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In the last minutes of the Clinton Administration DOL Narrows Exemption for Labor Relations Consultants.

Clinton's Department of Labor cited evidence of a significant increase in the use of labor relations consultants by employers set on discouraging union organizing as a reason for narrowing an exemption in the Labor-Management Reporting and Disclosure Act (LMRDA).

The DOL has revised its interpretation of what is know as the LMRDA's "advice" exemption, which it claims has effectively shielded consultants from the law's reporting requirements since 1962. The Labor Department said the action was necessary to update application of the law's reporting requirements to third party consultants used by employers.

Under the LMRDA (also known as the Landrum-Griffen Act) which was established in 1959, employers and labor relations consultants are required to file reports on any expenditures and any agreements or arrangements that affect employees' organizing and bargaining rights.

Before the revisions Section 203 (c) created an exemption from the reporting requirements for "advisory" services. The revised interpretation significantly narrows the circumstances that can be considered advice under the statute, and thus have to be reported.

Under the revised interpretation activities that would not have to be reported include situations where a lawyer or consultant simply reviews and revises persuasive material prepared by the employer. Conversely, reporting is required when a lawyer or consultant prepares or provides persuasive material used by an employer in communicating with employees.

Another reason cited by the DOL for the revision is the consultant's growing role in labor relations, both in advising on an anti-union campaign and in producing videos and other communications. The view until now has been that speeches, scripts, documents or videotapes fell into the "advice" category since employers could decide to use them or not. The DOL has said that the advice exemption has become too broad since an employer "generally has the authority to accept or reject the work done for him."

Under the new interpretation the duty to report is triggered as long as persuading workers is the object of the consultant's activity. The old interpretation provided that most consultant activity - unless it involved direct contact with workers - fell under the advice exemption.

While there is no assurances from the Bush Administration, it is possible this last minute action by the Clinton people may come under scrutiny by the new Secretary of Labor.

If you have any questions about this new interpretation of LMRDA contact us at Braun Consulting Group.

3. Interim Rules Issued for Bush Executive Orders of February 17th, 2001. 

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