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New DOL Reporting Requirements For Employers

Client Alert | 1 min read | 12.01.05

In what is probably the most significant (and relatively unnoticed) labor law regulatory initiative of the year, the Department of Labor (DOL) has issued an “advisory” providing new guidance regarding employer reporting obligations under the Landrum Griffin Act (LMRDA). The LMRDA requires employers to report payments of “money or things of value” made to labor unions, labor union officers or representatives, and labor relations consultants. Employers who make such payments are required to file an LM-10 form on an annual basis, in the same way the LMRDA requires labor unions to file LM-1, LM-2, and LM-30 forms.

DOL’s advisory reflects a much more aggressive enforcement posture with respect to a very complex area of labor law, involving overlapping provisions of the LMRDA and the Taft-Hartley Act. An employer’s reporting obligations go far beyond what has traditionally been thought of as payments for “persuader” activities under the LMRDA.

LM-10 forms must be filed within 90 days of the end of the company's 2005 fiscal year. Except for an initial grace period that will apply only to service providers and others who believed they were not required to file such reports, LM-10 forms must be signed by the employer's president and treasurer, with a certification that is analogous to the Sarbanes-Oxley certification. The LMRDA's criminal penalties apply to this reporting obligation, as does the statute's 5 year recordkeeping requirement.

Unionized employers in particular should review the advisory, as well as the underlying statutes and case law, to determine the extent to which they have provided "things of value" that may trigger reporting obligations. Specific practices to review include: monetary payments to union officers, other gratuities or benefits provided to union officers, paid time off policies for union stewards and others, and payments made to consultants and others who may be characterized as “persuaders.”

Many companies will find this to be a particularly challenging regulatory compliance matter, given the intersection of the LMRDA and Section 302 of the Taft-Hartley Act, and the dearth of case law interpreting these obligations.

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