On Monday, the Department of Labor’s Office of Labor-Management Standards (OLMS) held a public meeting to discuss potential changes to employer and consultant reporting under section 203 of the Labor-Management Reporting and Disclosure Act (LMRDA). Section 203 establishes reporting and disclosure requirements for employers and labor relations consultants who enter into agreements or arrangements “whereby the consultant (or other person) undertakes activities to persuade employees as to their rights to organize and bargain collectively or to obtain certain information concerning the activities of employees or a labor organization in connection with a labor dispute involving the employer.” The agency requires employers and consultants to annually fill out certain disclosure forms regarding these arrangements. As the law currently stands, Section 203(c) exempts employers and consultants from filing these reports by reason of the consultant’s giving or agreeing to give “advice” to the employer. During Monday’s hearing, the OLMS indicated that it believes the current interpretation of the advice exception was overbroad and seeks to narrow it through rulemaking, as outlined in its semiannual regulatory agenda. (pdf)

In addition, the agency suggested that the exception under Section 203(e), which excludes “regular officers, supervisors and employees” from the reporting obligation, should be narrowed to encompass more conduct than is currently considered reportable. The OLMS also indicated its desire to gather information on how the use of consultants has impacted labor-management relations and on how persuader activity has changed since enactment of the LMRDA.

A number of labor-affiliated hearing participants spoke in favor of such changes to the reporting and disclosure requirements. Participants from the business community, however, emphasized that narrowing Section 203’s advice exemption would adversely impact attorney-client communications and the free speech rights of employers.

Speaking on behalf of the U.S. Chamber of Commerce, Michael Eastman, the Chamber’s Executive Director of Labor Law Policy, expressed concern (pdf) that narrowing the advice exemption will make it more difficult for employers to obtain legal advice about labor relations and the National Labor Relations Act, which is “highly nuanced and near impossible for a layperson to understand without counsel.” Eastman also expressed concern with potential changes to Section 203(e) of the LMRDA:

The statute was designed to provide disclosure when employers engage third parties to interact with and persuade employees because employees may not otherwise know such individuals are agents of the employer – this is not true in the case of the employer’s supervisors, managers, and officers. The practical difficulties of accounting and reporting under the so-called split-income theory cannot be justified.

Other speakers echoed Eastman’s free speech and attorney-client privilege concerns.

Photo credit:   Alex Nikada