Union officials who receive large gifts or other benefits from companies with which their unions do business have more to worry about thanks to the Trump administration. With FBI and IRS agents raiding top union officials homes and in one instance even finding “piles of cash” in the garage, the new ruled couldn’t come soon enough.
At the end of May, the Trump Labor Department unveiled a rule that, as a contemporaneous news account filed by the Law360 legal news service explained, imposes “financial disclosure requirements for certain trusts that unions set up, scrutiny the agency says will ‘deter fraud and corruption.”
The proposed rule would reestablish the Form T-1, which until it was scuttled by union-label Obama administration bureaucrats in 2010 blocked officers of unions with $250,000 or more in annual revenue from using trusts supposedly created to benefit rank-and-file members to circumvent the federal reporting requirements for such unions that Congress instituted in the Labor-Management Reporting and Disclosure Act.
A decade ago, right-to-work supporters publicly urged the Obama administration not to kowtow to the demands of AFL-CIO and other union bosses by scrapping the Form T-1 and other upgrades of federal oversight of Organized Labor implemented during the first decade of the millennium in response to revelations of self-dealing and other financial improprieties by top union bosses like plumbers kingpin Martin Maddaloni and laborers bigwig Arthur Coia.
Freedom-loving citizens warned that the Obama roll-back of union financial-disclosure rules would fuel even more of the corruption that is always a byproduct of labor laws that corral workers into unions.
The national scandal connected to the misappropriation of millions of dollars supposedly allocated for training union members by United Auto Workers (UAW) union bosses and automobile company executives, which was first publicly revealed in July 2017 and is still unfolding, illustrates just how right the citizens who spoke out were.
This April, former UAW President Norwood Jewell became the fourth union boss, and the eighth person, to plead guilty to violating the provisions in federal labor law that bar Big Labor officials from soliciting and accepting gifts from employers of the workers they purport to represent.
According to Jewell’s plea agreement, as summarized in a Detroit Free Press article published April 2, executives of Fiat Chrysler Automobiles (FCA) again and again used the National Training Center (NTC) jointly operated by the company and the UAW union hierarchy to furnish him with lavish gifts at the same time that he was the head union negotiator of the workplace contract governing FCA’s front-line employees:
On Jan. 9, 2015, Jewell “spent $7,569 on dinner at LG’s Prime Steakhouse in Palm Springs, Calif.” Over the course of that same month, Jewell “spent $1,267 at Indian Canyons Gold Resort” in Palm Springs. On Jan. 18, 2015, Jewell “approved a $4,587 UAW meal” at LG’s. On Jan. 24, 2015, Jewell “approved [another] UAW official spending $6,200 at Palm Springs Steak & Chop Restaurant.” On July 14, 2015, Jewell “approved a $7,694 meal at the London Chop House in Detroit. Two months later, he approved a $6,912 meal at the same restaurant.”
All of this was paid for by the very auto executives who sat across the table from Jewell with corporate treasury money funneled through the NTC, which as a consequence of the Obama rollback of federal oversight of union finances did not have to disclose to the Labor Department how it spends its funds.
That will finally change, however, if the Trump administration’s proposed enhanced requirements for financial disclosure by Organized Labor are implemented once their notice-and-comment period ends late this month. These revisions are far from perfect. For example, they exempt, for no valid reason, unions with annual revenues of less than $250,000 from having to report on the expenditures of any trusts in which they have an interest.
But the fact that crooked UAW and FCA officials selected the NTC, which didn’t have to file reports on its finances with the Labor Department, as apparently the sole channel for putting corporate money into union bosses’ pockets is powerful evidence that a lack of transparency exacerbates the corruption already fostered by forced union dues and fees.
And until Congress is ready to repeal all the forced-dues and forced-fee provisions in federal law so that union financial support is completely voluntary, enhanced disclosure rules like those now proposed by the Trump administration will be necessary and proper.
Mark Mix is president of the National Right to Work Committee, a group dedicated to the principle that all Americans must have the right to join a union if they choose to, but none should ever be forced to affiliate with a union in order to get or keep a job.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.