Ethics Opinion 314
Whether a Nonlawyer Union Employee May Supervise a Union Attorney
A nonlawyer union employee may supervise an attorney who is representing the union itself. In these circumstances the union is the client and, as an organization, acts through its duly authorized agents. However, the union employee may not supervise a union attorney who is representing a member of the union. The attorney would violate Rule 5.4(c) if she allowed the union employee to direct or regulate her professional judgment in rendering legal services to another.
- Rule 1.2 (Scope of Representation)
- Rule 1.7 (Conflict of Interest: General Rule)
- Rule 1.8 (Conflict of Interest: Prohibited Transactions)
- Rule 1.13 (Organization as Client)
- Rule 4.3 (Dealing with Unrepresented Person)
- Rule 5.4 (Professional Independence of a Lawyer)
Rule 5.4(c) of the District of Columbia Rules of Professional Conduct provides that “[a] lawyer shall not permit a person who recommends, employs, or pays the lawyer to render legal services for another to direct or regulate the lawyer’s professional judgment in rendering such legal services.” A labor union inquires whether the rule is violated “if a nonlawyer union employee supervises a union attorney who (1) represents the union in any matter or (2)represents one of the union’s members in a matter that is within the collective bargaining process.” The union also inquires whether the result would be different if a union attorney represents a member in a statutory proceeding rather than a proceeding arising out of the collective bargaining process. Although this particular inquiry is submitted by a labor union, similar issues may arise for lawyers employed by a corporation, a trade association, or another type of organization.1
A nonlawyer union employee may supervise a union attorney who is representing the union itself. Rule 5.4(c) does not preclude such an arrangement because it deals with the situation where a person (including an entity) “recommends, employs, or pays the lawyer to render legal services for another. . . .” Here the employing organization is the client. “Plainly, a nonlawyer may direct the activities of lawyers when the nonlawyer is a client or an agent of a client in the matter. . . , such as a nonlawyer officer of a corporation who directs the activities of a lawyer in the office of inside legal counsel of the organization. . . .” Restatement Third, The Law Governing Lawyers § 10, comment c (2000).2
Indeed, most lawyers represent, and take direction from, clients who are lay persons. The only difference here is that the client is an organization. Rule 1.13(a) of our Rules of Professional Conduct provides that “[a] lawyer employed or retained by an organization represents the organization acting through its duly authorized constituents.” Those “constituents” may well be lay persons, and a corporation or a labor union may decide as a matter of its own governance that it will assign someone who is not a lawyer to supervise its legal staff. “Persons authorized to act for the organization . . . determine the scope of the representation [and] direct the activities of the lawyer during the course of the representation. . . . [T]he lawyer must follow instructions and implement decisions of those persons, as the lawyer would follow instructions and decisions of an individual client.” Restatement Third, § 96, comment d.
Of course this does not mean that a lawyer must, or even may, surrender his professional judgment when representing a client that happens to be an entity. Rule 1.2 generally defines the scope of representation, and comment  makes it clear that “a lawyer is not required to pursue objectives or employ means simply because a client may wish that the lawyer do so.” Indeed, a lawyer is obliged to withdraw from a representation if she concludes that carrying out the client’s wishes will violate the Rules of Professional Conduct. Rule 1.16(a)(1). Lawyer employees of unions or corporations have the same professional duties, but adhering to them may cause more onerous personal consequences because the employer is the only client. “The power a client employer possesses over a lawyer-employee is substantial, compared to that of a client over an independent lawyer.” Restatement Third, § 32, comment b.
The inquirer also asks how Rule 5.4(c) applies when the union lawyer represents one of the union’s members and not simply the union itself. The answer depends on the context in which the representation occurs, and on whether there is an attorney-client relationship between the union lawyer and the union member.3
As we recently discussed in Opinion No. 316, the existence of an attorney-client relationship is determined by the substantive law of the relevant jurisdiction, not by applying the Rules of Professional Conduct. See generally In re Lieber, 442 A.2d 153, 156 (D.C. 1982) (discussing factors which determine whether an attorney-client relationship has been formed). Moreover, “[t]he existence of an attorney-client relationship is an issue to be resolved by the trier of fact and is predicated on the circumstances of each case.” Id.
Substantive labor law also affects the analysis when the union is representing one of its members in connection with a grievance under the collective bargaining agreement. It is generally recognized that the grievance belongs to the union, not its member, but that the union owes a duty of fair representation to its member. See generally Air Line Pilots Ass’n v. O’Neill, 499 U.S. 51, 76 (1991) (describing doctrine of fair representation); Vaca v. Sipes, 386 U.S. 171, 177 (1967) (same). Accordingly, many cases have held that the lawyer represents the union and not its individual member. See, e.g., Peterson v. Kennedy, 771 F.2d 1244, 1258 (9th Cir. 1985), cert. denied, 475 U.S. 1122 (1986). The United States District Court for our jurisdiction has deemed it “well established, as a matter of law, that an attorney handling a labor grievance on behalf of a union does not enter into an ‘attorney-client’ relationship with the union member asserting the grievance.” Gwin v. National Marine Engineers Beneficial Ass’n, 966 F. Supp. 4, 7 (D.D.C. 1997) (citing Peterson), aff’d, 159 F.3d 636 (D.C. Cir. 1998) (Table). If it is true that the union is the only client, then the union lawyer is not rendering legal services “for another,” and Rule 5.4(c) does not come into play.
This topic has generated a great deal of debate. See, e.g., Russell G. Pearce, The Union Lawyer’s Obligations to Bargaining Unit Members: A Case Study of the Interdependence of Legal Ethics and Substantive Law, 37 S. Tex. L. Rev. 1095 (1996); James G. Pope, Two Faces, Two Ethics: Labor Union Lawyers and the Emerging Doctrine of Entity Ethics, 68 Or. L. Rev. 1 (1989). In many ways the situation is similar to the “eternal triangle” formed by a lawyer, an insurance company that has retained the lawyer, and the insured. Does the lawyer represent only the insurer, only the insured, or both? See generally ABA Formal Op. 01-421 (2001)(noting disagreement among various jurisdictions, but taking “no position as to whom the lawyer represents absent an express agreement as to the identity of the client”).
This Committee, of course, does not opine on questions of substantive law. However, the obligations of the union attorney under the Rules of Professional Conduct will vary depending on whether an attorney-client relationship exists. If the lawyer does not have an attorney-client relationship with the union member, then he likely will have an obligation to clarify the nature of their relationship. This is true even if there is no apparent conflict between the interests of the union and those of its member. “In dealing on behalf of a client with a person who is not represented by counsel, a lawyer shall not . . . [s]tate or imply to unrepresented persons whose interests are not in conflict with the interests of the lawyer’s client that the lawyer is disinterested.” Rule 4.3(b). Moreover, “[w]hen the lawyer knows or reasonably should know that the unrepresented person misunderstands the lawyer’s role in the matter, the lawyer shall make reasonable efforts to correct the misunderstanding.” Id.
The need for clarification increases as the risk of conflict grows. A lawyer shall not “[g]ive advice to the unrepresented person other than the advice to secure counsel, if the interests of such person are or have a reasonable possibility of being in conflict with the interests of the lawyer’s client.” Rule 4.3(a). Furthermore, “[i]n dealing with an organization’s directors, officers, employees, members, shareholders, or other constituents, a lawyer [representing the organization] shall explain the identity of the client when it is apparent that the organization’s interests may be adverse to those of the constituents with whom the lawyer is dealing.” Rule 1.13(b). See D.C. Bar Legal Ethics Opinion No. 269 (1997) (discussing obligation of counsel for a corporation (whether in-house or outside counsel) to clarify role in internal corporate investigation). Such clarification will often be necessary when grievances are being presented under a collective bargaining agreement. As one court has explained, “[t]he interests of individual employees sometimes may be compromised for the sake of the larger bargaining collective.” Garcia v. Zenith Electronics Corp., 58 F.3d 1171, 1176 (7th Cir. 1995).
If the lawyer represents both the union and its member, then conflicts of interest may arise. See generally Rule 1.7(b). Sometimes these conflicts will require the lawyer to withdraw from both representations. In other circumstances, the conflict may be waived by the consent of the union and the union member after full disclosure. Rule 1.7(c).
If the lawyer represents the union member (as part of a dual representation4), Rule 5.4(c) would come into play and would forbid the lawyer to allow a union official (whether an attorney or not) “to direct or regulate the lawyer’s professional judgment in rendering such legal services.”5 Thus, the application of Rule 5.4(c) will depend upon whether there is an attorney-client relationship between the union lawyer and the union member. That question will be answered through the application of substantive law.6
The third part of the inquiry focuses on the situation where a union attorney represents a member in a matter that does not arise out of the collective bargaining process. This might occur, for example, through a legal services program where an attorney paid by the union drafts a will, handles a divorce, or litigates a personal injury suit. These situations would not be impacted by federal labor law, and one would generally expect that an attorney-client relationship will be established between the union lawyer and the union member. In any event, the union would be employing or paying the union lawyer to render legal services to another. Under Rule 5.4(c) the lawyer may not permit a union official “to direct or regulate the lawyer’s professional judgment in rendering such legal services.” See ABA Formal Op. 87-355 (1987) (for-profit prepaid legal services plan must allow lawyer to exercise independent professional judgment on behalf of the client); Alaska Bar Ass’n Ethics Committee Opinion No. 99-3 (1999) (in-house staff counsel for an insurance company may represent an insured, but must be allowed to exercise independent professional judgment).
A nonlawyer union employee may supervise a union attorney who is representing the union itself because the employee is acting as an agent of the client. However, the union employee may not direct or regulate the lawyer’s professional judgment in rendering legal services to a member of the union.
1. We do not address in this opinion potential issues relating to the unauthorized practice of law.
2. As we previously have recognized, “there plainly is no prohibition on an in-house lawyer performing legal work for the corporation that employs him.” D.C. Bar Legal Ethics Opinion No. 135 (1984) (addressing, among other issues, the practice of law with a corporation whose directors or officers are non-lawyers). This opinion construed DR 5-107(B) of the Code of Professional Responsibility, but the language of Rule 5.4(c) is functionally identical. Our conclusion is equally valid when the employing organization is a labor union.
3. For purposes of this opinion, we do not distinguish between a union member and a member of the bargaining unit who does not belong to the union.
4. In D.C. Bar Legal Ethics Opinion No. 94 (1980), we considered the propriety of in-house counsel for a trade association performing legal services for a related organization. We concluded that “[b]ecause the attorneys here are employees of the Association, in every instance in which they would render services to the [related organization], they would be, for analytical purposes, engaging in a multiple representation—even if no services relating to the matter in question are actually provided to the Association and even if the Association’s interests are not involved in the representation.”
5. In Opinion No. 135, we addressed the question of whether a lawyer employed by a corporation whose directors and officers are non-lawyers may perform legal work for the corporation’s clients. Construing the predecessor to Rule 5.4(c), we cautioned that “the non-lawyers involved in the corporation must not exercise any control or influence over the exercise of the [in-house counsel’s] professional judgment in performing legal services for the corporation’s clients.” More recently, in D.C. Bar Legal Ethics Opinion No. 289 (1999), we recognized that the prohibitions of Rule 5.4(c) apply to lawyers as well as lay persons: “We have no doubt that the barriers applicable to lay persons in this setting are equally applicable to lawyers. Indeed, the proposition that lawyers acting on behalf of lay individuals [in our case, a union] may seek to exercise such control over litigation brought by parties to whom they do not owe the lawyer’s obligations of undivided loyalty raises even more significant questions than having lay individuals exercise such control or influence.”
6. If there is an attorney-client relationship with the union member, the lawyer will also have to comply with Rule 1.8(e). That rule provides that:
A lawyer shall not accept compensation for representing a client from one other than the client unless:
(1) The client consents after consultation;
(2) There is no interference with the lawyer’s independence of professional judgment or with the client-lawyer relationship; and
(3) Information relating to representation of a client is protected as required by Rule 1.6.
Here, too, it is crucial to determine as a matter of substantive law whether the union lawyer has an attorney-client relationship with the union member. See Opinion 269 (discussing application of Rule 1.8(e) to lawyer retained by a corporation to represent one of its constituents); D.C. Bar Legal Ethics Opinion No. 225 (1992) (discussing application of Rule 1.8(e) in context of prepaid legal services program).