The U.S. District Court for the District of Minnesota today ruled in Labnet Inc. d/b/a Worklaw Network, et al v. United States Department of Labor, et al, that the plaintiffs have a strong likelihood of success on the merits of their lawsuit challenging the DOL’s new “persuader” rule, but refused to stay or enjoin the rule. Therefore, for now, the rule will go into effect on July 1. However, based on the judge’s comments, there is reason for optimism that the rule ultimately will be found invalid. There are two other lawsuits challenging the rule pending, in Arkansas and Texas, where rulings have not been issued.

The new  rule  requires  employers  as  well  as  consultants/attorneys  to  report  to  the  DOL  all arrangements  in  which  an  “object”  (directly  or  indirectly)  is  to  persuade  employees  in  the exercise  of  their  “rights  to  organize  and  bargain  collectively  through  representatives  of  their own  choosing”  under  federal  labor  law.    The rule significantly broadens labor services that are reportable, and greatly narrows the legal “advice” exception.