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August 12, 2011
SEAN HIGGINS
The Obama administration is quietly pursuing a labor policy that would make it harder for employers to seek advice on countering union organizing bids. The change would require new disclosures when management hires consultants to fight organizing drives. That may dissuade some companies from seeking outside advice and force many consultants out of the business. Consulting firms "are really worried," said Michael Eastman, executive director of labor law policy at the U.S. Chamber of Commerce. "If these disclosure rules go through, they are going to be required to report their client list and the fees they charge." Ross Eisenbrey, vice president of the liberal Economic Policy Institute, says the rules will make the process fairer. Management often makes an issue of union officials' salaries to dissuade employees from organizing. "It is only fair that the unions be able to say, 'Hey, the company is paying the incredibly fat salaries of these lawyers to keep you from organizing,'" he said. The administration proposed the change in late June . Official rule-making is likely in the fall. The proposal reflects the pro-union stance of President Obama, who has backed Big Labor's agenda in Congress, trade deals and presidential appointments. This particular proposal comes from the Labor Department. Unions have long sought the change, labor policy experts say. They would publicize the disclosed information to shareholders, employees and the press. "The employers will either (respond to organizing bids) on their own and screw it up because they don't get any advice or they will decide, 'We will not say anything,'" said a lawyer who does labor consulting work. Consultants advising labor in union drives don't have to file such disclosures, experts say. Businesses often hire outside legal consultants — "persuaders" in labor law jargon — in response to organizing bids. They currently must disclose such hiring only when consultants interact with employees. In other words, the companies must tell the Labor Department when they hire somebody to directly tell employees why they might not want to join a union. Failure to comply is a crime punishable by up to five years in jail. Under the proposed rule, the disclosure requirements would be broadened to include advice by consultants on what management should say to employees. "If the consultant actually, for example, prepares talking points for the supervisors and coaches and directs their meetings with employees, then this is reportable persuader activity," a Labor official told IBD.