The U.S. Department of Labor’s Office of Labor-Management Standards (OLMS) has penned a final rule to establish the “Form T-1” Trust Annual Report, requiring unions to file yearly financials concerning their trusts. The reports will increase financial transparency and ensure that rank-and-file have access to information about union transactions.
The final rule requires a labor organization with total annual receipts of $250,000 or more to file a Form T-1, under certain circumstances, for each trust of the type defined by section 3(l) of the Labor-Management Reporting and Disclosure Act (LMRDA). Such organizations trigger the Form T-1 filing requirements if, during the reporting period, the labor organization—either alone or in combination with other labor organizations—selects or appoints the majority of the members of the trust’s governing board, or contributes more than 50 percent of the trust’s receipts. Any contributions in accord with a collective bargaining agreement shall be considered the labor organization’s.
To reduce reporting burdens, the department is allowing a union to voluntarily file the Form T-1 on behalf of one or more other labor organizations where each would otherwise be obligated to individually file for the same trust. The final rule notes the recent convictions of United Auto Workers and Fiat Chrysler Automobiles officials for criminal acts involving funds meant to operate a training center for union members. Had the Form T-1 been in place, Labor Department officials contend, such acts would likely have been discovered earlier, or might have deterred the perpetrators’ actions entirely.
“Full disclosure of trust operations gives workers the information they need to make informed choices, and more information means better decisions,” says OLMS Director Arthur Rosenfeld. “This rule will increase financial transparency, encourage responsible union democracy and foster accountability of union officials.”
Rank-and-file have long been denied important information about union funds that are directed to other entities, such as joint funds administered by a union and an employer related to a CBA, educational or training institutions, and redevelopment or investment groups. The Form T-1 is necessary to close this gap, prevent certain trusts from being used to evade LMRDA Title II reporting requirements, and provide members information about transactions involving a significant amount of money related to a union’s overall financial operations and other reportable transactions.
Trust reporting is necessary to ensure, as intended by Congress, the full and comprehensive reporting of a union’s financial condition and operations, including a full accounting to members, Labor Department officials affirm. It is also necessary to prevent circumvention and evasion of the reporting requirements imposed on officers and employees of unions and on employers.
The final rule will help bring the reporting requirements for labor organizations and their trusts in line with contemporary expectations for the disclosure of financial information. Labor organization members—no less than consumers, citizens or creditors—expect access to relevant and useful information to make informed decisions on investments, careers and retirement and to exercise legally guaranteed rights. Millions of private and federal sector union members will have increased access to important financial information with the final rule’s implementation.
OLMS administers and enforces provisions of the Labor-Management Reporting and Disclosure Act of 1959. The law promotes union democracy and financial integrity in private sector labor unions, and transparency for labor unions and their officials, employers and others. OLMS also administers provisions of the Civil Service Reform Act of 1978 and the Foreign Service Act of 1980, which extend comparable protections to federal sector labor unions.
IRON WORKERS TOO LATE TO TIE UP REBAR CREW
A National Labor Relations Board official has dismissed an International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, Philadelphia Council petition to conduct a representation election for a proposed bargaining unit under Ohio-based rebar placement specialist R&R Steel LLC. The union sought the election amid work a six- to 11-member crew was performing on a Bordentown, N.J., warehouse project for Midwest Concrete Constructors, to whom R&R provides rebar placement services—at a fixed cost per ton—on commercial jobs in multiple regions. The Iron Workers recognized the limited Bordentown schedule while anticipating the steel subcontractor’s prospects for future Midwest Concrete jobs in a petitioned-for geographic area: New Jersey, Delaware plus one Maryland and 33 eastern Pennsylvania counties.
“The Employer has met its burden to establish that the cessation of its operations in the area is imminent and certain,” NLRB Region Four Acting Director Richard Heller noted in last month’s case decision. “Therefore, I find that no useful purpose would be served in conducting an election at this time.”