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DOL's proposed report form a mixed bag
A discussion by Judy Schneider, AUD President

The US Department of Labor is proposing major changes in union financial reporting, including new requirements that salaries and other expenses be allocated into clearly identified categories: political activities, lobbying, organizing and contract negotiation and administration, expenses over a certain threshold must be itemized, and the finances of certain organizations, in which the union has an "interest" (over $10,000 in payments) must be reported. Currently, the finances of only a union's wholly owned, controlled or financed organizations are subject to mandatory disclosure.

The AFL-CIO says that the reporting burden would cost its affiliates hundreds of millions and be particularly onerous for smaller unions (the rules would apply to any union with over $200,000 in yearly receipts.) The federation argues that it is political retaliation for, and an effort to inhibit, widespread union support for Democrats. And it contrasts this detailed regulation of unions to the current administration's striking antipathy to regulation to require full corporate financial reporting, protect the environment, insure food and water safety and prevent repetitive stress injuries.

It's hard not to agree that the DOL's motivation is questionable notwithstanding its pointing to the better exercise of union members "self-governance rights" that will flow from enhanced disclosure. (The DOL's lack of interest in requiring federal unions to simply disclose the democratic rights of members provided by federal law is noteworthy here.) And to a lay person, it does seem that the reporting requirements will be very burdensome, certainly for a small union, to accurately fulfill in the real world. However, it's unarguable that the proposed rules will provide more information to enable a diligent member to determine what's really going on in the union.

But with at least one puzzling exception which raises again the issue of the Department's motivations: The current LM-2, Question 16, requires specific disclosure when any officer who was paid $10,000 also received $10,000 or more as an officer or employee of another labor organization or employee benefit. If anything, this requirement should be strengthened to mandate that the total amount received also be disclosed. Instead, and without any explanation, this question has been deleted. It appears that under the DOL's vaunted new "enhanced" reporting, the disclosure of who receives multiple salaries and fees will less easily obtainable for the average union member. Explanation anyone?
This mixed bag should go back for reconsideration.

Good reasons and bad to oppose the rules
a comment by Carl Biers

While the AFL-CIO has organized an aggressive campaign against the "burdensome" rules, it is clear that most union members would welcome access to more information. It is impossible for someone who is unfamiliar with union bookkeeping to accurately judge how onerous the new LM-2 will be. What then to make of the new rules? Putting aside the question of how burdensome they are, there are other reasons - some good, some bad - to oppose the rules.

Good reasons to oppose the rules

1) Political Action. Forcing unions to report what percentage of staff time and total expenditures are made for political action and lobbying will make it easier to allege that unions which engage in vigorous efforts to elect prounion candidates or support proworker initiatives have violated campaign finance restrictions.

2) Agency fees. The break down of expenditures may result in more agency fee payers -- nonmembers who pay only that portion of dues used for collective bargaining purposes -- demanding a larger share of their money back.

3) The source. It is difficult not to be suspicious of any union-related initiatives coming out of an administration with such an antiworker, antiunion record. (This is not necessarily a good reason to oppose the rules, however. They should be judged on their merits and their effect on the labor movement. Measures to democratize unions have always had a certain appeal to conservatives who believe, mistakenly, that if members are given more control, then the union will support conservative candidates and policies).

Bad reasons to oppose the rules

1) Protecting labor racketeers. Union corruption has declined, but remains an intractable problem in some unions. The Teamsters are in the 14th year of a federal monitorship to rid the union of racketeers. The New York Times reported last year that federal prosecutors are mulling a similar move against the ILA.

2) Bureaucracy. Many unions that are free of racketeering or deep-seated corruption still bristle at the notion of giving information to the members. The IAM, for example, refused members' repeated requests for compliance with a section of the LMRDA which requires unions to "inform members of the provisions of the Act." Members had to sue all the way to a federal appeals court to get the union to do the right thing.

To see the new rules.
For more on the Department of Labor search this site for "DOL" or "Department of Labor."

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