The Labor-Management Reporting and Disclosure Act of 1959 (LMRDA) requires employers to file a report with the Department of Labor (DOL) for each year in which the employer has some reportable activity as defined by the LMRDA. This obligation applies to most every employer, including those whose employees are not represented by a union. Generally, the LMRDA requires the disclosure of certain payments of money or other things of value by an employer to a union, a union official, a labor relations consultant, and sometimes even to employees. The disclosure is to be filed on the DOL’s Form LM-10 (Employer Report). For many years this reporting requirement received little attention from both employers and regulators alike, but in 2006, the DOL issued new guidance and thereby refocused attention on this obligation.
The Form LM-10 filing deadline is 90 calendar days after the end of the employer’s fiscal year. So, if your company uses the calendar year as its fiscal year, the fast approaching reporting deadline is March 30, 2012. You still have time to investigate whether your company has to file a report this year, and to accomplish that mission if it does.
Doing this correctly is key. The LMRDA requires that the report be signed, under oath, by the employer’s president and treasurer, and the LMRDA imposes both potential criminal and civil penalties for willful violations. The DOL publishes instructions for employers on how to fill out the Form LM-10, but even with the instructions, doing this correctly can be easier said than done. For example, it can be challenging to determine with certainty what types of payments or arrangements need to be disclosed through the LM-10. The law identifies various reporting exemptions (like wages paid in the ordinary course of business to an employee who also is a union official), as well as a de minimis exception for amounts under $250, and those exemptions must be understood and applied. Also, identifying all the situations that might implicate the reporting requirement requires some comprehensive assessment and some creative thinking.
To give you some idea, here is a partial of the list of payments the DOL says must be reported (assuming they are greater than $250):
- An employer of union members takes a union official with whom it is negotiating a collective bargaining agreement out for dinner and drinks worth more than $250
- An employer pays any of its employees to persuade other employees not to join a union or to affect the negotiation of a collective bargaining contract
- An employer makes expenditures for the printing and dissemination of pamphlets, advertisements, or other printed matter that threatens to move or close the plant if organized
- An employer gives gifts or provides services to employees on the condition that they will not organize
- An employer pays a labor relations consultant to deliver an anti-union speech to its employees
- An employer pays a labor relations consultant to plant agents among its employees to obtain reports about a union’s organizational activities
- An employer of the union members provides the union’s officers an exclusive opportunity to purchase the employer’s stock at below-market prices
- A vendor of office supplies to a union guarantees payment of a bank loan made to a representative of that union
- A vendor of printing and publishing services to a union sends a holiday gift basket worth more than $250 to the union’s treasurer
- A vendor of legal or accounting services to a union takes the union’s officers on a golf excursion
- A vendor of financial services to a union affiliated pension plan provides a gift worth more than $250 to a union trustee