- The Washington Times - Wednesday, February 6, 2008

The nation’s largest labor organization has filed a lawsuit to block federal regulators from requiring unions to disclose more information about their officers’ finances.

The AFL-CIO says new rules by the Department of Labor “should be held unlawful and set aside,” according to a lawsuit recently filed against Labor Secretary Elaine L. Chao. The Labor Department says the new rules aim to help disclose potential conflicts of interest.

Under the regulations, officers and employees of a union in many cases must file a report with the Labor Department if they get loans or payments from vendors that do business with the union.

But attorneys for the AFL-CIO, which represents 55 unions and 10.5 million members, are criticizing the rules, saying Mrs. Chao doesn’t have the authority to enact the regulations.

The labor organization declined to comment on the lawsuit yesterday, but the AFL-CIO recently posted a statement on its Web site in which Sen. Hillary Rodham Clinton sharply criticized the regulations.

“Under the new rules, tens of thousands of union members will be forced, without justification, to navigate a bureaucratic maze of financial-disclosure forms and meet onerous reporting requirements about information as private as their personal mortgages and loans,” said Mrs. Clinton, New York Democrat.

Mrs. Clinton’s presidential bid has won the backing of the American Federation of State, County and Municipal Employees, which is one of more than 50 unions in the AFL-CIO and has committed to spending tens of millions of dollars to aid in her election.

The Labor Department, in its official rule-making notice last year, cited a dozen examples of questionable financial arrangements at unions, which regulators say could have been discovered through financial disclosures.

In one case, a union president owned the building where the union rented office space. In another, the spouse of a union employee owned an advertising company that received $245,000 in business from the union.

Andrew Auerbach, deputy director of the Office of Labor Management Standards, yesterday said the labor-reporting requirements have been in place for more than 40 years, and that many of the provisions have been mandated for years.

“The idea behind the legislation was to get information about the union to its members so they can make good decisions,” he said.

Labor unions and the Bush administration have been at odds for years over financial-reporting requirements.

“The unions see this as overly burdensome, and the Bush administration would say it’s about transparency,” said Don Lee, a labor lawyer for Ford & Harrison LLP in Atlanta.

The Labor Department was served with the AFL-CIO’s lawsuit last week and hasn’t yet responded. The complaint was filed in federal court in the District last month.

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