Landrum-Griffin, LM-2, Reform Moving Forward

In a joint hearing Apr. 10, two subcommittees of the House Committee on Education & the Workforce heard testimony about whether the Dep’t of Labor’s union financial reporting and disclosure regulations are meeting the requirements of the Labor Mgmt. Reporting & Disclosure Act, a.k.a, the Landrum-Griffin Act. “The law was intended to ensure that rank-and-file union members have a full, equal, and democratic voice in union affairs,” said Rep. Sam Johnson (R-Tex.), chairman of the Employer-Employee Relations Subcommittee. “With the passage of time, we have seen some aspects of union democracy thrown to the wayside and often ignored. Union leaders should respect the law, and [DOL], which is responsible for putting teeth into the LMRDA, should aggressively enforce it. Unfortunately, neither is always the case.”

“The reporting and disclosure provisions of [LMRDA] are a failure because among other things the [LM-2] form only requires unions to report their expenses in broad categories,” said Rep. Charlie Norwood (R-Ga.), chairman of the Workforce Protections Subcommittee. “The result is that they can hide illegal or questionable disbursements.”
 Norwood also commented on data showing in that 34% of unions filed late financial reports with DOL or none at all. “The only thing I can compare this lack of enforcement to is the prohibition era when speakeasies operated openly because of paid-off local police and politicians. Labor leaders know that they can do just about anything, because [DOL] will look the other way in the hopes of getting union support for the incumbent President.”

Saying that “a significant number of unions consistently fail to comply with the statutory requirements that they timely file annual reports,” Deputy Sec’y of Labor D.  Cameron Findlay noted that “many observers believe that [DOL] does not have sufficient enforcement tools to punish wrongdoers” such as civil money penalties for delinquent filers. He was also critical of the current LM-2 and the other annual financial reports: “The existing forms utilize such broad, general categories that union leaders could easily use them to hide overspending, financial mismanagement, and other irregularities from their members.”

Robert Fitch, a freelance labor reporter, lauded Johnson and Norwood for their “efforts to chip away at the wall that separates union members from the information they need to hold their leaders accountable.” He added that “Americans can discover a great deal about what’s in their food, their corporations, their consumer products, but American unions have still not been brought effectively into the Information Age.”

Phillip Wilson of the Labor Relations Inst., said “In the face of the Enron and ULLICO financial scandals, shareholders and union members alike want new assurances that they can rely on those they entrust with their money to use it wisely on their behalf.” He concluded: “increased transparency and improved distribution of financial information can only serve to strengthen connections between unions and their members.” Johnson and Norwood, have introduced legislation that would amend LMRDA to improve and better safeguard members’ democratic rights. [Rep. Johnson 4/10/02; BNA 4/11/02]