Court puts the brakes on Obama’s Labor rule

Kathy Hoekstra

The U.S. Supreme Court recently upheld race preferences in admissions at the University of Texas and struck down an abortion access law.

Important as these are, another federal court ruling temporarily put the brakes on a U.S. Department of Labor order that would be far more intrusive and damaging to the nation’s workforce.

The DOL earlier this year tweaked the “advice exemption” of the Labor Management Reporting and Disclosure Act of 1959. Before, the rule required any people hired to talk directly to employees about unions to report the activity to the government.

This rule has worked and has been endorsed by every presidential administration since it became law.

The change considers all “indirect persuader activity” reportable. This means every business whose owners or managers talk with attorneys about anything covered by the National Labor Relations Act has to report every detail to the government. And so do their lawyers.

The rule was to take effect July 1. But several business groups led by the National Federation of Independent Business and attorneys general of 10 states including Michigan, sought and got, a temporary injunction.

In his order, U.S. District Judge Samuel Cummings called the rule “defective to its core” and “facially invalid” because it wipes out attorney-client privilege and free speech; oversteps states’ rights, as states govern the practice of law; and contradicts Congress’ specific intent to protect this privilege between employers and their advisers.

Cummings also pointed out the DOL didn’t even submit evidence or call witnesses to support its own case.

Perhaps even the current administration knows the move to intimidate employers and their legal counsel is an obvious effort to enable unions to shore up dwindling membership numbers. America’s unionized workforce is currently 11.1 percent - 35.2 percent in the public sector and 6.7 percent in the private sector. That’s a far cry from 20 percent in 1983 and its peak of nearly 35 percent in 1954.

NFIB-Michigan State Director Charlie Owens said, “This administration continues to pander to big labor while treating small business job providers like second class citizens.”

The updated persuader rule is costly. A former economics chief for the Labor Department estimated that compliance for the first year alone would cost business owners and their advisers between $7.5 billion and $10.6 billion, and up to $6.5 billion each year afterward.

That’s $60 billion over 10 years just to comply with one rule.

But the Wall Street Journal reports another encouraging sign the rule has some tough challenges ahead: the U.S. Senate plans to vote to block the rule under the Congressional Review Act, “and the House should do the same. The White House deserves to keep getting kicked until it stops breaking the law.”

In November, we’ll decide the next person to occupy the White House. How does this rule look in a Trump presidency? Clinton?

Kathy Hoekstra is the owner of Kathy Hoekstra Communications, LLC.