Settlement Officially Puts an End to 'Persuader Rule'

In a victory for NAHB, the Department of Labor (DOL) on Nov. 9 agreed to a legal settlementthat keeps a permanent injunction in place that stops the “persuader rule” from taking effect and prevents a future administration from seeking to revive the rule.

The Obama-era persuader rule sought to unfairly require lawyers and consultants to report to the DOL when counseling employers concerning union organizing.

The settlement signed by the DOL provides NAHB and its coalition partners peace of mind that the persuader rule cannot be brought again by a future administration, and ends the litigation.

The persuader rule would have impacted NAHB in two distinct ways. First, it would have decreased employer access to qualified labor relations attorneys. Second, trade associations like NAHB would have been directly regulated by the persuader rule if they engaged in certain activities, such as holding educational seminars on labor relations topics.

Regulations under the rule would have included reporting the identities of NAHB members attending these seminars and other complex filing obligations.

The regulation was issued in 2016. However, before it could be implemented, NAHB scored a major legal victory that November when the U.S. District Court for the Northern District of Texas granted NAHB, the Texas Association of Builders, the National Federation of Independent Business and other Texas business groups a permanent stay of the persuader rule.

DOL appealed the permanent injunction to the Court of Appeals for the Fifth Circuit and the agency subsequently moved to initiate a rulemaking to withdraw the persuader rule. That rulemaking was finalized in August 2018. The settlement reached on Nov. 9 ensures that this rule cannot be revived by a future administration.

For more information, please contact Amy Chai at 800-368-5242 x8232 or Alexis Moch at x8407.