Statements on Introduced Bills and Joint Resolutions

Floor Speech

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - December 18, 2009)

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By Mr. CORNYN (for himself, Mr. Alexander, Mr. Barrasso, Mr. Bennett, Mr. Bond, Mr. Brownback, Mr. Burr, Mr. Chambliss, Mr. Coburn, Mr. Cochran, Ms. Collins, Mr. Corker, Mr. Crapo, Mr. DeMint, Mr. Ensign, Mr. Enzi, Mr. Graham, Mr. Grassley, Mr. Gregg, Mr. Inhofe, Mr. Isakson, Mr. Kyl, Mr. LeMieux, Mr. Lugar, Mr. McCain, Mr. McConnell, Ms. Murkowski, Mr. Risch, Mr. Roberts, Mr. Sessions, Mr. Thune, Mr. Vitter, and Mr. Wicker):

S.J. Res. 24. A joint resolution providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Department of Labor relating to financial disclosure and transparency by labor union management; to the Committee on Health, Education, Labor, and Pensions.

Mr. CORNYN. Mr. President, the U.S. Department of Labor's Office of Labor-Management Standards, OLMS, is responsible for ensuring that labor unions follow basic standards of fiscal responsibility. OLMS collects annual financial disclosure reports, LM-2, from labor organizations with annual receipts of $250,000 or more. Union members who work hard to pay their dues deserve to know how their money has been spent. So, these annual financial disclosure reports provide rank-and-file members with an essential tool for exercising union democracy: information about important financial decisions made by their union leadership. Consequently, it is vital that OLMS have the necessary tools to monitor union compliance with the law as well as to deter corruption. Yet, on average, over ONE third of all unions fail to comply with existing requirements to file annual financial disclosure reports on time.

In fact, between 2001 and 2008, OLMS reported that its investigations yielded a total of 1,004 indictments with 929 convictions and court-ordered restitution of more than $93 million dollars. For example, according to statistics reported by the Office of Management and Budget, OMB, the OLMS audits turned up criminal violations in about 11.5 percent of audits and nearly 8 percent of unions showed some fraudulent activity in 2008 alone. Between January 1 and October 19, 2009, OLMS reported obtaining indictments, convictions and sentences in embezzlement cases that total nearly $3 million in theft from union funds.

In order to provide a better method for collecting information about union finances, the Department of Labor proposed modifying the LM-2 form. After a lengthy rulemaking process, the Department issued a final rule on January 21, 2009, which required additional information about the receipt and disbursement of labor organization funds, and established standards and procedures for revoking, where appropriate, a labor organization's simplified filing privilege. But politics got in the way of transparency and good government. And on October 13, 2009, the Department announced a final decision to rescind these regulations.

This is outrageous. No one is talking about protecting rank-and-file members' ability to hold their leadership accountable. Instead, the Secretary of Labor has bowed to pressure and complaints from labor unions. The unions argued that requiring labor organizations with reported annual receipts over $250,000 to file more detailed disclosure reports was unnecessarily burdensome and imposed additional administrative costs on their organizations.

Rigorous disclosure requirements promote union transparency and accountability of union leaders to their rank-and-file members. The annual financial reports ensure that workers' dues are used legitimately and can also help workers and oversight investigators detect fraudulent or criminal activity. Bringing corrupt union officials to justice and recovering millions of dollars in hard-earned dues would not be possible if unions were not required to file annual financial disclosure reports.

For this reason, I am introducing a Congressional Review Act resolution disapproving the Department of Labor's October 13 decision to rescind the LM-2 rule. My resolution, which is cosponsored by 17 of my colleagues, would have the effect of reinstating the original LM-2 rule published in January 2009 and would ensure that OLMS continues to protect the rights of rank-and-file union members against corrupt union leaders.

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