Court Blocks DOL Persuader Rule

Employment Law

The U.S. District Court for the Northern District of Texas issued a nationwide preliminary injunction last week stopping the U.S. Department of Labor from implementing and enforcing its final persuader rule.  The rule, which was set to take effect on July 1, would have significantly expanded the reporting requirements for employers using outside labor counsel and consultants in union avoidance strategies to include those who merely provide advice rather than being fully engaged in implementing the strategy. The court found the challenge to the rule has a substantial likelihood of success on the merits and that the plaintiffs would be irreparably harmed if it was not enjoined.  This is now the second federal court to reach this conclusion, though the other court denied the injunction request.  A decision in a third court challenge to the rule could be issued later this month.  Although DOL is likely to appeal the injunction, the likelihood of eventually prevailing on the merits of the court challenges is improving with each court decision.