Office of Labor-Management Standards (OLMS)
U.S. Department of Labor Employment Standards Administration
Office of Labor-Management Standards
Seattle District Office
1111 Third Avenue
Seattle, WA 981 01 -321 2
(206)398-8099 Fax: (206)398-8090
August 22, 2008
Mr. Donald Patterson, Financial Secretary-Treasurer/Business Manager
Iron Workers AFL-CIO
16610 East Euclid
Spokane, Washington 99216-1808
Dear Mr. Patterson:
This office has recently completed an audit of Iron Workers Local 14 under the Compliance Audit Program (CAP) to determine your organization's compliance with the provisions of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). As discussed during the exit interview with you on August 1,2008, the following problems were disclosed during the CAP. The matters listed below are not an exhaustive list of all possible problem areas since the audit conducted was limited in scope.
Title II of the LMRDA establishes certain reporting and recordkeeping requirements. Section 206 requires, among other things, that labor organizations maintain adequate records for at least five years by which each receipt and disbursement of funds, as well as all account balances, can be verified, explained, and clarified. As a general rule, labor organizations must maintain all records used or received in the course of union business.
For disbursements, this includes not only original bills, invoices, receipts, vouchers, and applicable resolutions, but also documentation showing the nature of the union business requiring the disbursement, the goods or services received, and the identity of the recipient(s) of the goods or services. In most instances, this documentation requirement can be satisfied with a sufficiently descriptive expense receipt or invoice. If an expense receipt is not sufficiently descriptive, a union officer or employee should write a note on it providing the additional information. For money it receives, the labor organization must keep at least one record showing the date, amount, purpose, and source of that money. The labor organization must also retain bank records for all accounts.
The audit of Local 14's 2008 records revealed the following recordkeeping violations:
1. Credit Card Expenses
Local 14 did not retain adequate documentation for credit card expenses incurred by union officers and employees. For example, a 2 month sample of credit card expenses revealed that Local 14 did not maintain receipts for credit card expenses totaling at least $6,014.31.
As previously noted above, labor organizations must retain original receipts, bills, and vouchers for all disbursements. The president and treasurer (or corresponding principal officers) of your union, who are required to sign your union's LM report, are responsible for properly maintaining union records.
2. Meal Expenses
Local 14 did not require officers and employees to submit itemized receipts for meal expenses totaling at least $345.53 during the 2 months examined. The union must maintain itemized receipts provided by restaurants to officers and employees. These itemized receipts are necessary to determine if such disbursements are for union business purposes and to sufficiently fulfill the recordkeeping requirement of LMRDA Section 206.
Local 14 records of meal expenses did not always include written explanations of union business conducted or the names and titles of the persons incurring the restaurant charges. For example, 17 meal receipts for the 2 months examined did not list the names and titles of the persons incurring the charges or the union business conducted. Union records of meal expenses must include written explanations of the union business conducted and the full names and titles of all persons who incurred the restaurant charges. Also, the records retained must identify the names of the restaurants where the officers or employees incurred meal expenses.
3. Disposition of Property
Local 14 did not maintain an inventory of hats, shirts, and other property it purchased, sold, or gave away. The union must report the value of any union property on hand at the beginning and end of each year in Item 28 of the LM-2. The union must retain an inventory or similar record of property on hand to verify, clarifv, and explain the information that must be reported in Item 28. The union must record in at least one record the date and amount received from each sale of union hats, shirts and other items.
Based on your assurance that Local 14 will retain adequate documentation in the future, OLMS will take no further enforcement action at this time regarding the above violations.
I want to extend my personal appreciation to Iron Workers Local 14 for the cooperation and courtesy extended during this compliance audit. I strongly recommend that you make sure this letter and the compliance assistance materials provided to you are passed on to. future officers. If we can provide any additional assistance, please do not hesitate to call.
cc: Mel Fitzpatrick, Local 14 President