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Office of Labor-Management Standards (OLMS)

OLMS News

Number: 04-07

January 26, 2007

Labor Department Publishes Reasoned Analysis in Response to Court’s Remand Order in Alabama Education Association v. Chao

The U.S. Department of Labor published in today’s Federal Register a Policy Statement in response to the court's remand order in Alabama Education Ass'n v. Chao, 455 F.3d 386 (D.C. Cir. 2006), a case concerning the definition of a labor organization under the Labor-Management Reporting and Disclosure Act (LMRDA). Under the definition discussed in the Policy Statement, a labor union on the middle level of a union hierarchy (an intermediate body) will be covered by the LMRDA if it is subordinate to a national or international labor organization that is covered by the LMRDA. Thus, generally, even those intermediate labor unions that consist solely of local unions that are exempt from the LMRDA because they represent public sector employees will be covered by the LMRDA if they are subordinate to a covered labor organization. Unions covered by the LMRDA, among other things, must file annual financial disclosure reports.

On December 27, 2002, the Department issued a Notice of Proposed Rulemaking (NPRM) that proposed revisions to the forms that labor organizations use to file annual financial reports (Forms LM-2, LM-3 and LM-4) required by the LMRDA. Prior to the NPRM, the Department interpreted the LMRDA to require that an intermediate labor union consist of at least one local union that is covered by the LMRDA before the intermediate body would be considered covered by the LMRDA. The Department proposed to change this interpretation.

On October 9, 2003, the final rule was published revising Forms LM-2 and LM-3. The interpretation in the final rule stated that intermediate bodies will be covered by the LMRDA if they are subordinate to a national or international labor organization that includes a labor organization covered by the LMRDA, even if the intermediate body's constituents are solely public sector local labor unions not covered by the Act.

This interpretation of the LMRDA was challenged in federal district court, and the court granted summary judgment in favor of the labor unions. Alabama Education Ass'n v. Chao, 2005 WL 736535 (D.D.C. Mar 31, 2005). On appeal, the U.S. Court of Appeals for the District of Columbia Circuit reversed the grant of summary judgment. Alabama Education Ass'n v. Chao, 455 F.3d 386 (D.C. Cir. 2006). One prong of the court’s conclusion was that the Department had failed to provide a "reasoned analysis supporting its change of position," and the court remanded the rule to the Department to provide such analysis.

To view the Policy Statement, visit
http://a257.g.akamaitech.net/7/257/2422/01jan20071800/
edocket.access.gpo.gov/2007/E7-1275.htm
.
An Adobe version is available at http://www.dol.gov/regs/compliance/olms/fedregister012607.pdf.

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Last Updated: 01/31/07

 

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