On June 27, 2016, in National Federation of Independent Business v. Perez, a federal judge in the Northern District of Texas issued a nationwide injunction blocking the DOL from enforcing its new interpretation of the advice exemption in Section 203(c) of the Labor Management Reporting and Disclosure Act (LMRDA). (No. 5:16-CV-00066-C (N.D. Tex. June 27, 2016).)

On March 24, 2016, the DOL's Office of Labor Management Standards (OLMS) issued a final rule amending the DOL's interpretation of the advice exemption in Section 203(c) of the LMRDA (29 U.S.C. §433(c)). Known as the "persuader rule," the OLMS regulations require employers, their outside labor counsel, and their labor consultants to report certain additional "indirect" activities they take to persuade employees about how to exercise their rights in union elections and some collective bargaining. The final rule took effect on April 25, 2016 and applies to arrangements, agreements, and payments made on or after July 1, 2016 between employers and outside counsel and consultants tasked with performing the more broadly-defined persuader activities (see Legal Update, Persuader Regulations Finalized, Increase Employers' and Attorneys' Reporting Obligations).

The plaintiffs, primarily trade associations, challenged the rule and sought a preliminary injunction against its enforcement. They claimed that the rule:

The district court issued a nationwide injunction blocking enforcement of the rule, ruling that:

The district court distinguished its irreparable harm analysis from that in a recent ruling from a parallel case in the District of Minnesota. In that case, the judge ruled that the DOL's new interpretation of the advice exemption was likely unlawful but did not grant a preliminary injunction to the plaintiff lawyer association (see Labnet Inc. v. DOL, (D. Minn. June 22, 2016)).

UPDATE: On November 16, 2016, in National Federation of Independent Business v. Perez, the US District Court for the Northern District of Texas granted summary judgment to the National Federation of Independent Business, denied the DOL's cross-motion for summary judgment, holding the rule was unlawful for the reasons the National Federation of Independent Business asserted. The court converted its preliminary injunction to a permanent national injunction preventing the DOL from implementing the rule. (No. 5:16-CV-00066-C (N.D. Tex. Nov. 16, 2016).)

An interlocutory appeal on the preliminary injunction is pending before the US Court of Appeals for the Fifth Circuit (National Federation of Independent Business v. Perez, No. 16-11315 (5th Cir. Aug. 29, 2016)).

UPDATE: On June 12, 2017: OLMS issued a Notice of Proposed Rulemaking proposing to rescind regulations established in the rule, "Interpretation of the 'Advice' Exemption in Section 203(c) of the Labor-Management Reporting and Disclosure Act," known as the persuader rule. Comments are requested by August 11, 2017. (82 Fed. Reg. 26877 (June 12, 2017).)

UPDATE: On July 18, 2018 OLMS published a final rule in the Federal Register rescinding the regulations established in the final rule titled "Interpretation of the 'Advice' Exemption in Section 203(c) of the Labor-Management Reporting and Disclosure Act," effective April 25, 2016 (see 81 Fed. Reg. 15924 (Mar. 24, 2016). Under the final rule, the OLMS also revises the Form LM-20 Agreement and Activities Report and the Form LM-10 Employer Report. The rule is effective on August 17, 2018. (Rescission of Rule Interpreting "Advice" Exemption in Section 203(c) of the Labor-Management Reporting and Disclosure Act, 83 Fed. Reg. 33826-01 (July 18, 2018).)