As we evaluate the impact of the past year on the nation’s workforce, it is worthwhile to remember the accomplishments of President Bush’s Secretary of Labor, Elaine L. Chao.

When Secretary Chao left office, workers were safer in their workplaces than at any time in history, the Labor Department was focused upon encouraging private sector job creation, and created an enforcement environment that successfully protected workers from employers who egregiously violated the law while providing the necessary education to limit inadvertent violations.

Secretary Chao put an emphasis on clarifying workplace regulations to make it easier for employers to know the rules of the game.  Her efforts led to overtime requirements being more clear-cut for employers while explicitly guaranteeing overtime protections for blue collar workers, police and fire fighters, EMTs, construction workers and others.

The Labor Department under Secretary Chao brought transparency to the spending of Big Labor through regulations which for the first time shined a light upon labor union expenditures.  These reports revealed the massive labor expenditures supporting ACORN’s efforts,and were used by LA Times reporter Paul Pringle in his Polk Award winning series that brought down the SEIU powerbrokers in the California SEIU.

This emphasis on transparency and private sector education and empowerment was geared toward preparing America’s workforce for the 21^st century, all the while protecting the taxpayer by achieving cost savings in the Department’s discretionary budget of 19 percent in real terms since 2001.

The Obama Administration’s agenda is very different.

The first order of business has been rolling back those pesky union transparency regulations that allowed watchdog groups, the media and union members to know how union dues are spent.

Next, rather than getting out of the way and allowing the private sector engine to create jobs, the Obama Administration is hiring hundreds more OSHA and Wage and Hour inspectors with their job descriptions revised away from helping companies comply with the law to strictly writing citations for as much fine money as can possibly be warranted.

Believe it or not, in spite of record lows in workplace injuries, OSHA inspectors are now financially incentivized to write citations with heavy fines encouraged.  This is akin to making a police officer’s income directly related to how many tickets he/she writes.  If you have the misfortune of getting pulled over, you know that it is going to cost you big time.

Continuing on the enforcement front, it is instructive that President Obama’s appointee to be the top lawyer in the Department is Patricia Smith who currently serves as the head of the New York State Department of Labor.  In New York, Smith created a program that empowers unions to conduct wage and hour inspections of employers – typically, non-union employers.  This powerful coercion tool is conducted under the guise of ensuring that employees are treated fairly, but actually allows a union to target employers for organizing programs using this threat as a cudgel against that business.

The theme of expanding private sector union membership permeates the entire Obama labor agenda from the recently announced deal on the health care bill which exempts union members from paying a tax on what is deemed to be Cadillac health care insurance, to the Orwellian named Employee Free Choice Act that strips employees of secret ballot union elections, to Obama appointees changing union election rules that have stood for 75 years in order to help unions organize Delta Airlines.

This emphasis on expanding union membership, even at the expense of job creation, can be seen in one of the Administration’s early acts – to require Project Labor Agreements (PLAs) for federally funded projects.  PLAs require scale union wages be paid on all federally funded construction at an estimated cost of between 16-18%.

That’s shovel ready money that is employing fewer workers for the taxpayer dollar – all to force work into union shops and increase union dues payments.  Rather than employing more workers in this time of economic crisis, Obama instead has chosen to employ fewer people per taxpayer dollar in order to ensure that union dues payments go up.  Of course, the poster child for PLA projects is the notorious Boston Big Dig that ran billions of dollars of cost overruns while having to redo much of the work due to poor workmanship.  Of course what else can you expect when using union labor is more important than getting the job done.

PLA’s are not the only example of this Administration putting union membership ahead of job creation.  Amazingly, one of the requirements for consideration to receive a piece of the $100 million in “green job grants” was a partnership with a union affiliated group.  While union affiliation has nothing to do with whether or not a job is green or not, these grants are structured to force companies competing for these grants to employ union labor and at the least give labor affiliated organizations a piece of the pie.

At this writing, the 60 vote filibuster proof Democratic Senate was predicted to go down in flames in Massachusetts.  As a result, regulators, appointees to the National Labor Relations Board and Administrative Law judges are likely to be at the forefront of employment policy.  One name stands out as perhaps the symbol of the changes that we are likely to see in the Obama Administration – Craig Becker.

The Wall Street Journal calls Becker, “labor’s secret weapon”.  So who is he?

Becker is a yet to be confirmed appointee who would be the deciding vote on the National Labor Relations Board – the decision making body on the rules and validity of union organizing elections.

Instead of being a fair arbiter, Becker has advocated for extensive restrictions on employer communications with employees preceding a union organizing vote.  He has gone so far as to call for employers to be barred from attending NLRB hearings about elections, and not allowing employers to  challenge results even when evidence of union misconduct is present.  If confirmed it is likely that Craig Becker, not Hilda Solis, will have the lasting impact  on labor relations whether Congress passes the Employee Free Choice Act or not.

You might ask yourself, why is this Administration feverishly working to tilt the employment playing field dramatically toward the unions at the expense of real job creation?

The answer may be found in those very union disclosure reports that the Obama Administration doesn’t want you to see.

Big Labor is broke and desperate.  Declining membership combined with hundreds of millions in political expenditures to elect this Administration and Congress have left them on the financial ropes.

To understand the severity of their situation, you only have to go to the Wall Street Journal which reports that the AFL-CIO has more liabilities than assets, and a key member of their Finance Board worries that, “insolvency may be just around the corner.”  Further, Number One White House visitor, Andy Stern’s SEIU’s, is in severe financial trouble with his pension plans upside down and the union’s liabilities totalling almost 80% of its assets, and Jimmy Hoffa, Jr.’s International Brotherhood of Teamsters faces a pension disaster as its Central States Pension Fund teeters on ruin with an asset to liability ratio of only 43%.  In short, Big Labor’s finances are worse than a Wall Street mortgage derivatives fund in 2008, and like Wall Street, they are looking for government to bail them out.

Big Labor has bet their entire future on this Administration and this Congress.  Not able to compete in an environment where workers are safer than ever before, and there is a big screen in every living room, Big Labor needs the rules changed in order to survive, no matter the harm done to America and to workers across our nation.

The Associate Press reports:

The president of a national railroad employees union was arrested at his Ohio home on Tuesday and charged with bribery.

Edward Rodzwicz, who heads the Brotherhood of Locomotive Engineers and Trainmen, is accused of soliciting and accepting $20,000 in bribes from a St. Louis lawyer. In exchange, prosecutors say, Rodzwicz allowed the lawyer to remain on a list of attorneys approved to handle injury cases for union members.

But wait a minute, we’ve seen this type of bribe before!  On the undercover video provided on the National Right To Work Committee’s YouTube channel embedded below, a different railroad union official accepted a bribe from a trial lawyer.  This videotape was part of an investigation that put two former union presidents in jail:

The Obama Administration has loaded the U.S. Department of Labor with Big Labor cronies whose central mission appears to be hiding union boss perks and conflicts of interests from rank-and-file workers who pay their salaries. 

About the time the Justice Department put together the sting operation using investigators from the Department of Labor and the FBI (shown in video above); several trial lawyers began to meet to decide how to avoid reporting their payments to union officials in this pay-to-play scheme.  Two lawsuits were eventually filed against Secretary Elaine Chao in an attempt to stop the Labor Department’s enforcement of this conflict-of-interest reporting requirements. 

More shocking is that the Obama Labor Department cited these lawsuits as part of the reason for its decision not to enforce conflict-of-interest disclosure for union bosses:

“Fundamental questions regarding the scope and extent of the reporting obligations are unanswered, and litigation challenging some aspects of the form remains pending.  Yet, by March 31, 2009, reports for calendar year 2008 must be filed.  In light of this uncertainty, the pending regulatory action, the pending litigation and the rapidly approaching filing deadline, OLMS has determined that it would not be a good use of resources to bring enforcement actions based upon a failure to use a specific form to comply with the statutory obligation to report certain financial information.”

The lawyers lost their appeal, but there is still hope for these train-chasing trial lawyers that Labor Secretary Hilda Solis and her big labor insiders will rewrite this disclosure to the trial lawyers’ liking as she began last Friday to do for union bosses by rescinding meaningful union financial disclosure.  

It appears that the Obama Administration has chosen to play Chicago-style insider politics rather than protect rank-and-file workers.  They continue to completely ignore the real burdens placed on workers by union officials who have the power to fire workers for failure to pay union dues as a condition of getting and keeping a job.  Then, they use this power to force workers to pay for union bosses’ perks.

Solis’ excuse for rescinding important union financial disclosure was that the rule put a “burden” on union officials who failed to file required reports.  In other words, she did not want to burden union officials who were ignoring the law.  Further, she also stopped enforcement of union officer conflict-of-interest disclosure reporting requirements. 

Under this Administration, we should expect to see many more of these pay-to-play deals with union bosses.

Why the hurry? Perhaps Union Bosses wanted to prevent the Virginia GOP and inquisitive people like Patrick Semmens from visiting DOL’s UnionReports.gov website that clearly reveals the Big Labor-ACORN collusion.  Semmens discovered that teachers’ union bosses gave about $500,000 to the same Brooklyn ACORN office exposed on BigGovernment.com.  Both the National Education Association (NEA) and the American Federation of Teachers (AFT) awarded ACORN service contracts.

That’s right; union bosses gave teachers’ forced union dues to the same ACORN that appeared to have no problem facilitating child prostitution.  No wonder Solis’ Big Labor friends want to shutdown financial disclosure!

In fact, UnionReports.gov provides detailed union financial reports and is a primary source for many union members, reporters, columnists, bloggers, and researchers.  But, the days of disclosure are numbered.  Big Labor has commanded Labor Secretary Solis to shut it all down. 

Will Big Labor’s ties with ACORN be hidden again?

In 2003, some sunlight began to shine on union financial disclosure revealing payments to groups like ACORN. 

Itemized ACORN payments were previously hidden somewhere in reports like the 2004 NEA LM-2 report below.   A quick comparison of NEA financial disclosure reports appears below illustrating the value of the reformed 2008 report verses the 2004 pre-reform disclosure. (For the entire reports, please click the following links: 2004 and 2008 NEA LM-2 reports.) 

NEA Disclosure before Bush Administration Reforms (2004)

Somewhere in the NEA’s 2004 LM-2 Schedules 12 and 13 are disbursements to groups like ACORN, but how was anyone to know? Where did the union dues go?

After years of battling big labor lawyers, the Bush Administration prevailed in court creating a LM-2 financial disclosure report that union members and researchers have found informative. The image below is just one of the several hundred 2008 itemized NEA disbursement.   

NEA Disclosure after Bush Administration Reforms (2008)

“Nonpartisan voter registrant*CONTRIB DONATIONS/GIF”, Really? Well, at least the reformed disclosure provides the recipient ACORN and its address.  

Note: In 2003, the AFL-CIO’s disdain toward ‘informed’ workers was apparent in its 2003 official comment to the Labor Department. It claimed that these reports would be too confusing for union members:

Such enormous masses of data do nothing to simplify, condense and aggregate financial information into meaningful totals that unions’ members could use to understand the financial status of their union. Rather, the proposal would disclose massive amounts of non-material financial data, with the result that union members will be distracted and confused in their efforts to parse out what is meaningful in the LM-2 versus what is simply noise.

U.S. Big Labor Department swings into action

Instead of focusing on the economy or the alarming unemployment trends, Obama’s Big Labor Department seems to have focused little on the men and women behind those numbers.  Instead, Secretary Solis has focused like a laser beam on eliminating disclosure of labor bosses perks and their spending of money collected as a condition of employment from millions of workers.

This screenshot of Obama’s Big Labor Department swinging into action to help union bosses clearly illustrates the priority:

Regulations.gov

And that is not all; Obama’s Labor Department creatively and without rulemaking eliminated 2008 Bush Administration reform of Labor Officer conflict-of-interest reporting.  The following is the de facto rulemaking:

Note: The Office of Labor-Management Standards will publish in the spring 2009 Semi-Annual Regulatory Agenda notice of an intended rulemaking to revise the Form LM-30 (Labor Organization Officer and Employee [Conflict-of-Interest] Report).  The rulemaking is intended to review questions of policy and law surrounding these reporting requirements.  The rulemaking will focus on the changes resulting from a 2007 regulatory revision of the Form and instructions.  This revision dramatically altered the old Form LM-30 and instructions, which had not substantially changed in over 40 years.  Despite the promulgation of the new Form LM-30, fundamental questions regarding the scope and extent of the reporting obligations are unanswered, and litigation challenging some aspects of the form remains pending.  Yet, by March 31, 2009, reports for calendar year 2008 must be filed.  In light of this uncertainty, the pending regulatory action, the pending litigation and the rapidly approaching filing deadline, OLMS has determined that it would not be a good use of resources to bring enforcement actions based upon a failure to use a specific form to comply with the statutory obligation to report certain financial information.  Accordingly, OLMS will refrain from initiating enforcement actions against union officers and union employees based solely on the failure to file the report required by section 202 of the Labor-Management and Reporting Disclosure Act (LMRDA), 29 U.S.C. § 432, using the 2007 form, as long as individuals meet their statutorily-required filing obligation in some manner.  OLMS will accept either the old Form LM-30 or the new one for purposes of this non-enforcement policy.  [Emphasis added]

So, Big Labor Bosses can submit whatever they want. The action by Secretary Solis and her Department essentially allows officers to create their own reporting form.  If only the IRS were so accommodating.

Why has there been no more action?

Secretary Solis had been rolling out the elimination of union financial disclosure on a monthly basis; however, since the LM-2 rescission comment period ended in May, the Obama Administration eraser has yet to be applied.

Could it be that several well reasoned comments, such as the submissions filed by Mark Mix and Bob Hirsch to name two, actually reminded Secretary Solis that the congressional intent of the Act was to provide the disinfecting benefit of sunlight to the old-boy networked secretive union financial world? I would like to think so, but likely it has more to do with a 1959 congress well aware that the success of the Labor-Management Reporting Disclosure Act depended on the Labor Secretary’s desire to protect the individual workers rather than curry favor with labor bosses.  And, that point was brought out in The National Right To Work Legal Defense Foundation’s comments:

Rescission Exceeds Secretary’s Authority

Rules and regulations; simplified reports*

The Secretary shall have authority to issue, amend, and rescind rules and regulations prescribing the form and publication of reports required to be filed under this subchapter and such other reasonable rules and regulations (including rules prescribing reports concerning trusts in which a labor organization is interested) as he may find necessary to prevent the circumvention or evasion of such reporting requirements. In exercising his power under this section the Secretary shall prescribe by general rule simplified reports for labor organizations or employers for whom he finds that by virtue of their size a detailed report would be unduly burdensome, but the Secretary may revoke such provision for simplified forms of any labor organization or employer if he determines, after such investigation as he deems proper and due notice and opportunity for a hearing, that the purposes of this section would be served thereby. (Emphasis added)

Based upon the Department’s reasoning, the Secretary will exceed her statutory authority if she rescinds the 2009 LM-2 reform.  The LMRDA limits the Secretary’s ability to rescind a rule to specified circumstances: if it will prevent the circumvention or evasion of the Act.  The Department has provided no reason how rescission will enhance disclosure by reducing circumvention or evasion.  Rather the Secretary concedes disclosure will be undermined by rescission.

It was 1959, only two years after Robert F. Kennedy, author of The Enemy Within, exposed one corrupt union after another during senate hearings, and perhaps Congress was all too aware of the dangers of allowing disclosure to disappear.

Clearly, the words, “The Secretary shall have authority to issue, amend, and rescind rules and regulations … as he may find necessary to prevent the circumvention or evasion of such reporting requirements.”  do not grant Secretary Solis the authority to rescind disclosure that by the Department’s own admission will aid in the evasion of the Act.  Undoubtedly, Solis’ plan to eliminate disclosure will only aid in circumventing the disclosure, not preventing it. 

The lesson from history is that the most effective solution to the corrupting influence of union monopolistic bargaining power is not trying to tame it as tried in 1959; rather it is to eliminate the act of forcing workers to pay a labor union as condition of employment.  The monopolist bargaining power granted to labor bosses by President Franklin Roosevelt established a tax on workers and essentially gave a non-governmental entity, labor unions, the power to tax every working American and control each worker’s ability to stand apart from others.  And, this monopoly bargaining power can be awarded without a worker’s consent. 

Now is not the time to relax

But, don’t relax. Even though it appears that Secretary Solis’ first attempt at reducing disclosure may be on hold for now; all you would be James O’Keefes and Hannah Gileses out there looking for another ACORN in union reports, had better act quickly before the Obama Administration finds another way to douse the sunlight.

*U.S. Code – Title 29, SUBCHAPTER III—REPORTING BY LABOR ORGANIZATIONS, OFFICERS AND EMPLOYEES OF LABOR ORGANIZATIONS, AND EMPLOYERS, § 438. Rules and regulations; simplified reports