What to Know About the Persuader Advice Exemption Rule

Date: March 15, 2016

Louisiana Attorney General Jeff Landry part of coalition opposing labor rule.

What to Know About the Persuader Advice Exemption Rule

In 2015, the Department of Labor’s Office of Labor Management Standards proposed a rule that would significantly hamper small businesses’ ability to consult with a lawyer on labor issues. Thankfully for Louisiana small businesses, Attorney General Jeff Landry is working with twelve other AGs to stop this rule from taking effect.

The proposal, called the Persuader Advice Exemption Rule, would force lawyers and law firms that counsel a small business on labor relations matters to disclose their work with that client, as well as all fees and arrangements for all clients seeking labor relations services. This move would undermine the longstanding protection over the confidentiality of attorney-client communications and place an unfair burden on small business owners. Small businesses, after all, are the ones who need to hire outside counsel when an issue arises because they cannot afford to keep an attorney on staff. If this rule is enacted, it’s likely that many lawyers will stop taking on the clients—small businesses—who come to them for labor relations counsel.

The proposed rule would also bring legal advice under the Department of Labor’s “persuader” regulations concerning engagement in the unionization process. Currently legal counsel falls outside those rules, as long as the attorney doesn’t engage with workers and the small business owner is free to either accept or reject the legal advice offered. But if the rule is enacted, any lawyer offering advice to small business owners would be subject to these persuader rules.

“This new persuader rule is a perverse attempt to tilt the playing field,” wrote Dawn Starns, NFIB’s Louisiana state director, in an op-ed for Biz Magazine. “Small business owners still find themselves at a serious disadvantage when dealing with the unions. Just a few years ago, the National Labor Relations Board shortened the minimum time from the start of a union organizing campaign to the election to just 13 days. That’s not a lot of time to engage a lawyer and get educated on the process.”

NFIB supports Jeff Landry and the rest of the attorney general coalition standing up for small businesses, and the NFIB Small Business Legal Center is also urging the Department of Labor to reconsider the rule change.

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