Court Issues Permanent Injunction Blocking Labor Department's "Persuader Rule"

A federal district court on November 16 issued a nationwide permanent injunction preventing implementation of the U.S. Department of Labor's (DOL) persuader rule.”  The ruling is good news for employers and for the associations, attorneys, and consultants that advise them on labor matters.

The “persuader” rule expands the reporting obligations of labor relations “consultants” (which is defined to include attorneys and associations) who conduct activities to persuade employees about their rights to join a union or bargain collectively as well as the reporting obligations of employers who receive assistance from such consultants.  The rule is expected to have a substantial chilling effect on employers’ willingness and ability to seek needed advice from experts.  For more information on the current regulations and the changes imposed by the new rule, click here.

The U.S. District Court for the Northern District of Texas, Lubbock Division, ordered the permanent injunction while granting the plaintiffs’ motion for summary judgment in the case National Federation of Independent Business v. Perez.  The court previously issued a preliminary injunction in the case in June.  The court then found that the rule:  is arbitrary, capricious, and an abuse of discretion; violates constitutional rights to free speech and association; violates the Fifth Amendment’s due process clause as overly vague; and violates the Regulatory Flexibility Act.  The court adopted the same reasoning when it converted the preliminary injunction into a permanent one.

DOL filed an appeal of the preliminary injunction and could choose to appeal the permanent injunction.  However, the outcome of the presidential election diminishes the likelihood of appeal.  At this point, the relevant reporting obligations remain as they have been for many years, without the expansion attempted by the invalidated rule.

The case is one of three lawsuits challenging the rule in different courts.  AGC, as a member of the Coalition for a Democratic Workplace, is a plaintiff in one of the other cases.  AGC is also a member of the U.S. Chamber, which submitted amicus briefs in all three cases.

For more info, contact Denise Gold, Associate General Counsel, at or (703) 837-5326.

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