17 November 2016

Federal Court Permanently Enjoins Department of Labor Persuader Rules

On November 16, 2016, the United States District Court for the Northern District of Texas issued a permanent injunction that prohibits the Department of Labor (DOL) from implementing its new Persuader Regulations concerning when employers and labor consultants must make certain financial reports and disclosures to the DOL. The Court, which had earlier this summer temporarily enjoined the rules, found the new regulations to be unlawful and ordered them set aside. The permanent injunction has nationwide effect.

The permanent injunction is welcome news for employers, but the future of the new regulations is unclear. In the short term, we expect the DOL to appeal the decision. Last week’s election, however, may affect the DOL’s long term commitment to the so-called Persuader Regulations. Although President-Elect Trump has not made any public comment regarding these rules, many political commentators expect his administration to adopt a more pro-employer labor policy. This could include revoking the new Persuader Regulations and returning to the DOL’s interpretation of those rules that has stood for more than 50 years.

If you have any questions about the permanent injunction or the persuader regulations, please contact a member of Miller Johnson’s Employment and Labor group.