Search form

Labor Department: Changes to Interpretation of Advice Exemption Apply Only to Agreements, Arrangements Entered Into After July 1

By Philip B. Rosen, James A. Prozzi and Daniel D. Schudroff
  • April 22, 2016

The United States Department of Labor published its final rule relating to “persuader” activity under the Labor-Management Reporting and Disclosure Act on March 24, 2016. Under the DOL’s new interpretation, employers/clients as well as consultants/attorneys would be required to report to the DOL all arrangements in which an “object” (directly or indirectly) of the services provided by the consultant/attorney is to persuade employees about the manner of exercising the employees’ “right to organize and bargain collectively through representatives of their own choosing” under federal labor law. (For details, see our article, DOL’s Rule Redefining LMRDA ‘Advice Exception’ and Expanding Types of Activities Considered Persuasive, Reportable is Finalized – Effective Late April 2016.)

The final rule is to take effect on April 25, 2016. Nevertheless, the final rule stated that it would be applicable only to arrangements and agreements (and payments associated therewith) entered into on or after July 1, 2016. It was unclear whether the final rule would require reporting for arrangements and agreements entered into between April 25, 2016, and July 1, 2016, if the payment was made after July 1.

The DOL has clarified its position on this issue. In connection with one of the lawsuits against the DOL challenging the overall validity of the final rule, the agency in a status report filed with the court stated:

The Department will not apply the Rule to arrangements or agreements entered into prior to July 1, 2016, or payments made pursuant to such arrangements or agreements. Consequently, under the Rule no employer, labor relations consultant, or other independent contractor will have to report or keep records on any activities engaged in prior to July 1 that are not presently subject to reporting, or file the new Forms LM-10 or LM-20 (revised pursuant to the Rule) for any purpose prior to July 1.

Jackson Lewis will continue to monitor and provide updates as new information becomes available on the rule and the lawsuits challenging its validity. We provide clients with the full range of workplace law advice and representation, including on any matters under the National Labor Relations Act. If you have questions about the new rule or any related matters, please contact the attorneys listed or the Jackson Lewis attorney with whom you regularly work.

©2016 Jackson Lewis P.C. This material is provided for informational purposes only. It is not intended to constitute legal advice nor does it create a client-lawyer relationship between Jackson Lewis and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material. This material may be considered attorney advertising in some jurisdictions. Prior results do not guarantee a similar outcome.

Reproduction of this material in whole or in part is prohibited without the express prior written consent of Jackson Lewis P.C., a law firm that built its reputation on providing workplace law representation to management. Founded in 1958, the firm has grown to more than 900 attorneys in major cities nationwide serving clients across a wide range of practices and industries including government relations, healthcare and sports law. More information about Jackson Lewis can be found at www.jacksonlewis.com.

See AllRelated Articles You May Like

September 17, 2019

Access to Private Property: Labor Board Rules Girl Scout Cookies and Union Protesters are Different

September 17, 2019

A nonemployee’s solicitation for charitable or civic causes on an employer’s property is not the equivalent of a nonemployee union representative’s engaging in a protest soliciting customers to boycott an employer or in union organizing on the property, the National Labor Relations Board (NLRB) has held. Kroger Limited Partnership, 368... Read More

September 13, 2019

Top Five Labor Law Developments for August 2019

September 13, 2019

The National Labor Relations Board (NLRB) found an employer did not violate the National Labor Relations Act (NLRA) by misclassifying its employees as independent contractors. Velox Express, Inc., 368 NLRB No. 61 (Aug. 29, 2019). Velox engaged drivers classified as independent contractors to transport medical samples to hospitals and... Read More

September 12, 2019

Labor Board Adopts ‘Contract Coverage’ Standard in Unilateral Change Cases, Overturns Precedent

September 12, 2019

The National Labor Relations Board (NLRB) has made it easier for employers to defend against unfair labor practice charges alleging a unilateral change in violation of the National Labor Relations Act (NLRA). As suggested by Chairman John Ring and Member Marvin Kaplan in E.I. du Pont de Nemours & Co., 368 NLRB No. 48 (Sept. 4,... Read More

Related Practices