A Texas judge struck down the Labor Department’s new rule meant to stymie business-side labor lawyers from giving employers advice on Monday.
The judge ruled that the regulation, dubbed the “Persuader Rule,” infringed on lawyer-client confidentiality.
“By threatening Plaintiffs’, their members’ and other employers’ access to legal and other advice, the New Rule also threatens irreparable harm by interfering with First Amendment rights,” said Texas District Court Judge Sam Cummings.
The Labor Department adopted the new rule, a reinterpretation of the Fair Labor Standards Act, in March. The new version says that any lawyer who instructs a business on issues related to federal labor law, such as how to respond to a bid to unionize their workers, must publicly report the activity, including the financial details. Under the prior version of the rule, the reporting only had to be done if the lawyers directly spoke to the workers on behalf of management.
The administration said the change was needed for transparency’s sake. Labor groups applauded the move, saying the old rule gave cover to union-busting campaigns. Business groups denounced it, arguing it was little more than an attempt to aid union organizing efforts by making it harder for businesses to get legal advice.
Monday’s judgment was in reaction to a case brought by a coalition of business groups lead by the National Association of Manufacturers.
“Today is a victory for the preservation of the sanctity of attorney-client confidentiality. Every American knows that when they talk to a lawyer, their conversation is confidential,” said Texas Attorney General Ken Paxton in a statement. “That confidentiality has been the cornerstone of the attorney-client relationship since before our nation’s founding. If information confidentially given to one’s attorney is also accessible by the federal government, it would damage the very foundation of our system of justice.”
