Permanent Injunction Issued Against Persuader Rule
November 28, 2016
On November 16, 2016, a Texas federal judge issued a permanent nationwide injunction blocking the implementation and enforcement of the US Department of Labor’s “Persuader Rule.” In a June 29, 2016 Bullard Alert
, we discussed how the Persuader Rule would have expanded reportable activity under the Labor Management Reporting and Disclosure Act to include activity that “indirectly persuades” employees on their decisions regarding representation or collective bargaining rights. This expansion had the potential to disrupt the attorney client privilege between employers and their lawyers and complicate employers’ ability to secure legal advice if faced with a unionization effort. In the granting of the permanent injunction, the Texas judge referred to his initial ruling granting a temporary injunction, where he decided the rule would cause irreparable harm by preventing employers from obtaining “full, complete, un-conflicted legal advice and representation.”
With the permanent injunction in place, the Department of Labor is prohibited from implementing and enforcing the Persuader Rule nationwide, unless the judge in the case issues a contrary decision or the decision is reversed on appeal. Depending on the selection and direction of a new Secretary of Labor in the change of administration, there is a possibility that the appointee would instruct the Department of Labor to stop all litigation fighting the injunction. Consequently, it appears the persuader rule may be finished for at least the next four years.