A huge target may be forming on the backs of senior living providers through a proposed rule that greatly expands employers’ public disclosure requirements for legal consultations about labor issues.
The rule in its finalized form will do away with an existing advice exemption to the Labor-Management Reporting and Disclosure Act of 1959, forcing clients to disclose both the consultant and their fees if they’re getting advice on labor issues, said Paul Williams, senior director of government relations at the Assisted Living Federation of America during the trade group’s 2013 Conference & Expo.
“They want to discourage you from using legal advice and consultants,” he says, “but they also want to embarrass you.”
The rule was proposed in June 2011, went through a comment period that has since closed, and is a couple months behind on its April 2013 final rule deadline. But it is going to happen in some way, shape, or form—and it’s a big deal, says Diane O’Malley, JD, a partner at law firm Hanson Bridgett LLP who specializes in senior living labor law.
The existing interpretation of the “advice” exemption requires employers who hire an attorney to directly speak with employees about exercising their rights to organize or collectively bargain—otherwise known as persuaders—to file employer reports with the Secretary of Labor in the DoL’s Office of Labor-Management Standards. The LM-10 form publicly discloses financial transactions, agreements or other arrangements between the employer and certain organizations, including reporting of specified payments such as salaries or expenses to these groups.
However, employers were exempted from disclosing those details if they were only getting advice from the consultant, and there was no direct contact between a persuader and employees.
“The proposed rule greatly expands who is going to be subject to the [Labor-Management Reporting and Disclosure Act],” says O’Malley. “I speak to [senior living] managers, supervisors, and owners with respect to union organizing, assist with campaign materials, and train supervisors, but don’t deal directly with rank-and-file employees who could organize. In the past, we’ve been exempted from disclosure, but now we’ll have to disclose our contract with the client.”
A consultation could be as innocuous as going to an attorney and asking them to develop a social media policy for a senior living community, Williams explains. Alternatively, a senior living provider may ask an attorney to assess a particular community’s vulnerability of being unionized. Both those actions would have to be disclosed.
“The unions, we know, are going to use this as leverage with employees,” Williams says. “They’ll try to say, ‘Hey, you wanted a $2-an-hour raise, but didn’t get it—but your employer just spent [X amount] on a social media policy.'”
The main goal, according to Williams, is to embarrass employers—including those in the senior living industry. While the final rule has not yet been published, he says it’s safe to say the elimination of the advice exemption will happen this year.
“We’re not anti-union,” he said, adding that there are ways to be proactive and make a community less vulnerable. “We’re trying to protect our employees and employers. We have rights. But some of those rights have been trampled on.”
The problem, says O’Malley, is that senior living employers may start going without consultations with labor lawyers to avoid having to disclose them. But by not consulting, they could get into trouble if they don’t understand there are certain things they can and can’t say or do.
“What happens is, the unions all know they have the opportunity to see what is being disclosed and discussed,” she says. “They can make something of that—and they will.”
The new rules could even apply to in-house counsel, O’Malley believes, as the LMRDA requires employers under certain conditions to report payments to their own employees to persuade other employees concerning their bargaining rights.
For senior living providers with a union-free workplace philosophy, Williams advises a proactive approach emphasizing supervisor training. Educating supervisors as to the company’s position on why they think it shouldn’t be organized is key, according to O’Malley, along with making sure they also understand what they can and cannot say to employees so they don’t commit unfair labor practices.
Activity is only going to pick up, Williams said, cautioning against the “myth in senior living” that the National Labor Relations Board is only going to go after large senior living providers.
“Union membership is at historical lows. If they can pick up three or four dues paying members, it’s worth it to them,” Williams said. “It’s certainly not just targeting big communities anymore. Senior living is a target—and any size community in senior living.”
The SEIU (Service Employees International Union) did not respond to SHN’s request for comment regarding the proposed rule as of press time.
Written by Alyssa Gerace