Advisories

DOL To Enforce Disclosure of Payments, Gifts and Entertainment Involving Union Officials

Even Non-Union Employers Are Required to File DOL Form LM-10

July 2005

In recent guidance issued June 22, 2005, the Department of Labor ("DOL") has indicated an intent to expand its enforcement of the Labor-Management Reporting and Disclosure Act ("LMRDA"). Disclosure may now be required of virtually all service providers to unions, including investment managers, brokerage firms, accounting firms, consulting firms and other "employers," who provide entertainment or give gifts or other things with a value of $25 or more to union affiliated individuals.

The LMRDA requires "employers" who have engaged in certain activities with any labor organization, union official (including a trustee of a Taft-Hartley or a multi-employer pension or welfare fund), union employee or labor relations consultant (each a "Union Individual") to file a report with the DOL detailing the "payments" made to officers and employees of labor organizations. For this purpose, the terms "employer" and "payment" have been broadly construed. Employer is defined as almost all employers who employ employees—regardless of whether their employees are unionized. "Payments" include cash payments, but also business related expenses and disbursements such as the cost of meals and gifts and other things of value received, if they exceed $25. The employer is required to file a Form LM-10 no later than ninety days after the close of each fiscal year of the employer. The requirement to file the Form LM-10 is separate from any other restrictions or prohibitions that may exist under labor law, including certain prohibitions on employers giving gifts or other things of value to union representatives.