Requirements

29 Jun 2016

The U.S. Department of Labor (“DOL”) recently issued its final regulations regarding the “advice exception” to reporting requirements of employers and lawyers under the Labor-Management Reporting and Disclosure Act. Prior to this revision, lawyers were only required by the Act to report their activities to the DOL when they personally communicated directly with employees concerning unionization or collective bargaining. The new revisions to the DOL regulations now require lawyers to report a broad range of labor relations advice and services they provide to employers for use in persuading employees about union issues, even if their advice or services do not involve direct personal communications with employees. The new regulations also require employers receiving such services to report them to the DOL. These reports detail the terms of the agreement between the employer and the lawyer and the fees paid for such services. The reports are public documents. The effective date of the new regulations is April 25, 2016.

Recently, an Assistant Director of the Department of Labor announced that this new rule will be applicable to arrangements and agreements between lawyers and employers that are made on or after July 1, 2016. The official also announced that agreements made prior to July 1, 2016, are not affected by the regulations.

Employers who are concerned about this possible disclosure of its communication with counsel to the DOL, and likely any union that goes to the DOL website to read the report, should consider entering into the type of agreement described before July 1, 2016. Morrison & Foerster has been following this development closely and has prepared an agreement which would allow us to continue to provide persuader information to an employer without violating the new regulation. If you would like further information regarding this issue, please contact Tim Ryan, Lloyd Aubry, or Eric Tate, whose contact information appears below.

Timothy Ryan
(213) 892-5388
tryan@mofo.com

Lloyd Aubry
(415) 268-6558
laubry@mofo.com

Eric Tate
(415) 268-6915
etate@mofo.com

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