The Obama administration appears to be backing away from the movement toward greater disclosure of union finances.
In May the U.S. Department of Labor indicated it would propose changes to its current interpretation of federal rules. The new reevaluation will likely stall further proceedings on the Alabama Education Association v. Chao case pending before the U.S. Court of Appeals for the D.C. Circuit.
At issue is whether state-level public-sector unions must disclose their finances in a fashion similar to private-sector unions. The Court of Appeals issued a stay in the case at the request of the Labor Department.
In Court for Years
The lawsuit has worked its way up and down the court system for several years. During the George W. Bush administration, the Department of Labor expanded its interpretation of federal law to include state-level unions if those unions are affiliated with national unions subject to federal disclosure.
The Alabama Education Association and 31 other state affiliates of the National Education Association challenged the revised disclosure rules in court. Last year a federal district court judge ruled the Bush administration’s Department of Labor had demonstrated a reasonable legal justification for reinterpreting federal law to mandate state-level public-sector union disclosure. The unions lost a motion for reconsideration and then appealed to the DC Circuit Court of Appeals.
Union financial transparency has been required by law since 1959, when Congress passed the Federal Labor-Management Reporting and Disclosure Act in an attempt to curtail corruption in private-sector unions. That law did not apply to state and local public-sector unions if they did not represent any private-sector workers.
Enforcement Delayed, Ended
The Obama Department of Labor already has delayed implementation or stopped enforcement of several rule changes from the Bush administration. The forms affected by the changes are the LM-2, LM-3, LM-30, and T-1, which involve financial disclosure of unions, union officers, staff members, possible conflicts of interest, and certain union-run trusts.
The result is that state affiliates representing only public employees are not yet obligated to fill out LM-2 forms. This means union members and the public may continue to be kept in the dark about the spending habits of some public-sector union officials.
Scott Dilley ([email protected]) is a labor policy analyst at the Evergreen Freedom Foundation in Olympia, Washington.
