U.S. Department of Labor considers proposed rule to increase union transparency

If you are interested in submitting a comment to DOL on the proposed rule, you can do so here. The deadline is 11:59 p.m. tonight, December 14. 

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The Center submitted comments recently to the U.S. Department of Labor in support of a proposed rule that would modernize and increase the financial transparency of government unions.

Currently, most public employees are not able to review their union’s finances. Only unions with private-sector members are required to report their financial and membership data through federal filings referred to as LM-2 forms. And even though LM-2 forms submitted by unions do provide some information to their members, the proposed updates would remove ambiguity and provide more transparency for public-sector members wondering how government unions are spending their hard-earned money—from political donations to union salaries. For example, one proposed change would ask unions to distinguish the dollars spent on representational activities, such as contract negotiation, versus organizing. Such a breakdown would shed light on how well unions are working to serve their current members and address unions’ tendency to list political activities as representational. (How much are union officers and employees spending on travel to protest or engage in lobbying on legislation that doesn’t address public employees’ needs in the workplace?) Another change would split unions’ self-reported political activities and lobbying into two separate line items, giving public employees greater details on what is spent on get-out-the-vote campaigns versus meetings with legislators.

Greater financial transparency on LM-2 forms would help reduce corruption. Given the number of union executives who have pled guilty to or have been convicted of corruption charges this year, improvements in transparency would discourage civil and criminal violations and deter officers or employees from embezzling, self-dealing, or improperly using union dues for their own self-interest.

Greater transparency would also help members track changes in membership. Since the U.S. Supreme Court’s 2018 decision on Janus v. AFSCME, government employees no longer have to financially support a union to keep their job. The current form does not disclose sufficient information regarding changes in membership numbers.

The proposed rule is a modern update to the existing reports unions must already file. Given that it has been over 15 years since a major update to union transparency, it is important for unions to catch up with the times. Private-sector unions are required to disclose high-quality information about their union activity and finances, and public-sector unions should be held to the same standard.