Labor and Employment Law Cocktail

Obama DOL Seeks to Broaden “Persuader” Reporting By Timothy M. McConville, Esq.

The United States Department of Labor (DOL) announced today that, on June 21, 2011, it will issue a proposed rule that will effectively force management-side attorneys and consultants to report their provision of advice in counter-union campaigns.  The proposed rule is an attempt to regulate, and some critics say inhibit, employers’ reliance on consultants and attorneys to guide them in campaigns to counter-union organizing activity.

The DOL is justifying its proposed rule in part based on citations to academic research that the DOL claims “clearly demonstrates that the labor consultant industry has proliferated since the passage of the [Labor-Management Reporting and Disclosure Act], that employers mount sophisticated responses to the presence of union-related activity among their employees, and that employers rely to a great extent on such consultants to assist with those responses.”

The Department of Labor’s Office of Labor-Management Standards will publish a proposed rule to revise the interpretation of “advice” as it pertains to the employer and labor relations consultant persuader reporting requirements of Section 203 of the Labor-Management Reporting and Disclosure Act (LMRDA).  The proposal adopts the plain meaning of the term “advice,” as “an oral or written recommendation regarding a decision or course of conduct.”  The proposed rule will be published in tomorrow’s edition of the Federal Register.  See http://www.ofr.gov/OFRUpload/OFRData/2011-14357_PI.pdf.

Section 203 of the LMRDA requires the disclosure of agreements or arrangements between employers and  labor relations consultants pursuant to which the consultant undertakes or agrees to undertake activities that seek to directly or indirectly persuade workers concerning whether or not to exercise, or the manner of exercising, their rights to organize and bargain collectively.  Neither an employer nor a consultant is required to file a report with the Department of Labor covering the services of a consultant if the consultant is merely giving or agreeing to give advice to the employer. 

According to the DOL, under the proposal, an agreement would be reportable in any case where the consultant engages in persuader activities that go beyond the plain meaning of “advice.” Reportable persuader activities would include those in which a consultant engages in any actions, conduct or communications on behalf of an employer that would directly or indirectly persuade workers concerning their rights to organize and bargain collectively, regardless of whether or not the consultant has direct contact with workers. An agreement would also be reportable in any case in which a consultant engages in specific persuader actions, conduct, or communications regardless of whether advice is given such as when a consultant plans or orchestrates a campaign or program to avoid or counter a union organizing or collective bargaining effort.

The DOL has stated that the LMRDA does not involve regulating the actual persuader activities or statements, and the proposed rule only focuses on whether the activities would have to be publicly disclosed.  The DOL claims that the current interpretation of “advice” has resulted in significant underreporting of employer and consultant persuader agreements.  In an effort to assist organized labor, the DOL’s proposed rule will require more reporting and regulation by employers and their consultants. 

Comments must be received on or before August 22, 2011.

For additional information on the Notice of Proposed Rulemaking, including methods to submit comments, see http://www.dol.gov/olms/regs/compliance/ecr_nprm.htm. 

 

Maryland Passes Law Limiting Employers' Use of Credit Checks by Charity Price, Esq.

On April 12, 2011, Maryland Governor, Martin O'Malley, signed into law the "Job Applicant Fairness Act," which prohibits "an employer from using the credit report or credit history as a basis to deny employment to an applicant for hire, discharge an employee, or determine compensation or the terms of employment."  Fiscal and Policy Note, http://mlis.state.md.us/2011rs/fnotes/bil_0002/sb0132.pdf. The new law will go into effect on October 1, 2011. 

Employers Exempt from the Bill

The following categories of employers are exempt from the bill’s requirements:

(1) an employer required by State or federal law to check the credit report or credit history of an applicant or employee;

(2) a financial institution (or its subsidiary or affiliate) that accepts federally insured deposits;

(3) a credit union share guaranty corporation that is approved by the Maryland Commissioner of Financial Regulation; or

(4) an entity, or its affiliate, that is registered as an investment advisor with the U.S. Securities and Exchange Commission.  

Permitted Uses

An employer may request or use a credit report or credit history for an applicant or current employee, if the employer has a bona fide, substantially job-related reason for requesting the information.  The bill designates certain positions or types of employment in which the employer may have a bona fide reason to use credit information.  The bill indicates that employers may have a use for credit information for positions that involve:

(1) setting the direction or control of a business or a department, division, unit, or agency of a business in a managerial capacity;

(2) access to specified personal information of a customer, employee, or employer  – except for personal information customarily provided in retail transactions;

(3) a fiduciary responsibility to the employer, including the authority to issue payments, collect debts, transfer money, or enter into contracts;

(4) the use  of an expense account or a corporate debit or credit card; or 

(5) access to trade secrets or confidential business information.

Penalty for Violations

An aggrieved applicant or employee may file a written complaint to the Commissioner of Labor and Industry.  If the Commissioner finds a willful or negligent violation, the Commissioner will first seek to resolve the matter informally.  If the Commissioner is unable to reslove the matter, the Commissioner may assess a $500 penalty for the first violation and a $2,500 violation for each subsequent violation.

 

Practice Pointer:  Carefully consider the job-related justification before requesting a credit check on an applicant for employment or a current employee.  Employers should note, however, that this bill does not limit the use of employment-related background checks that provide other types of consumer-related information, e.g. criminal background checks or reference checks.

Guns-in-Cars Bill Fails By Timothy M. McConville, Esq.

The Virginia General Assembly in its 2011 session again considered, but did not pass, a bill relating to the storage of a firearm in an employee’s vehicle while the vehicle is parked on employer property. In the past, the General Assembly rejected attempts to prohibit employers from barring the possession of firearms on employer property. This year’s attempt to address this issue provided that any employer that does not prohibit the storage of a lawfully possessed and transported firearm by an employee in the employee’s vehicle while the vehicle is parked on the employer’s property is not liable for any civil damages resulting from the storage or use of such firearm by a person other than the employer. The bill failed to get out of committee in the House.