Labor Organization Oversight: Department of Labor Should Enhance Enforcement and Assistance Processes
Fast Facts
Unions negotiate with employers about pay, safety, and policies. The Labor Department's Office of Labor-Management Standards aims to ensure that unions are transparent in their finances and protect the democratic rights of their members. The office audits, investigates, and helps unions comply.
When the office finds a problem—such as a recordkeeping violation that could make union funds vulnerable to theft—it mostly relies on voluntary compliance to fix it and doesn't usually follow up. The office's written communications also don't consistently ensure that the unions have the guidance they need.
We recommended addressing these issues and more.
Highlights
What GAO Found
The Department of Labor undertakes several efforts to enforce the requirements of the Labor-Management Reporting and Disclosure Act (LMRDA), but it could improve its processes to ensure violations are adequately addressed. Each year, the department's Office of Labor-Management Standards (OLMS) selects some labor organizations for audits of their financial reports, based on factors such as member complaints, to ensure financial integrity. Most audits identified reporting and recordkeeping violations, but OLMS's response to addressing them varies. OLMS primarily relies on voluntary compliance—an organization's promise to maintain accurate reports and proper records in the future—to address recordkeeping violations. Some recordkeeping violations could reveal weaknesses that leave labor organizations vulnerable to theft and misuse of funds. However, OLMS has not assessed whether assurances of voluntary compliance result in corrective actions. As a result, OLMS does not know if its focus on voluntary compliance is an effective means to ensure labor organizations are adequately safeguarding members' dues.
Selected OLMS Enforcement and Compliance Assistance Activities
To support compliance, OLMS provides over 50 publications covering all sections of LMRDA requirements, but the agency does not have a mechanism to cite them in audit closing letters when relevant. Specifically, in GAO's review of 172 closing letters—which OLMS uses to summarize violations it identifies and cite available assistance—from 2023, letters did not consistently reference publications that could help labor organizations address recordkeeping violations. For example, 46 closing letters with violations were related to documenting credit card expenses, and none referenced a related publication. According to OLMS officials, investigators determine which publications to reference on a case-by-case basis. However, OLMS does not have a systematic process to help investigators consistently cite related guidance in audit closing letters. This may leave labor organizations unaware of the available resources to address violations and comply with the LMRDA.
Why GAO Did This Study
On behalf of their members, labor organizations negotiate collective bargaining agreements related to pay, safety, and workplace policies. OLMS promotes transparency and financial integrity in labor organizations through its enforcement of LMRDA. In part, this law aims to prevent improper practices by labor organizations and protect the rights and interests of their members. OLMS pursues this goal through audits, investigations, and compliance assistance.
GAO was asked to review how OLMS administers LMRDA provisions that apply to labor organizations. This report examines the extent to which OLMS (1) ensures labor organizations adhere to LMRDA requirements and (2) helps labor organizations comply with LMRDA requirements. GAO reviewed relevant federal laws, annual reports and compliance assistance publications, and all 172 compliance audit closing letters issued in calendar year 2023, the most recent available at the onset of GAO's review. GAO also analyzed fiscal year 2019 to 2023 enforcement and compliance assistance data and interviewed OLMS national and regional officials.
Recommendations
GAO is making seven recommendations, including that OLMS assess voluntary compliance results and establish a mechanism to cite related publications in audit closing letters. The Department of Labor concurred with all seven recommendations. In its comments, the agency outlined its plans to implement them.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Labor | The Secretary of Labor should ensure the Director of OLMS establishes written criteria investigators can apply when determining whether to require an amended financial disclosure report following a compliance audit. (Recommendation 1) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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| Department of Labor | The Secretary of Labor should ensure the Director of OLMS assesses whether voluntary compliance results in labor organizations taking corrective action after violations are identified during a compliance audit. For example, OLMS could regularly follow up on a sample of violations to help estimate how often voluntary compliance results in an actual change of behavior. (Recommendation 2) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should ensure the Director of OLMS establishes documented procedures to track labor organizations that OLMS officials determine merit follow up based on past violations identified during a compliance audit. (Recommendation 3) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should ensure the Director of OLMS develops a mechanism to cite related compliance assistance publications in compliance audit closing letters. (Recommendation 4) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should ensure the Director of OLMS establishes a systematic process to regularly review and update as needed its compliance assistance publications. For example, OLMS could use information on common violations identified in its compliance audits to assess whether there are any gaps in topics covered by its publications. (Recommendation 5) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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| Department of Labor | The Secretary of Labor should ensure the Director of OLMS establishes a systematic process to collect and track feedback from compliance assistance sessions, ensuring feedback is used for program improvement across all regions. (Recommendation 6) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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| Department of Labor | The Secretary of Labor should ensure the Director of OLMS develops a strategy for conducting effective outreach to members of labor organizations. This could include leveraging existing partnerships, such as the Voluntary Compliance Partnership Program, to solicit ideas on improving member engagement or informing members about their rights. (Recommendation 7) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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