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Office of Labor-Management Standards (OLMS)

U.S. Department of Labor Employment Standards Administration
Office of Labor-Management Standards
Kansas City Resident Investigator Office
2300 Main Street, Suite 1000
Kansas City, M0 641 082438
(81 6) 502-0290 Fax: (81 6) 502-0288

May 2, 2008

Mr. William Tanner, Treasurer
United Steelworkers AFL-CIO
Local 11-228
116 West Smith
Hesston, KS 67062
LM File Number 052-256
Case Number: -

Dear Mr. Tanner:

This office has recently completed an audit of Steelworkers Local 11-228 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 April 29,2008, 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.

Recordkeeping Violations

Title I1 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
Mr. NJilli2El T2n12el-
May 2,2008
Page 2 of 3
an expense receipt is not sufficiently descriptive, a union officer or employee should
wrik a note on ii providing the ad&tiord idomation. For money if 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 1122Vsm- records revealed the following recordkeeping
vielatiom:
1. Credit Card Expenses
Local 11-228 did not retain adequate documentation for credit card expenses
incurred by officers totaling at least $659. For example, a charge for $659 was
incurred for an officer to attend union training. No voucher was maintained for
this expenditure and the meal receipt did not identify the purpose of the meal or
the attendees.
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. Lost Wages
Local 11-228 did not retain adequate documentation for lost wage reimbursement
payments to union officers on at least 48 separate occasions. The union must
maintain records in support of lost wage claims that identify each date lost wages
were incurred, the number of hours lost on each date, the applicable rate of pay,
and a description of the union business conducted. The OLMS audit found that
Local 11-228 did not identify the union business conducted.
Based on your assurance that Local 11-228 will retain adequate documentation in the
future, OLMS will take no further enforcement action at this time regarding the above
violations.
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May 2,2008
Page 3 of 3
Other Issues
1. Personal Use of Credit Cards
The audit revealed that Local 11-228 permits officers and employees to use union
credit cards to pay for personal expenses. Although officers and employees
promptly repaid Local 11-ZB for the personal expenses charged, ~~ does not
recommend policies that allow personnel to make personal purchases with union
credit cards because this may lead to misuse of union funds.
2. Duplicate Receipts
OLMS recommends that Local 11-228 use a duplicate receipt system where the
union issues original pre-numbered receipts to all members who make payments
directly to the union and retains copies of those receipts. A duplicate receipt
system is an effective internal control because it ensures that a record is created of
income which is not otherwise easily verifiable. If more than one duplicate receipt
book is in use, the union should maintain a log to identify each book, the series of
receipt numbers in each book, and to whom each book is assigned.
I want to extend my personal appreciation to Steelworkers Local 11-228 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.
Sincerely,
Investigator
cc: Brian Lansaw, President