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Labor Dept. Plans Increasing Scrutiny of Union Finances


Published: April 17, 2005

WASHINGTON, April 14 - The Bush administration is rapidly expanding audits of the nation's labor unions, citing a need to ferret out and deter corruption. But union leaders assert that those increased efforts are nothing more than crude political retaliation.

Pointing to embezzlement of hundreds of thousands of dollars by the presidents of the ironworkers union and Washington's teachers union, Labor Department officials say the number of audits fell too far in the 1990's and needs to be restored to previous levels.


They note that the number of national unions and locals that were audited fell to 206 in 2000, from 1,080 in 1991. By contrast, the department did more than 500 audits last year and hopes to do even more this year. To bolster its drive further, it expects to add 48 full-time workers to its union-auditing unit this year, a 14 percent increase, despite cuts in other areas.

"I think you need a minimum level of enforcement, which is something I don't think this agency was able to do for a while," said Lary F. Yud, deputy director of the Labor Department office that investigates unions. "I think we need to do a certain level of audits in order to create an effective deterrent."

Labor leaders see the new effort as retaliation for their nearly unanimous support for Senator John Kerry in the 2004 presidential election. Vast support for Mr. Kerry came from the A.F.L.-C.I.O., which has been informed by the department that it will be one of the first national labor organizations audited as part of the expanded efforts.

"It is obvious," said John J. Sweeney, the federation's president, "that the Department of Labor's assignment of 48 new staff to audit unions, starting with the A.F.L.-C.I.O., is pure political payback for the labor movement's opposition to the president's antiworker policies."

Labor leaders acknowledge the importance of fighting corruption, but say the increase in audits is just the latest effort by the Bush administration to weaken or annoy unions. They cite the administration's decision to remove collective bargaining rights from tens of thousands of Defense Department workers. They also point to rules adopted by the Labor Department last year requiring unions to fill out spending forms in far greater detail, generally explaining how much of each expense over $5,000 goes to administrative, political and collective bargaining costs.

"It's so complicated," said Edward P. Wendel, general counsel of the United Food and Commercial Workers. "We've spent untold hours on it, hundreds, thousands of hours more."

But Mr. Yud said that if the department had been doing audits as vigorously as in decades past, it might have prevented corruption like the embezzlement of more than $2.5 million by leaders of the Washington Teachers Union. Among the items bought with the stolen union money were a $57,000 Tiffany tea service for 24, a $13,000 plasma television and a $20,000 custom-tailored mink coat.

There were also the 277 checks totaling $41,309 that the secretary of an autoworkers' local wrote to herself over two and a half years, and the dues money stolen by the office secretary of a Minnesota plumbers' local, who, in ultimately pleading guilty, agreed to repay $54,469.

Since 2001, department officials say, more than 500 union officials have been indicted on charges including fraud and embezzlement.

"Strict enforcement of federal labor laws is necessary to protect workers from even the potential for corruption within their union leadership," said Representative John A. Boehner, Republican of Ohio, the chairman of the Committee on Education and the Workforce. "The department should be commended for its efforts to ensure that union leaders remain honest and accountable."

Robert B. Reich, labor secretary in President Bill Clinton's first term, said he sought to maintain the number of union audits during his tenure although they dropped off somewhat after the department reduced its staff by 12 percent as a cost-saving measure. Mr. Reich said he was surprised by the increase now, "because enforcement has been cut in other areas, like occupational safety and minimum wage enforcement."

"Unless there was some real evidence of an increase in union violations," Mr. Reich said, "I would think that other enforcement areas should be getting higher priority."

Department officials say enforcement in those other areas has not suffered. They note that the department collected $196 million in back pay last year for wage and hour violations, a 50 percent increase over 2001.

For years, many labor leaders have neglected to complete financial forms requiring them to disclose whether their union is doing business with relatives or whether they have received any money from employers. The Labor Department has recently informed unions that it expects far greater compliance in filling out those forms.

"I would think that union members will have much better information available through the reporting forms about how union resources are allocated and where their dues money is going," Mr. Yud said. "Our job is to prevent corruption, and that's what we'll continue to try to do."