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New Federal Rules for Unions

August 1st, 2007 Posted by Amelia

The U.S. Department of Labor recently published a final rule that improves disclosure by union officials and employees to expose any conflict of interest.

New reporting requirements for union officials and employees go into effect on August 16, 2007. The rules improve disclosure of payments by union officials and union employees. These include payments from employers of workers that the union represents, and payments from the employer’s competitors.

However, there are still some significant loopholes in the reporting process.

This is an important regulation because it provides rank-and-file union members with vital information about the officials who are representing them.

Until this regulation went into effect, a union official could be in business with the employer. Workers would never know that the person who was negotiating their contract, was actually a business partner of their employer. The new regulation would make such a conflict of interest clear to workers.

There are still a few loopholes in the rules. The new regulations still don’t require that union officials report gifts or payments totaling $250 or less. Payments or gifts of $20 or less do not have to be counted towards that $250 total. This means that an employer could give a union official $20 at 1,000 different times during the year. The total payment would be $20,000, yet the union official would not have to report any of these payments under the new rules.

Another exception to the new rules makes more sense. A union employee or official who is a bona fide employee of the business – such as an elected union steward who works for an auto manufacturer – would not have to report his or her salary and benefits. In this example, the union steward would not have to disclose wages from the auto manufacturer.

Although the new regulations go into effect this month, union workers won’t see the results until 2008 or later. That’s because the new reporting forms, called LM-30s, are not required for 2007. The updated forms will be required from all union officials in 2008 and later.

The move is aimed to increase transparency between unions, workers and the public. Under the new regulations, union officials will be required to disclose more information on payments, gifts and benefits provided by employers and businesses. The disclosure will ensure that union members are aware of potential conflicts of interest by their elected union officials.

The Labor-Management Reporting and Disclosure Act ( or LMRDA) requires that union officials and employees file a report with the Department of Labor for any year in which they engage in certain transactions or arrangements. Union officials must make information about gifts and payments public if they are received from:

An employer whose workers the union represents
An employer whose workers the union is actively seeking to represent
Other employers in designated categories

Under the new regulations, union officials have to report any fees that they are paid to serve on the company’s board of directors. They would also have to report any gifts or payments received from the employer’s competitors. Under the new regulations, a union official would need to report a spouse’s partnership in a catering company used exclusively by the union.

Union stewards are currently allowed to devote part of their workday to union business such as processing grievances without any loss of pay. This is referred to as a “no-docking” clause in a contract. Under the new regulations, this time is limited to 250 hours per year. A union steward who receives more time under a “no-docking” clause would need to report it as a payment.

In addition, employees of the union as well as union officials must reveal any business deal with: