Hilda Solis: Organized labor’s humble servant

Richard Berman President, Berman and Company
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Hilda Solis’ term as secretary of labor is one for the books. She will be remembered as the secretary who declared herself the labor movement’s “loyal servant” — and then acted in lock-step with labor leaders.

In that respect, Solis could also be remembered as the secretary of labor who showed us just how outdated our labor laws are.

One of Solis’ first moves as secretary of labor was to weaken the regulation that requires union officials to report potential conflicts of interest. Although the law remained in place, the new weakened requirements that it placed on union leaders were anything but stringent.

This wasn’t a random decision. The AFL-CIO listed this change as one of its “Day One” priorities for President Obama’s term. The only thing that prevented the AFL-CIO from getting this demand met earlier was the Senate’s delay in confirming Solis.

Solis followed this up by eliminating a transparency regulation requiring that unions provide their members with basic financial information regarding union trust funds. This came less than two years after the Mackinac Center discovered that some unions had dipped into their trusts to fund such necessities as NASCAR sponsorships and political receptions.

Solis also made sure that President Bush’s updated financial reporting requirements, which strengthened and extended the financial details that unions have to report to their members, died before year’s end. Solis’ spokeswoman remarked that the change occurred because of the secretary’s dedication to “fair and balanced enforcement of labor-management reporting laws.”

These changes couldn’t have come at a worse time. From 2001 to 2009, more than 1,000 union leaders were indicted on charges ranging from fraud to embezzlement. During that same period, union members received over $93 million in court-ordered restitution of misspent union dues.

Given that record, and at a time when reporting requirements for American businesses were skyrocketing, lessening the load on unions made little sense.

Solis’ blatant favoritism toward unions also manifested itself in a shockingly low number of union financial and compliance audits, which gauge whether unions are faithful to the federal statutes that protect union members from a variety of corrupt practices. Between 2005 and 2009, the Department of Labor conducted an average of 736 audits per year. By 2011, the number had dropped to 461 — a 38 percent decline in just two years.

Then there’s the matter of what the audits have discovered. In a sample of 513 audits, the Department of Labor only reported violations in 16% of them. Yet when the Office of the Inspector General double-checked the Department of Labor’s work, it found that fully 92% of them contained violations — violations that Solis’ shop had either missed or failed to report. Talk about a credibility gap.

Perhaps most striking is the fact that 15 percent of the audits led to criminal charges being filed. Compare that to the less than one percent of businesses that get similarly charged, yet they never enjoyed a reprieve from government audits over the past four years.

Solis’ leadership of such a dysfunctional, biased, and irresponsible Department of Labor is lamentable. But the deeper issue was her ability to substantially and unilaterally change labor law without legislative consent.

Congress can remedy this problem by passing the Employee Rights Act. At a time when union regulation and oversight is at a historic low, the ERA would proactively require labor leaders to faithfully represent the interests of their members, while protecting the rights of those employees who aren’t unionized.

The ERA would give workers the freedom to decide for themselves what power unions will have in their lives. Mandatory secret-ballot elections will keep unionization drives fair, while paycheck protection will ensure that no worker spends money on a political candidate he doesn’t support. And if union members feel like their union no longer represents their best interests, they can easily and safely vote to decertify their union. Moreover, they’ll be able to do so free from the threat of violence, which the ERA categorically criminalizes.

Hilda Solis reminded us exactly why organized labor needs these reforms. Instead of letting union partisans like Solis unilaterally affect the lives and welfare of millions of American workers and their families, Congress should take steps to ensure that organized labor is fair, rather than favored.

Richard Berman is the executive director of the Center for Union Facts.