April 29, 2021

ABA Fights to Protect Attorney-Client Confidentiality and the Right to Counsel

Urges Senate Leaders to Remove ‘Persuader Rule’ Provision from PRO Act

ABA President Patricia Lee Refo sent a letter to Senate leaders on April 20 urging them to remove controversial language from a sweeping labor law.

ABA President Patricia Lee Refo sent a letter to Senate leaders on April 20 urging them to remove controversial language from a sweeping labor law.

ABA President Patricia Lee Refo sent a letter to Senate leaders on April 20 urging them to remove controversial language from a sweeping labor law reform bill that would require many employers’ attorneys to report sensitive and confidential client information to the government.

The Protecting the Right to Organize (PRO) Act of 2021, S. 420 and H.R. 842, includes numerous proposed changes to the nation’s labor laws, including a provision that would reverse the Department of Labor’s more than 50-year-old policy of protecting confidential attorney-client communications by effectively reinstating the so-called “Persuader Rule.”

In her letter to the Senate Majority and Minority Leaders and the Senate Health, Education, Labor & Pensions Committee, Refo noted that by opposing the persuader provision in the PRO Act, “the ABA is not taking sides on a union-versus-management dispute.” Instead, she explained that the Association is “defending the confidential attorney-client relationship and right to counsel by urging Congress not to impose an unjustified burden on clients and the attorneys and law firms that represent them.”

The ABA-opposed Persuader Rule—which was permanently blocked by a U.S. District Court in Texas in 2016 and then rescinded by the Labor Department in 2018—would have greatly narrowed the Department’s longstanding interpretation of what attorney activities constitute “advice” to employer clients and thus are exempt from the extensive reporting requirements of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA).

The LMRDA requires employers and their labor consultants—including attorneys—to file detailed periodic disclosures with the Labor Department when they take steps to persuade employees on whether or how to exercise their rights to organize a union and bargain collectively. But the Department and federal courts have long interpreted the statute to exempt attorneys who merely provide advice or other legal services directly to their employer clients but have no direct contact with the employees.

By greatly narrowing the advice exception, the PRO Act would require many attorneys who advise their employer clients on sensitive unionization issues to file disclosure reports with the government for the first time. These reports would have to include such confidential information as the existence of the legal representation and identity of the client, a description of the legal tasks performed, and extensive financial information about the attorneys’ employer clients that is unrelated to the persuader activities the LMRDA is intended to monitor.

Refo explained in her letter that although the ABA had no position on the other provisions of the PRO Act, the persuader provision in the legislation is deeply flawed and should be removed for several reasons.

First, by requiring attorneys to disclose extensive information about the persuader-related advice and legal services they provide to their clients, the provision conflicts with longstanding attorney ethics rules, including ABA Model Rule of Professional Conduct 1.6 requiring attorneys to protect client confidentiality and the many binding state court rules that closely track the ABA Model Rule.

Second, the provision would weaken the confidential attorney-client relationship and employers’ right to counsel. By forcing attorneys to file detailed reports regarding the advice and other legal services they provide to employer clients in unionization cases, the provision would undermine this confidential relationship and discourage many employers from seeking the expert legal representation they need.    

Third, by requiring attorneys to report extensive financial information about every employer client that receives any “labor relations advice or services”—not just those clients receiving persuader-related advice—the provision would discourage many attorneys from agreeing to represent employers in unionization matters at all.

The ABA is urging Senate leaders to protect the attorney-client relationship and the right to counsel by removing the persuader provision from the PRO Act and ensuring that the provision is not included in the upcoming infrastructure package or any other legislation. Protecting these fundamental legal principles in all areas of the law remains one of the ABA’s highest priorities.

For developments on this and other issues involving the confidential attorney-client relationship, follow us on Twitter @ABAGrassroots.

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