Yesterday a Department of Labor spokesman informed Bloomberg BNA that its final rule regarding the “advice exception” to the so-called “persuader rule” in the Labor-Management Reporting Disclosure Act of 1959 (LMRDA) will not be issued in March as announced back in November, 2013. According to the article, the DOL spokesman provided no details for the postponement or on when the final rule will be published:
“As with all rules, the department intends to take the time to get it right rather than meet arbitrary deadlines,” the spokesman said. “The next [regulatory] agenda will have a new date” for the publication of the final form of the rule, he said.
As we noted in December, it is believed by some that the DOL needs more time to bolster the rule against potential legal challenges. Critics of the rule claim that the proposed rule is improper because it effectively writes the advice exception out of the statute. Moreover, the American Bar Association and the Association of Corporate Counsel assert that the proposed rule is also inconsistent with the rules of professional conduct pertaining to lawyer-client confidentiality. They and others believe that the proposed rule forces lawyers to disclose privileged attorney-client information and that it will discourage employers from seeking legal assistance during union organizing campaigns.
However, further postponement has the potential to undermine the DOL's efforts to publish the new rule altogether. Given that the DOL has not set a new date for publication, it seems plausible that the new rule might be placed on the "back burner" until sometime after the mid-term elections this November.
Nevertheless, because the proposed rule has significant monetary and legal implications for employers, employers should continue to prepare for the expected rule change by evaluating their options for compliance and/or challenging the new rule once it is published. Importantly for federal contractors, the postponement does not affect their obligation to comply with Executive Order 13494.