Labor Secretary Tom Perez, rumored to be on Hillary Clinton's short list for the veep slot on the Democratic ticket, has given unions a new tool to use against business. It's called the "persuader rule."
As the Wall Street Journal explains today, the new rule is "supposedly intended" to be an update to the Labor-Management Reporting and Disclosure Act of 1959, which requires that those hired by employers to communicate directly with employees publicly disclose their clients, services, and pay. This must also be disclosed by employers.
The 1959 law, however, makes clear that advice an employer gets in confidence is protected by attorney-client privilege, an important principle of law that allows employers to obtain counsel without worrying that their communications will be exposed in legal proceedings. The new rule nullifies this. This could make it difficult for businesses to privately obtain advice to make important decisions:
For example, an employer would likely have to report asking a consultant to study the labor savings of moving to a right-to-work state. An attorney would have to disclose private discussions with an employer over a neutrality agreement to support a union’s organizing campaign. Only communications in actual collective-bargaining negotiations and with internal counsel will remain exempt.
The rule is designed in such a way that businesses might even find it hard to find lawyers to counsel or represent them:
Here’s the extra rabbit punch: The 1959 law requires that any persuader also must disclose all clients for which they provide “labor relations advice or services.” This has rarely applied since most attorney-employer communications weren’t deemed persuader activities. But now an attorney who advises Employer A about a union organizing campaign will also have to report if he’s conducting, say, a sexual harassment investigation at Employer B. All of this information will be public.
As former American Bar Association president Bill Robinson told Congress, attorneys will be less willing to represent employers. And employers will be more reluctant to seek outside counsel on union-related issues and may thus become more prone to run afoul of multiplying federal rules. Large businesses can deploy in-house lawyers and consultants to skirt the rule, but small businesses will suffer as usual. The Manhattan Institute estimates the rule will cost about $60 billion over 10 years.
Unions will find doing business easier than companies:
The beneficiaries [of the new rule] will be unions, which don’t have to report their own persuader activities. Their goal is to use private employer communications to bully businesses into backing their organizing campaigns.
Private sector unions are having a harder time staying afloat than in the past. Their decline in membership is decades long, but the Obama administration has done everything it can to try to help unions, which are a source of campaign contributions for Democrats, with their organizing campaigns.
What the Wall Street Journal calls a "dubious rewrite" on a fifty-nine-year-old law is simply the latest effort to save unions. If employees felt that unions represented them and their views, unions would not need such sneaky attempts to save them.