Union bosses are furiously opposing Secretary of Labor Elaine Chao's efforts to inform union members of how the bosses claiming to represent them spend their financial dues.  Why?  

To keep union members in the dark about their right to the information they are trying to hide.

For example, the Service Employees union suggests that members use this text for letters to Congress opposing the new disclosures:  "By making this information available to the general public...the new requirements would reveal expenditures on organizing, bargaining and other activities--putting efforts by workers to form and join unions at risk." [www.unionvoice.org/seiu/alert-description.tcl?alert_id=7815]

15 years ago, the U.S. Supreme Court held, in Communications Workers v. Beck, that unionized employees could only be required to pay dues for collective bargaining, not politics, organizing and other activities which the union could not prove were related to collective bargaining.  By their own admission, they seek to hide the very information needed to enforce that right "from the general public."

On the web site of Labor Notes, Association for Union Democracy president Judith Schneider wrote:  "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...have violated campaign finance restrictions.  Additionally, the breakdown of expenditures may result in [forced] agency fee payers, those who choose to pay only that portion of dues used for collective bargaining purposes, demanding a larger share of their money back." [www.labornotes.org/archives/2003/07/d.html]

This, according to Schneider, is a good reason to oppose the new disclosure rules.  

These comments reveal the true basis for Big Labor's desperate attempts to tie Elaine Chao's hands by amending the labor department's appropriation bill to nullify the new disclosure forms.  The last thing they want is to encourage workers to exercise their right under the Beck decision to cut off the use of their forced dues for Big Labor's political machine.

That is not too surprising, since the stated reasons for Big Labor's opposition are of little merit.

Union bosses have recently claimed that they are perfectly capable of policing themselves.  At least two recent high-profile cases reported in NLPC's Union Corruption Update (UCU) [www.nlpc.org/olap/ucu/index.htm] cast doubt on that assertion.

Where's the audit?  The Washington Teachers Union
Local affiliates of the American Federation of Teachers are required to submit an audit of their books to the national headquarters every two years.  But after 1995, Washington Teachers Union (WTU) president Barbara Bullock failed to submit that audit.

Because the WTU represents some private employees in Washington, D.C., they must file an LM-2 financial disclosure form with the labor department.  But WTU members looking for information about their union would have seen only disturbing hints of their union's shaky finances. For example, the 2000 form reported $591,262 in disbursements to employees, but it contains nothing about individual employees receiving money. The form also lists $1.7 million as paid "benefits" without even a cursory explanation. It only lists such vague categories as "contributions," "pension expense," and "professional development." Nowhere on the LM-2 form was the WTU required to itemize any of its expenses.

Only when local teachers saw an unannounced tenfold increase in their dues deduction last summer, and complained to the AFT did the apparent embezzlement of millions of dollars by Bullock and other WTU officials come to light.

The AFT has now appointed an administrator and claims to be cleaning up the mess.  But some teachers don't trust the AFT to clean up a mess from their Washington headquarters when they couldn't smell the mess years in the making.  Some teachers have asked that a court-appointed monitor take over the WTU.  On April 30, AFT lawyers admitted to U.S. Dist. Judge Emmet G. Sullivan that while the AFT requires audits from its affiliates every two years (which the WTU failed to do), it had no legal responsibility to even verify that the audits had been filed. "It's a sad commentary," Judge Sullivan said.  "It seems everyone in a responsible position fell asleep at the switch.  The only ones who were vigilant were the thieves, who took everything that wasn't nailed down." [UCU, 5/12/03]

Hiding $500K at the Prime Rib:  The Iron Workers
When he was president of the International Association of Iron Workers during the 1990s, Jake West charged some $500,000 in dining expenses at the Prime Rib restaurant in Washington, D.C., to the union.  Why didn't outraged union members put a stop to it?  Because union accountants classified the expenses, first as "Office/Administrative," then as "Educational/Publicity" expenses.  Those categories on the LM-2 form did not have to be itemized under labor department rules.

Only when federal prosecutors investigating then-D.C. police chief Larry Soulsby for possible corruption charges notice his frequent dining with West did the Iron Workers' scheme begin to unravel. [UCU, 9/2/02]

At the U.S. Department of Labor (DOL), the agency responsible for detecting union corruption is the Office of Labor-Management Standards (OLMS).  Unfortunately, there aren't enough cops at OLMS to periodically audit the nation's unions to ensure that they do not hide embezzlement behind the vague categories of the current LM-2, as Jake West did.

In fiscal years 1998 and '99, for instance, only 9 percent of the union embezzlement cases investigated by OLMS were generated by the agency's Compliance Audit Program (CAP), in which local unions are randomly selected for audits.  But OLMS has only 260 auditors to do the job, compared to the Occupational Health & Safety Administration, which has 1,052 inspectors. ["Protecting Workers Through Union Transparency Reforms," DOL, 3/19/03].  So in 2001, OLMS was able to conduct only 238 audits, while OSHA inspectors were able to conduct 35,966 inspections.

While OLMS certainly needs more money for more auditors, they also need clearer disclosure forms with more specific requirements to deter union officials from trying to hide embezzlement in the first place.

Union Bosses also claim that new disclosure form is too burdensome for them to fill out.  But how can it be more burdensome for union officials to fill out 1 financial form when corporations must fill out three -- a 10-K report, which, according to the Office of Management and Budget, takes 430 hours to fill out -- 10-Q report, which tales 34 hours to fill out every quarter, while union LM-2 forms need only be completed once a year -- an 8-K reports, which must be filled whenever certain events in the corporation's life occur, however often during the year.

Union officials complain of the burden of having to itemize expenses of $2,000-$5,000 under the new rule.  One wonders how they have ever compiled accurate figures of total expenses if they have been unable to account for individual expenses.

No complaints have been heard from union officials about the forms their "section 527" political committees must file with the Internal Revenue Service (IRS).  All 527 groups, including those controlled by unions, must itemize any expenses of $500 or more.  If union political committees can account for individual expenses of $500, union bosses can surely account for individual expenses of $2,000.

In the wake of the Enron scandal, the AFL-CIO proclaimed "No More Business As Usual" in calling for "transparency, accountability and full and accurate disclosure" on the part of corporations.  But when it come to full disclosure to union members, Boss Sweeney claims that the proposed disclosure reforms have "...no widespread support among union members at all." [www.aflcio.org/mediacenter, 12/27/02].  But since making the current disclosure forms of every union available on the labor department's web site in June 2002, 3.4 million people have logged on.  Sweeney could not be more wrong about the workers he claims to represent.  It is far past time to give those workers the information they need an obviously want about their unions.