“Tell Us More” DOL Passes “Persuader Rule,” And Wants To Know What You And Your Lawyer Are Talking About
- Written by Carl Larson
The U.S. Department of Labor (“DOL”) recently passed its new “persuader rule” which requires that consultants, employers, and their attorneys file detailed reports on any activities related to persuading employees with regard to union organizing campaigns. The obligations include reporting on the extent of legal services contracted for and the amount of money exchanged between an employer and their consultants/attorneys for persuasive activity. The new rule was passed over strong criticism that the rule heavily intrudes upon the attorney-client relationship and will almost certainly be challenged in the Courts.
Persuasive activity includes direct communication to employees or dissemination of materials. However, it now also includes indirect persuasion which essentially includes almost all activities related to running and employer campaign against a union, such as offering advice to the employer about when and where to meet with employees, what information to present, debriefing with supervisors, and identifying materials to disseminate to employees. Even making additions, translations or edits to employer-generated materials could subject a labor consultant or attorney to the reporting obligations under the Labor Management Reporting & Disclosure Act. Routine legal work such as rolling out an arbitration policy could also trigger reporting if done in response to an offhand comment by an employee about the need to be protected from termination.
Pulling Back On The Reins Of The Private Attorneys General Act: New Steps To Curb The Latest Trend In Lawsuits
- Written by Kevin Cleveland
California Governor Jerry Brown’s latest budget proposal contains important provisions which would make significant changes to the way litigation is conducted under The Private Attorneys General Act (PAGA). In recent years, wage and hour litigation has seen an increase in PAGA claims. PAGA allows “aggrieved” employees to recover civil penalties for California Labor Code violations which previously could only be collected by the Labor and Workforce Development Agency (LWDA). In effect, PAGA allows current or former employees to enforce labor code violations through lawsuits against employers. If found liable, employers face thousands of dollars in penalties per employee, per pay period, up to one year and 33 days prior to filing their complaint. As a result, PAGA lawsuits can quickly represent penalties in the millions of dollars for large companies despite what may be relatively minor technical violations.
Luckily for employers, Brown's 2016-2017 state budget proposal seeks to create a “PAGA unit” to review claims and settle them out of court when possible. This would hopefully reduce the amount of PAGA litigation and also lead to the early settlement or rejection of non-meritorious claims. However, under the proposal, the PAGA unit can object to PAGA court settlements and all PAGA settlements would have to be approved by the Court which could complicate settlements or prevent settlements which are overly beneficial to employers.