Ethical Transparency: Why the Department of Labor’s Persuader Rule Does Not Conflict with Attorneys’ Professional Responsibilities, by Ruben J. Garcia (ACSblog)

We are looking at another hot summer of litigation over the Obama Administration’s attempts to bring a modicum of regulation to the workplace. Currently, the Department of Labor’s Persuader Rule, enacted pursuant to federal labor law, is being reviewed in three different district courts and in Congress. Since 1959, the Labor Management Reporting and Disclosure Act (LMRDA) has required employers to disclose certain expenditures used to persuade employees in their choice of a bargaining representative. Once the DOL’s final revised rule implementing the mandate of the statute was published, employers and their law firms quickly brought suit to block the rule. The House Committee on Education and the Workforce held a hearing on April 27 which included three witnesses opposed to the rule, and one supporting it. Republicans in the House have introduced a Congressional resolution challenging the revised Rule as well.

Federal courts in three different states will soon decide whether the revised rule should be enjoined because it exceeds the DOL’s authority or violates the U.S. Constitution. Apart from the merits of these challenges, there have been several complaints about how the revised rule’s requirement to report arrangements to provide “indirect persuasion” might cause attorneys to violate their ethical duty of confidentiality. The former president of the American Bar Association testified at the April 27 hearing that the revise Persuader Rule would “undermine the confidential attorney-client relationship.” The problem with these concerns, as I and numerous other labor law and legal ethics professors have written in a letter to the Committee, is that the revised Persuader Rule can coexist comfortably with the ABA Model Rules of Professional Conduct.

The DOL’s Persuader Rule Does Not Require Reporting of Arrangements Where an Attorney Agrees to Exclusively Provide Legal Advice to Clients.

The LMRDA’s reporting regime has always accommodated attorneys’ professional responsibility concerns when attorney-client communications were potentially subject to disclosure. For example, it is undisputed that Section 204 of the LMRDA expressly exempts the reporting of any “information which was lawfully communicated to such attorney by any of his clients.” 29 U.S.C. § 434 (2012). Further, several circuit courts of appeal have seen no conflict between LMRDA’s reporting requirements and the attorney-client privilege. For example, the Sixth Circuit, in Humphreys v. Donovan, upheld the LMRDA’s reporting requirements for attorneys engaged in persuader activity, noting that “[i]n general, the fact of legal consultation or employments, clients’ identities, attorneys’ fees, and the scope and nature of employment are not deemed privileged.” 755 F.2d 1211, 1219 (6th Cir. 1985).  See also, Wirtz v. Fowler, 372 F3.2d 315, 332-33 (5th Cir. 1966); Douglas v. Wirtz, 353 F.2d 30, 33 (4th Cir. 1965).

The DOL’s Final Rule Is Consistent with the Model Rules of Professional Conduct.

There is no conflict between the LMRDA’s regulatory regime administered by the DOL and the ethical responsibilities of lawyers. In the comment of the American Bar Association, filed with the DOL on September 21, 2011, the ABA argued that the proposed Persuader Rule was inconsistent with Model Rule 1.6 which prevents attorneys from disclosing confidential information. Even when an attorney engages in persuader activities and must report those activities under the Final Rule, however, there is no conflict between the Persuader Rule and legal ethics rules because the current version of the Model Rules contains several possible exceptions to the attorney’s ethical duty of confidentiality. The language of ABA Model Rule 1.6(a) is broad in terms of the material possibly covered by the attorney’s ethical duty of confidentiality, as it applies to all “information relating to the representation of a client.” M.R. 1.6(a). For decades, though, the ABA has gradually added exceptions to the confidentiality rule.

Indeed, current Model Rule 1.6(b)(6) was added to the rules in 2002, and protects attorneys from discipline if they disclose certain client information to comply “with other law or court order.” M.R. 1.6(b)(6). Therefore, the Model Rule clearly contemplates the disclosure of confidential information to comply with a law such as the LMRDA. To date, 49 states and the District of Columbia have adopted professional conduct rules patterned on the ABA Model Rules. Only California has not, but the California Rules of Professional Conduct provide that attorneys may reveal information as required by the “the

State Bar Act, these rules, or other law,” and the California courts have followed the ABA rules in numerous instances. See Cal. Rule Prof. Conduct 3-300 n.2.

There are many other laws that require certain disclosures by attorneys when they engage in certain activities on behalf of a client, including the Lobbying Disclosure Act (LDA) of 1995. Lobbying disclosure reports require much of the same information as on the forms that are at issue here, including the names of clients and payments. Both lawyers and non-lawyers alike are subject to the reporting requirements of the LDA, which has never been successfully challenged in over 20 years in effect. There are numerous other examples of similar reporting regimes that have been enacted over the last several decades, with little evidence that attorneys are being chilled from fulfilling their duties to clients.


In sum, there is no conflict between the Persuader Rule and the ethical rules governing attorneys. The Department of Labor has not placed attorneys who engage in persuader activity between a labor law rock and a legal ethics hard place. The Persuader Rule provides an opportunity for employers and their attorneys to ethically practice transparency in union election campaigns, which are an important part of American workplace democracy.

Ruben Garcia

Ruben J. Garcia is Professor of Law at the University of Nevada, Las Vegas, William S. Boyd School of Law. Prior to joining the UNLV faculty in 2011, he was Professor of Law and Director of the Labor and Employment Law Program at California Western School of Law in San Diego, where he taught for eight years. He also has held academic appointments at the University of California, Davis School of Law, the University of Wisconsin Law School, and at the University of California, San Diego. Before beginning his teaching career in 2000, Garcia worked as an attorney for public and private sector labor unions and employees in the Los Angeles area. His scholarship has appeared in a number of leading law reviews, including the Hastings Law Journal, the University of Chicago Legal Forum and the Florida State University Law Review, among others. His first book, published by New York University Press in 2012, is entitled Marginal Workers: How Legal Fault Lines Divide Workers and Leave Them Without Protection. From January 2014 to January 2016, he served as the Co-President of the Society of American Law Teachers (SALT), and has served on the Board of Directors of the ACLU of Nevada. In Fall 2015, he was selected as a UNLV Leadership Development Academy fellow. He is a member of the Board of Directors of the American Constitution Society (ACS), a national nonprofit organization, and an advisor to the Boyd Law Student and Las Vegas Lawyer Chapters of the ACS.