LUBBOCK -- A U.S. judge has issued a permanent injunction setting aside an Obama administration directive requiring employers to document when they enlist consulting firms and attorneys to advise on anti-union campaigns.
U.S. District Judge Sam Cummings sided with Texas Attorney General Ken Paxton and the National Federation of Independent Business which deemed the so-called “persuader rule" a violation of federal law.
In his ruling, Cummings denied the government's motion seeking to set aside a preliminary injunction issued by the judge in June and instead granted the NFIB’s motion for permanent injunction.
Andrew Leonie, associate deputy attorney general for Texas, said he was pleased with the decision.
"This office is extremely pleased that this misguided effort has been halted,” Leonie said. “This was a reach and clearly in violation of federal law. Fortunately, Judge Chambers saw through this and we were able to prevail.”
The "persuader rule" was one of several regulations the Obama administration advanced in support of labor unions. Prior to the issuing of the directive, an attorney and labor relations consultants who engaged in face-to-face dialogue with workers in an effort to convince them to not to join unions were required to report their activities and their pay.
Indirect communication could not be reported and federal laws allowed an exemption for employers from disclosing when they received advice on how to respond to union organizing activity.
The agency said the rule will allow workers to have the proper information at hand when making the decision to organize or form unions. The regulation had the support of several major labor unions, including the Service Employees International Union and the AFL-CIO.
The National Federation of Independent Business immediately sued, alleging the law would render it difficult and expensive for small business to procure legal advice.
Texas and nine other states joined the lawsuit alleging the Department of Labor directive was an encroachment on their right to regulate the legal profession within their borders.
Leonie said the law went beyond infringing on a role traditionally governed by state bar associations by treading upon the fundamental right to counsel and the attorney-client privileges.
“Employees have rights and at the same time employers should not be forced to reveal confidential information in violation of a privilege that has been historically protected under the Constitution,” he said.
The outgoing Obama administration has pushed through other labor-friendly regulations including measures that sought to make it harder for companies to classify workers as independent contractors rather than designating them as employees.
According to Leonie, his office has had no contact with the incoming administration of President-elect Donald Trump but is confident the matter is settled.
“The judge has sent a clear message in this case,” Leonie said. “And while the government has the option to appeal to the fifth circuit court of appeals but we don't anticipate that. We haven’t spoken with anyone in the new administration but we would hope that they agree and see it from our point of view.”
The case is National Federation of Independent Business v. Perez, U.S. District Court for the Northern District of Texas Lubbock Division Case number No. 16-cv-66.