Bloomberg Law
Free Newsletter Sign Up
Bloomberg Law
Welcome
Go
Free Newsletter Sign Up

Trump Rule Targeting Union Finances Killed by Biden Agency (1)

Dec. 29, 2021, 5:14 PMUpdated: Dec. 30, 2021, 4:48 PM

The U.S. Labor Department has finalized its decision to rescind a Trump-era rule that subjected union strike funds, apprenticeship programs, and other trusts to stricter transparency requirements.

The department’s Office of Labor-Management Standards released a final rule Wednesday to scrap the 2020 regulation, which had required unions with at least $250,000 in annual receipts to disclose information about multiple forms of trusts they maintain, including labor-management cooperation committees.

Under Director Jeffrey Freund, the office halted enforcement of the rule in March, before unions faced a deadline to start submitting the new “Form T-1" disclosures the regulation had mandated.

The office will continue to enforce unions’ longstanding annual obligation to file detailed financial information—including receipts for funds that are diverted to trusts—in so-called LM-2 reports, which are required of all unions with annual receipts exceeding $250,000.

The Biden Labor Department said that it found the disclosures required by the Trump administration were “overly inclusive” and “not necessary” for enforcement.

Union watchdog groups and business lobbyists had asserted the now-erased regulation was needed to curb the type of corruption that fueled the embezzlement scandal plaguing the United Auto Workers, which resulted in multiple convictions and guilty pleas and a federal monitor being appointed to oversee the union for six years.

The final rule will be published in the Federal Register on Thursday and will take effect in 30 days.

(Updated in 2nd graph with type of trust that was to be disclosed in previous rule. Story originally published Dec. 29.)

To contact the reporters on this story: Ben Penn in Washington at bpenn@bloomberglaw.com; Rebecca Rainey at rrainey@bloombergindustry.com

To contact the editors responsible for this story: John Lauinger at jlauinger@bloomberglaw.com; Martha Mueller Neff at mmuellerneff@bloomberglaw.com