Special Editorial Reports
Obama’s labor department quashes union financial reports
By: Kevin Mooney
Commentary Staff Writer
May 1, 2009
President Obama’s Labor Department is rolling back reporting requirements begun by the Bush administration to highlight compensation packages and other financial transactions benefitting labor union officials.
At issue are LM-2 and LM-30 financial disclosure reports that unions with financial receipts of $250,000 or more must file annually. Under the Bush administration, the LM-2 required union officers to account for all of their compensation benefits, information which had never previously been disclosed.
The Bush LM-30’s required shop stewards to report information needed to expose “no-show jobs” in which paychecks go into union coffers instead of a real worker’s bank account.
But Labor Secretary Hilda Solis is moving to repeal those disclosure rules, despite Obama’s frequent promises of greater openness and transparency in government, according to former Bush Administration Labor Department appointees.
“With regard to the LM-2 it is my belief that the department is pulling back on the new forms because the union leadership is concerned about how their members might react when they see how generous the compensation is,” said Don Todd, who was deputy assistant secretary in the Office of Labor Management Standards (OLMS) under Bush.
Todd’s OLMS was responsible for enforcing the disclosure requirements Solis is now repealing. He is now research director for Americans for Limited Government, a conservative non-profit.
More than 900 union officials were convicted on embezzlement, fraud and conspiracy charges, during Todd’s OLMS tenure. The amounts embezzled ranged from $5,000 to more than $100,000.
The LM-2 and LM-30 reports “certainly helped to raise red flags that would alert our investigators.” said Todd. “Union officials who should be defending their member’s interests instead stole from them. I think there is a sense of entitlement on the part of some officers who feel like they are entitled to these funds and they don’t feel like they are doing anything wrong.”
Solis began the repeal process earlier this year when the Labor Department published a federal register notice announcing a proposal to rescind changes made by Bush officials to strengthen the LM-2. Solis agreed with union officials’ claims that there was no proof members would benefit by knowing the information reported, and that compiling the report was too costly.
More recently, Solis said unions no longer have to file the pre-Bush version of the LM-30, since the Labor Department will soon propose repeal of the Bush edition. Nathan Mehrens, another former Bush labor official, called that a “sneaky” approach.
“In my opinion union members are still legally required to submit the new form,” Mehrens said. “But in reality this will not be enforced and there will not be any penalty for ignoring the new law. This means certain information will not disclosed and this is seriously unhelpful to the public.”
Solis did not respond to The Examiner’s request for an interview.
Kevin Mooney is an investigative writer on The Examiner's commentary staff.
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