NAHB’s Legal Victory Blocks ‘Persuader’ Rule

Filed in Codes and Standards, Labor, Legal by on November 16, 2016 1 Comment

hardhatgavelNAHB scored a major legal victory today when the U.S. District Court for the Northern District of Texas granted the association and other groups a permanent stay on the Department of Labor’s final “persuader” rule.

The rule would unfairly discourage employers from receiving confidential legal advice concerning union organizing because it required employers to disclose the names of lawyers and consultants to the Department of Labor (DOL).

In short, unions were seeking to prevent employers from talking to their lawyers in response to union organizing. The court ruling essentially puts an end to the union effort.

NAHB, along with the Texas Association of Builders, the National Federation of Independent Business and Texas business groups brought this case against DOL when the rule was finalized in March 2016. The persuader rule was intended to take effect July 1, but the groups secured a preliminary injunction against the rule before it took effect.

NAHB has two distinct concerns about the persuader rule. First, the rule would likely impair NAHB members’ access to qualified labor-relations attorneys by driving attorneys out of labor-relations practice. The threat of public reporting could also cause employers to be reluctant to seek legal advice on union concerns.

Second, trade associations like NAHB may be deemed “consultants” if they hold educational programs concerning unions or other labor-related activities which require them to report their seminars and attendees to DOL. The vagueness of the persuader rule makes it impossible to know which of a trade association’s activities or events must be reported under the rule.

With the permanent judgment now in place, the persuader rule will not go into effect unless DOL appeals and a higher court overrules the lower court decision.

For more information, please contact Amy Chai at 800-368-5242 x8232 or Suzanne Beall at x8407.

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