One day after unions and workers celebrated progress in the campaign to save overtime protections, the Bush administration’s Labor Department issued finalized new rules governing financial reporting by unions. AFL-CIO President John Sweeney called the move “political payback for workers’ overtime pay win.”

The new rules will change the department’s LM-2 forms that larger unions are required to file annually. Beginning in 2004, unions with at least $250,000 in annual receipts will be required to file more detailed reports, including breakdowns of expenses by “functional categories,” such as political activities and lobbying, union administration, strike benefits and representational activities, including organizing, negotiations and contract administration. The old rules did not require such breakdowns.

Under the rules, unions must identify “major” receipts and disbursements of $5,000 or more. The old rules did not mandate specificity on receipts and disbursements.

The rules will burden more than 5,000 labor organizations — only 70 of which are large international unions — with the task of filling out “huge numbers of forms” to meet the rules, Sweeney said.

It Will Cost a Fortune
“Unions will have to dump massive amounts of minute information into the Labor Department’s database at huge expense, yet they will not create a coherent picture of unions’ finances,” Sweeney said. Implementing the new rules will cost unions millions of dollars annually, he said — money that could be better spent on organizing and defending workers.

According to the Labor Department, numerous proposed changes were abandoned or modified in the final rules following review of more than 35,000 public comments on the proposals. For example, the proposed rules suggested a threshold of between $2,000 and $5,000 for reporting “major” receipts and disbursements. The final rule set the threshold at $5,000.

But, Sweeney said, “while unions support reasonable financial disclosure requirements for all types of organizations, the Bush administration’s rules are craftily designed to weaken unions — the strongest advocates for American workers — as our nation prepares for the 2004 elections. The rules...go far beyond what is required of corporations or other not-for-profit organizations.”