Employment Law Daily Senate resolution would block implementation of DOL ‘persuader rule’
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Tuesday, June 14, 2016

Senate resolution would block implementation of DOL ‘persuader rule’

By Pamela Wolf, J.D. Sticking to a playbook that has so far yielded no success, Senate Republicans have introduced a resolution that would halt implementation of the Labor Department’s controversial "persuader rule." Under the Congressional Review Act, the House and Senate may vote on a joint resolution of disapproval to stop, with the full force of law, a federal agency from implementing a rule or regulation or issuing a substantially similar regulation without congressional authorization. Similar to the joint resolution to bar the implementation of the DOL’s fiduciary rule vetoed by President Obama on June 8 (or to beat back the NLRB’s "quickie election" rule, enacted in 2015), S.J. Res. 35, introduced on June 10 by Senators Jeff Flake (R-Ariz.) and Lamar Alexander (R-Tenn.), would register congressional disapproval of the persuader rule and render it without force or effect. Changes in "persuader" reporting. The final persuader rule, published in the Federal Register on March 24, 2016, revised two public disclosure reporting forms: Form LM-10 (employer report) and the Form LM-20 (agreement and activities report). Generally, with some exceptions, these reports must be filed when an employer and a labor relations consultant make an arrangement or an agreement that the consultant will undertake efforts to persuade the employer’s workers to reject an organizing campaign or collective bargaining effort by a union. The rule requires disclosure of these items for advice provided after June 30, 2016. Under the controversial changes made by the final rule, an employer-consultant agreement is reportable if a consultant engages in "persuader activities." These 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." Under a typical reportable agreement or arrangement, a consultant agrees to manage a campaign or program to avoid or counter a union organizing or collective bargaining effort, either jointly with the employer or separately. Under the DOL’s prior interpretation of Section 203(c), the employer and consultant would be required to file a report only if the consultant communicated directly to the workers. The final rule requires that both direct and indirect activities must be reported. In addition, the final rule mandates that consultants must also file reports when they hold union avoidance seminars for employers. However, employers are not required to report simple attendance at these seminars. Controversy over rule’s impact. Announcing the Senate resolution to block the persuader rule, Flake and Alexander pointed to a former DOL chief economist who concluded the rule would cost businesses billions of dollars in compliance costs. The lawmakers said those costs would restrict the ability of businesses to access legal advice and limit the availability of information that workers need to make an informed decision on whether or not to join a union. Moreover, the rule purportedly infringes on First Amendment free rights, a claim under litigation in federal courts. "Eliminating this flawed rule will protect businesses from mandates designed to create an uneven playing field in favor of unions and will prevent yet another layer of economically-crushing regulatory burden on small businesses," said Flake. Those who have argued in support of the persuader rule have pointed out that in the absence of the transparency demanded by the rule, employees might believe that their supervisors’ arguments against the union were based on personal opinion rather than a well-orchestrated employer campaign developed by a third-party consultant (much like the "third-party interloper" that employers often call unions). House resolution. On May 18, the full House Committee on Education and the Workforce marked up Representative Bradley Byrne’s (R-Ala.) joint resolution (H.J. Res. 87) to disapprove the persuader rule. It also states simply that Congress disapproves the rule and it "shall have no force or effect." Quickie election rule resolution killed. Using the Congressional Review Act in an attempt to block regulations that Republican lawmakers disfavor is not new. Last year, on March 31, 2015, Obama used a pocket veto to send a joint resolution back to Congress that would have blocked implementation of the Labor Board’s revised union representation procedures, dubbed the "quickie election" rule by opponents. On Tuesday, May 5, Senators voted 96 to 3 to table the veto message, which had little chance of garnering the two-thirds majority necessary to override the president’s veto.

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