Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘persuader rule’

A Dark Veil

Friday, July 20th, 2018

The Trump administration on Tuesday rescinded the Department of Labor’s “persuader rule” requiring companies to disclose any consultants or lawyers contracted for anti-union persuasion efforts. The most recent in a series of anti-worker regulatory rollbacks, the decision has drawn harsh condemnation from union leaders and working people.

When the Labor Department issued the rule in 2016, it was hailed as a win for workplace transparency. Workers would have the right to know when their bosses hired outside union-busters to influence organizing decisions.

Then-Secretary of Labor Tom Perez explained it would “ensure that workers have the information they need to make informed decisions about exercising critical workplace rights….Informed decisions are the best decisions.”

In the wake of Tuesday’s announcement, AFL-CIO National Media Director Josh Goldstein slammed the administration’s decision to shield the “sinister practices of employers and their hired guns.”

“By repealing the persuader rule, the Department of Labor is siding with corporate CEOs against good government and transparency,” Goldstein said. “They have thrown a dark veil over the shady groups employers hire to take away the freedoms of working people.”

This blog was originally published at the AFL-CIO on July 19, 2018. Reprinted with permission. 

2017 was a year of eroding workers’ rights

Thursday, December 28th, 2017

There have been a series of victories for labor rights in recent years. Graduate student workers at private colleges and universities now have the right to unionize. In New York, employers are no longer allowed to ask for an employee’s salary history — a question that often hurts women and people of color. And the Fight for 15 has scored wins in cities across the country.

But the Trump administration stands in the way of much of the progress labor activists are demanding. It may not be as noisy or ripe for attention-grabbing headlines as Betsy DeVos’ education department or Scott Pruitt’s Environmental Protection Agency, but Alexander Acosta’s labor department has rolled back a number of key Obama-era labor advances.

“Acosta is not a bomb-thrower,” said Jeffrey Hirsch, law professor at University of North Carolina at Chapel Hill. Unlike some of Trump’s other less traditional choices for agency heads, Acosta had already been confirmed by the Senate for three previous positions and was considered a safe choice for labor department secretary.

Still, it’s clear the department is now under a Republican administration.

The National Labor Relations Board (NLRB), which enforces fair labor practices, has an employer-friendly majority. The General Counsel of the NLRB is Peter Robb, a lawyer who management-focused firm Jackson Lewis wrote would “set the stage for the board to reverse many of the pro-labor rulings issued by the Obama board”. The Senate also confirmed to the NLRB William Emanuel, whose nomination was supported by corporate donors and industry groups like the National Retail Federation, U.S. Chamber of Commerce, and National Restaurant Association. Emanuel’s work previous focused on union avoidance tactics and among his former clients were Amazon, Target, Uber, and FedEx.

With these new additions, the Department of Labor has been busy dismantling protections for workers. Here are some of the biggest ways the Trump administration rolled back workers’ rights in 2017:

Less accountability for corporations like McDonald’s

One of the labor rollbacks that gained the most attention this year was the board’s decision to overturn the new joint employer standard that was supposed to make it easier for corporations to be held accountable for unfair labor practices at their franchises. Labor advocates expected the decision for some time after the department rescinded guidance that defines who a joint-employer is.

The Obama administration’s standard on joint employers went beyond simply looking at who sets wages and hires people, and considered a worker’s “economic dependency” on the business. McDonald’s has tried to avoid responsibility for violations like wage-theft for years. In 2016, McDonald’s settled a wage-theft class action and released a statement that said it “reconfirms that it is not the employer of or responsible for employees of its independent franchisees.”

“Under the previous rule, you only needed to show [McDonald’s] had a theoretical amount of control. They reserve the right to control terms and conditions of work and controlled those conditions in an indirect manner like setting policies that other companies have to follow,” Hirsch explained. “The new case has said that no, you need actual direct control. When push comes to shove, it’s a matter of evidence and how much proof you have, so you may well still have a case against McDonald’s but you’re going to have to show that there is more actual control.”

Reduced protections for quality investment advice

In August, the Labor Department said it would like to delay a rule that would require financial advisors to act in the best interest of their customers and their retirement accounts. According to a federal court filing, the department wanted to delay implementation of the rule to July 2019. The full implementation of the rule is currently set for January 2018.

There are two standards investors have to be aware of right now: the fiduciary standard and suitability standard. A financial adviser operating under what is called the “suitability standard” is only required to make sure a client’s investment is suitable for the client’s finances, age, and risk tolerance at that point in time, but they don’t have a huge legal obligation to monitor the investment for the client. Under the fiduciary standard, an adviser must keep monitoring the investment and keep the customer’s overall financial picture in mind. In addition, advisers must disclose all of their conflicts of interest, fees, and commissions under the fiduciary standard. Right now, it’s easier for advisers to push investments that will make them money but are not necessarily in clients’ best interest, said Paul Secunda, professor of law and director of the labor and employment law program at Marquette University Law School.

“That rule has been substantially cut back, though how far back we’re still waiting to see. The current admin is in a holding pattern right now and my sense is that it could be cut back fairly dramatically even further,” Secunda said.

None of these labor department actions have been good enough for the financial industry, however. Plaintiffs in a lawsuit that included the Securities Industry and Financial Markets Association, the Financial Services Institute, the Financial Services Roundtable and the U.S. Chamber of Commerce, sent a Dec. 8 letter to the U.S. Court of Appeals for the Fifth Circuit. The plaintiffs said the delay of regulation shouldn’t hold up their appeal, where they argue the department does not have the authority to promulgate the rule, according to InvestmentNews.

Reduced worker safety

Experts on labor violations and the Occupational Safety and Health Administration told ThinkProgress they were concerned about how OSHA would respond to Hurricanes Harvey and Irma, especially since the Trump administration has slashed worker safety rules from the Obama administration. 

Trump’s OSHA has left behind regulations on worker exposure to construction noise, combustible dust, and vehicles backing up in factories and construction sites, according to Bloomberg BNA. It also abandoned a rule that would change the way the agency decides on permissible exposure limits for chemicals. The July regulatory agenda did not list any new rule-making. The president’s 2018 budget would have killed OSHA’s Chemical Safety Board, which looks into chemical plant accidents, as well as the Susan Harwood grant program, which benefits nonprofits and unions that provide worker safety training.

“OSHA is taking a turn we usually see during Republican administrations, which means a lot less inspections and enforcement and a lot more trying to get employers to self-regulate or voluntarily comply which has not really worked that well historically,” Secunda said. “People who participate in these voluntary participation programs are usually employers who are already in compliance and those who continue to be bad actors are not really impacted by these voluntary programs. OSHA is about to be run by corporate America, which is obviously not good for employees.”

Deciding to let go of Obama-era overtime rule

In July, the labor department moved to roll back an Obama administration rule that would have expanded the number of workers eligible for overtime pay by 4.2 million. The department has not appealed a U.S. District Court in Texas that gave business groups the temporary injunction they wanted.

The current threshold for overtime pay is at just $23,660 a year, and the Obama-era rule would have nearly doubled that. In 1974, 62 percent of full-time salaried workers had a salary that allowed them to be eligible for overtime, but today, only 7 percent of full-time salaried workers earn a salary below this level, according toDavid Weill, dean of the Heller School for Social Policy and Management at Brandeis University who headed the Wage and Hour Division of the department during the Obama administration.

Referring to Acosta, Weill wrote in U.S. News, “Failure to appeal this flawed decision will leave millions working long hours with low pay and abrogate his responsibility to protect the hardworking people he and the Trump administration profess to care so much about.”

Labor department focus on ‘harmonious workplaces’

In one of the NLRB’s less discussed decisions this month, it overruled the Bush-era standard Lutheran Heritage Village-Livonia. This standard went into further detail on whether facially neutral workplace rules, policies, and handbook provisions could unlawfully interfere with Section 7 of the National Labor Relations Act. (Under Section 7, it’s unlawful for employers to interfere with employees’ organizing rights.) The NLRB provides the example of employers threatening, interrogating, or spying on pro-union employees or promising employees benefits if they stay away from organizing as unlawful activity under Section 7.

Under the 2004 standard, employers could have the violated the National Labor Relations Act by instituting workplace rules that could be “reasonably construed” to prohibit workers from accessing these rights even if the employers don’t explicitly prohibit the activities.

Hirsch said he was surprised by the decision to reverse a Bush-era decision. “To me, it seems like they’re doing more than they needed to, which makes me wonder if they’re trying to make a point.”

Hirsch added that the decision appeared to carve out certain types of rules, such as a civility code in the workplace, and say they were permissible. The decision referred to employers who wanted “harmonious workplaces” and cast any opposition to such a requirement to be impractical, but Hirsch said there needs to be a balance in NLRB decisions between clarity and flexibility.

“That can be problematic bevause they’re rules that depending on the history of what has happened in that particular workplace and it could actually be viewed as fairly chilling for those employees,” Hirsch said. “… Labor and management relations aren’t always harmonious. In fact, they are designed not to be in a  lot of ways. Sometimes harsh language is used by both sides and sometimes that is OK, or we’re willing to tolerate that as part of the collective bargaining process rather than having violent strikes, like we did before the NRLA.”

‘Micro-unions’ are out of luck

The NLRB made another business-friendly decision this month when it decided that a unionized group of 100 welders and “rework specialists” at a manufacturing company with thousands of workers was improper. This means it will be easier for employers to oppose what are referred to as “micro unions” even though it can be advantageous for workers to organize this way. The decision went against eight federal appeals court rulings, according to Reuters.

LGBTQ workers’ not protected by Title VII

There is ongoing debate over whether LGBTQ workers have rights to ensure that they are treated fairly in the workplace under Title VII, part of the Civil Rights Act of 1964. Title VII prohibits employers from discriminating against employees on the basis of sex, race, color, national origin, and religion. In July, the Department of Justice undermined rights for LGBTQ people when it filed a brief arguing that prohibition of sex discrimination under federal law does not include the prohibition of discrimination on the basis of sexual orientation.

Tell the Labor Department Not to Repeal the Persuader Rule

Monday, June 19th, 2017

The Labor Department issued a proposal on Monday that would rescind the union-buster transparency rule, officially known as the persuader rule, designed to increase disclosure requirements for consultants and attorneys hired by companies to try to persuade working people against coming together in a union. The rule was supposed to go into effect last year, but a court issued an injunction last June to prevent implementation. Now the Trump Labor Department wants to eliminate it.

We wrote about this rule last year. Repealing the union-buster transparency rule is little more than the administration doing the bidding of wealthy corporations and eliminating common-sense rules that would give important information to working people who are having roadblocks thrown their way while trying to form a union.

AFL-CIO spokesman Josh Goldstein said:

The persuader rule means corporate CEOs can no longer hide the shady groups they hire to take away the freedoms of working people. Repealing this common-sense rule is simply another giveaway to wealthy corporations. Corporate CEOs may not like people knowing who they’re paying to script their union-busting, but working people do.

If the rule is repealed, union-busters will be able to operate in the shadows as they work to take away our freedom to join together on the job. Working people deserve to know whether these shady firms are trying to influence them. The administration seems to disagree.

A 60-day public comment period opened Monday. Click on this link to leave a comment and tell the Labor Department that we should be doing more to ensure the freedom of working people to join together in a union, not less. Copy and paste the suggested text below if you need help getting started:

“Working people deserve to know who is trying to block their freedom from joining together and forming a union on the job. Corporations spend big money on shadowy, outside firms that use fear tactics to intimidate and discourage people from coming together to make a better life on the job. I support a strong and robust persuader rule. Do not eliminate the persuader rule.”

About the Author: Kenneth Quinnell is a long-time blogger, campaign staffer and political activist.  Before joining the AFL-CIO in 2012, he worked as labor reporter for the blog Crooks and Liars.  Previous experience includes Communications Director for the Darcy Burner for Congress Campaign and New Media Director for the Kendrick Meek for Senate Campaign, founding and serving as the primary author for the influential state blog Florida Progressive Coalition and more than 10 years as a college instructor teaching political science and American History.  His writings have also appeared on Daily Kos, Alternet, the Guardian Online, Media Matters for America, Think Progress, Campaign for America’s Future and elsewhere.

Judge’s Ruling Re-Opens a Major Loophole that Allows Union Busters To Remain in the Shadows

Thursday, July 7th, 2016

photo_321703[1]Earlier this year, the U.S. Department of Labor (DOL) passed the “persuader rule” that closed a major loophole, which has for decades allowed employers to hire attorneys and consultants to secretly assist them in what is politely referred to in the industry as “union avoidance.” The goal of this activity is to persuade and prevent workers from organizing unions.

The new rule did not try to make the consultants’ and attorneys’ practices illegal, or regulate the types of activities that employers and consultants could engage in; it was simply intended to provide transparency to workers who are the subject of a coordinated anti-union campaign. But last week, a Texas federal district court judge issued a nationwide injunction prohibiting the DOL from implementing the rule.

The persuader rule reinterpreted the “advice” exemption in Section 203(c) of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), which had only required disclosure when employers hired outside consultants who directly communicated with employees. Under the previous interpretation of the exemption, the vast majority of employers who hire labor consultants—sometimes referred to as “union busters”—and the consultants they hire have been able to evade their filing requirements and remain in the shadows by having these consultants work behind the scenes.

As a result, the workers are never privy to who is coordinating the anti-union campaign or how much their employers are spending on it. It is estimated that employers in 71-87 percent of organizing drives hire one or more consultants, yet because of the massive loophole in the law, only 387 agreements were filed by employers and consultants.

The LMRDA was passed to deal with the persistent problem of employers’ interference with workers’ rights to organize. A 1980 Congressional Sub-Committee Report described the long history of employers using

outside assistance to combat union organizing efforts since well before federal legislation to regulate labor-management conflict was enacted. Private detectives and ”professional goons” were hired by employers, who were also assisted by law enforcement personnel. Anti-union tactics included spying, blacklisting, firing, physical intimidation, violence, and jailings.

Twenty years earlier, in the Final Report preceding the passage of the LMRDA, Congress that the outside “spy” and “professional goons” had morphed, and “a new and more sophisticated outsider had appeared: the ‘labor relations consultant.’ ” As a result, the 1959 Act required employers and any consultants they hired to file a report if they made any arrangements or spent any money “to interfere with, restrain, or coerce employees in the exercise of the right to organize and bargain collectively through representatives of their own choosing.”

The new persuader rule, which covers all agreements and payments after July 1, was intended to close this loophole. The rule requires employers who hire anti-union consultants (and those consultants hired) to disclose to the DOL the agreement and the amounts paid. It would not require disclosure of what the consultants said or any legal advice sought. It is akin to a requirement that political campaign ads disclose who is paying for the ad so that people know who is behind the message they are receiving.

But now, under last week’s injunction, all of that is in jeopardy.

“This was one of the most one-sided orders I have ever seen,” explains Seattle University School of Law Professor Charlotte Garden. “The court found every one of the theories brought by the plaintiffs likely to succeed.”

The suit was brought by the National Federation of Independent Business, the Texas Association of Business, the Lubbock Chamber of Commerce, the National Association of Home Builders, the Texas Association of Builders, and a group of GOP-controlled states. Some of these organizations were concerned that their current activities of providing anti-union seminars and materials would require them to file reports identifying themselves as labor relations consultants.

Perhaps the most surprising group to take a side in this case was the American Bar Association (ABA), whose mission is “To serve equally our members, our profession and the public by defending liberty and delivering justice as the national representative of the legal profession.” The ABA cited attorneys’ ethical rules for their opposition to the DOL Rule, and said, “by imposing these unfair reporting burdens on both the lawyers and the employer clients they represent, the proposed Rule could very well discourage many employers from seeking the expert legal representation they need, thereby effectively denying them their fundamental right to counsel.”

This coalition of business and attorney groups and states brought forward a number of arguments, from the DOL lacking authority to pass the rule to the rule exceeding the DOL’s estimated compliance costs by $59.99 billion over 10 years. (The DOL estimated the rule would cost all employers and consultants a total of approximately $826,000 per year; the plaintiffs estimated it at $60 billion over 10 years.) Additionally, in line with the growing use of the First Amendment against government regulation of business, the plaintiffs argued that the rule violated the employers’, lawyers’, and consultants’ free speech, expression and association rights. The Judge concluded that some union busters may not offer their services as freely, and some attorneys may leave the field, if their identities and the terms of their arrangements were disclosed.

There is a great dissonance to the judge’s extreme sensitivities to the rights of lawyers, union busters and employers to have their anti-union activities shrouded in complete secrecy, when the new rule was intended to protect workers’ rights. Not mentioned anywhere in the judge’s 86-page order is any discussion of workers’ rights to know who is really speaking to them when they are forced to sit in on an anti-union captive audience meeting. Further, there is no discussion of the value to workers of being able to test the employer’s claim that it does not have money to provide extra pay or benefits, when it might be spending tens or hundreds of thousands of dollars on anti-union consultants.

What was intended to be a rule protecting workers’ rights has been stopped from taking effect by a judge’s order that was solely focused on the rights of union-busters.

This article originally appeared in inthesetimes.com on July5, 2015. Reprinted with permission.

About the Author: Moshe Marvit is an attorney and fellow with The Century Foundation and the co-author (with Richard Kahlenberg) of the book “Why Labor Organizing Should be a Civil Right.”

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