DOL Issues New Rule Requiring Employers to Disclose Third-Party Consultants That Create Anti-Union Materials

 
Friday, March 25, 2016
 

Many employers commonly engage third-party consultants in creating and delivering anti-union messages to workers. Workers often do not know when employers engage consultants behind the scenes to influence their decisions.

A new rule from the U.S. Department of Labor will require reporting of employer-consultant, or “persuader” agreements – to complement the information that unions already report on their organizing expenditures, resulting in better information for workers making decisions on whether or not to form a union or bargain collectively.

The new rule interprets Section 203 of the Labor Management Reporting and Disclosure Act. The law requires labor organizations, consultants, and employers to file reports and disclose expenditures on labor-management activities. The law intends to prevent abuse, corruption, and improper practices by labor organizations, employers, and labor relations consultants alike.  

A longstanding loophole, however, allows employers to hire consultants to create materials, strategies and policies for organizing campaigns – and even to script managers’ communications with employees – without disclosing anything, as long as the consultant does not directly contact employees. The new rule closes the loophole to align the regulation with the statute, by requiring reporting on “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 the same statute, unions already are required to make comprehensive public reports on their expenditures, including expenditures on union-organizing campaigns.

The Federal Register published the new rule on March 24. The change will be applicable to arrangements, agreements, and payments made on or after July 1, 2016.

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