THE SMITH CENTER

for Private Enterprise Studies

It Depends on What the Meaning of 'Advice' Is

by Charles W. Baird

As this is written President Clinton has less than a week left in the White House. Ever since the November election he has been working overtime to issue executive orders imposing regulations by presidential fiat that he was unable to persuade Congress to adopt. From the environment to workplace safety rules he has busily imposed extremist, costly interventionist rules supported by Democratic special interest groups such as the Sierra Club and the AFL-CIO. It seems that since they lost the November presidential election Clinton and his clients have decided to grab as much as they can for themselves before they lose power on January 20. Given their record this doesn't surprise many people, but their brazen disregard for the Constitution and its procedures for making laws would make Mussolini blush. To Clinton and company the Constitution seems to be merely a relic from the country's unenlightened past.

At his behest Clinton's Department of Labor has joined the game. On January 10, only ten days before President Bush's inauguration, the Office of Labor-Management Standards in the Department issued a new interpretation of Section 203(c) of the Labor-Management Reporting and Disclosure Act (LMRDA) of 1959. The Act was adopted by Congress principally to address widespread corruption and racketeering infesting labor unions during the 1950s that was uncovered by the McClellan Anti-Racketeering Committee. Title I of LMRDA is a bill of rights for rank-and-file workers to protect them against rapacious union bosses. It has been only moderately successful in that regard.

Section 202(a) requires unions to file annual reports on its expenditures with the Secretary of Labor. Section 203(a) imposes similar reporting requirements on employers regarding their expenditures related to labor relations. Section 203(b) imposes reporting requirements on "Every person who pursuant to any agreement or arrangement with an employer undertakes activities [emphasis added] where an object thereof is directly or indirectly to persuade employees" regarding whether or not to unionize. Section 203(c) says "Nothing in this section shall be construed to require an employer or other person to file a report covering the services of such person by reason of his giving or agreeing to give advice [emphasis added] to such employer."The "other person" refers to consultants hired by employers to help them avoid unionization of their employees.

Since 1962 the Department of Labor has interpreted Sections 203(b) and (c) to mean that if a union-avoidance consultant prepares written or other material which he or she then presents directly to employees this constitutes 203(b) "activities" and triggers the reporting requirements. However, if the consultant's materials are presented to employers who then, on the advice of the consultants, present them to employees this constitutes section 203(c) "advice" and does not trigger the reporting requirements.

The reporting requirements are onerous. If union-avoidance consultants are forced to comply with them they will do less consulting and/or raise the prices they charge significantly. This means that employers will get less professional help with their union-avoidance efforts, thus the unions' organization efforts will be made much easier. Clinton's Department of Labor has unilaterally decided to change the meaning of "advice" in Section 203(c) to exclude the preparation of union-avoidance materials for employers to use. Only "recommendations regarding a decision or course of conduct" will henceforth be regarded as advice. Preparation of union-avoidance materials such as speeches, notices, and videos will henceforth be called Section 203(b) "activities."

Congress has hitherto never quarreled with the 1962 interpretation of "advice." Clinton never even asked Congress to consider the issue. He, without warning or notification, in the waning days of his soiled presidency, instructed his Department of Labor to do the bidding of John Sweeney, president of the AFL-CIO. Sweeney's problem is that fewer and fewer workers are voting to unionize. Employers' informed union-avoidance strategies are part of the reason why unions seem less and less attractive to workers. The biggest reason is that workers are coming to realize that in the face of global competition union-impaired firms do not provide as much job security as firms that are union-free. Sweeney wants to muzzle employers during union organizing campaigns. He wants free speech for himself and his organizers but not for employers or anyone else who tell workers of the advantages of remaining union-free.

Clinton is, in a word, unprincipled. It is not for nothing that George F. Will stated in his January 11, 2001 Washington Post column that "Clinton is not the worst president we have ever had, but he is the worst person ever to have been president."