“Persuader Rule” Blocked
As noted in previous Alerts, several lawsuits have been filed seeking to invalidate the U.S. Department of Labor’s (“DOL”) revised “persuader rule,” which would have imposed reporting obligations on a much wider range of activities. One of the cases is National Federation of Independent Business v. Perez, in the U.S. District Court in Lubbock, Texas. On Monday, the judge in that case issued a preliminary injunction enjoining the new rule, which was set to take effect on July 1, 2016.
The Labor Management Relations Reporting and Disclosure Act requires disclosures regarding persuader activities. The Act contains an advice exemption that applies when employers seek advice from counsel. The judge found that the new rule was “defective to its core” because it “entirely eliminates the advice exemption” that is contained in the law enacted by Congress.
The injunction is nationwide. So the new rule will not take effect on July 1, 2016 in any state.
The injunction is preliminary, which means that the case will continue. Given the time and effort the DOL expended in creating and issuing the new rule, it will certainly not be surprising if the agency continues to fight. So stay tuned. But for now, this is a great win for employers around the country.