A milestone will be reached Tuesday when Elaine Chao becomes the longest-serving secretary of labor since Francis Perkins was appointed by Franklin D. Roosevelt. Historians will someday look back on the Chao era as a time when transparency and accountability in union finances finally began to be taken seriously by the Labor Department.
Chao’s good work continues today when the Federal Register publishes a proposed rule to extend the Bush administration’s previous accomplishments in applying the Labor-Management and Disclosure Act of 1959.
Among other things, the proposed rule adds a provision covering benefits paid to union officers and employees such as pensions, deferred compensation and life insurance. Currently, only gross salary, allowances, outlays for official business and assorted other disbursements to individual officers and employees exceeding $10,000 annually need to be disclosed.
Closing this loophole will enhance the ability of union members to have timely and accurate information about how union leaders and employees are being compensated. Without such information, it is difficult to assess whether the interests of members are being well-served by those representing them in the union leadership.
Other positive enhancements in the proposed rule include disclosure of payments made directly to vendors for expenses incurred by a union officer or employee; more detailed disclosure of receipts for income exceeding $5,000 from dues and agency fees, fines, interest, rents, dividends and sales of supplies; and disclosure of the identity of the buyer or seller in transactions involving all union assets worth $5,000 or more.
These changes will allow union members to have accurate information on expenses incurred by an officer or employee, as well as more complete data on revenues received by a union and whether asset sales are being made at market prices and at arm’s length.
In response to the proposed rule, AFL-CIO President John Sweeney predictably accused Bush and Chao of preferring “to spend time on a witch hunt aimed at unions than on advancing the interests of workers.”
In fact, hundreds of union officials have been convicted of serious crimes since 2003 when the Bush administration first began requiring fuller disclosure of finances by unions with annual receipts of at least $250,000.
Many of those crimes would have gone undiscovered had Chao simply ignored enforcement of the 1959 law, as did so many of her predecessors. Thanks to her, union members now have effective tools to hold union leaders like Sweeney genuinely accountable.
