U.S. Department of Labor seal
U.S. Department of Labor seal

A new rule from the U.S. Department of Labor will require employers to disclose agreements they have entered into with third-party consultants to try to influence the outcome of union-organizing and collective bargaining campaigns. Published in the Federal Register March 24, the rule is effective April 25 and will apply to arrangements made on or after July 1.

The labor department says that the requirement will close a loophole in Section 203 of the Labor Management Reporting and Disclosure Act that permitted employers to hire consultants without disclosing the fact, as long as the consultants did not directly contact employees. Unions already were required to report expenditures, including those related to union-organizing campaigns.

“This new rule will allow workers to know whether the messages they’re hearing are coming directly from their employer or from a paid, third-party consultant,” U.S. Secretary of Labor Thomas E. Perez said in a statement. “Full disclosure of ‘persuader’ agreements gives workers the information they need to make informed choices about how they pursue their rights to organize and bargain collectively. As in all elections, more information means better decisions.”

The DOL said that it received about 9,000 comments on the rule after it was proposed on June 21, 2011. Whereas labor unions, union officials and some members of Congress, law firms and public policy organizations expressed support, other law firms and public policy organizations, as well as business associations and labor relations consultants, expressed opposition, the department said. In the end, according to the DOL, those who opposed the rule “offered no persuasive argument that the department’s revised reporting requirements for persuader activities will hamper job growth or reduce jobs. …Further, several commenters that supported the department’s proposal referenced the large amount of money that employers spend on consultants, which greatly exceeds the cost for employers and consultants to publicly disclose their agreements.”

The final rule and additional information are available on the DOL Office of Labor–Management Standards website.