[Federal Register Volume 81, Number 102 (Thursday, May 26, 2016)]
[Rules and Regulations]
[Pages 33387-33389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-11611]


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DEPARTMENT OF LABOR

Office of Labor-Management Standards

29 CFR Parts 403 and 458


The Reorganization and Delegation of Authority for the Procedures 
Involving the Election of Officers in Federal Sector Labor 
Organizations; Filing Threshold for Simplified Annual Reports; and 
Instructions Regarding the Reports for Labor Organization Officer and 
Employee, Labor Organization Annual Report, Trusteeship, and Terminal 
Trusteeship

AGENCY: Office of Labor-Management Standards, DOL.

ACTION: Final rule; technical corrections.

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SUMMARY: The Office of Labor-Management Standards (OLMS) is making a 
number of technical corrections to its regulations and LM form 
instructions. OLMS is revising the instructions for the Form LM-30, 
Labor Organization Officer and Employee Report. OLMS is also amending a 
2003 final rule on labor organization annual reports in order to 
incorporate the previously updated filing threshold for smaller labor 
organizations with gross annual receipts totaling less than $250,000, 
make a technical correction to the instructions for the Form LM-2 Labor 
Organization Annual Report, Item 36 (Dues and Agency Fees), as well as 
to update the instructions for the Form LM-15, Trusteeship Report, and 
Form LM-16, Terminal Trusteeship Report. In addition, OLMS is amending 
a 2013 technical amendment implementing Secretary's Order No. 02-2012, 
which delegated appellate authority over certain federal sector labor 
organization officer election matters to the Administrative Review 
Board.

DATES: Effective May 26, 2016.

FOR FURTHER INFORMATION CONTACT: Andrew R. Davis, Chief of the Division 
of Interpretations and Standards, Office of Labor-Management Standards, 
U.S. Department of Labor, 200 Constitution Avenue NW., Room N-5609, 
Washington, DC 20210, [email protected], (202) 693-0123 (this is not 
a toll-free number), (800) 877-8339 (TTY/TDD).

SUPPLEMENTARY INFORMATION: 

Background

    The Form LM-30 final rule that is the subject of these corrections 
appeared in the Federal Register on October 26, 2011 (76 FR 66441); the 
final rule revised the Form LM-30, Labor Organization Officer and 
Employee Report, its instructions, and related provisions in the 
Department's regulations. The rule implemented section 202 of the 
Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), 29 
U.S.C. 432, whose purpose is to require officers and employees of labor 
organizations to report specified financial transactions, arrangements, 
and holdings to effect public disclosure of any possible conflicts of 
interest with their duty to the labor organization and its members. The 
Form LM-30 and instructions are referenced in 29 CFR part 404. See 29 
CFR 404.3 (Form of Annual Report).
    These corrections also amend a final rule published in the Federal 
Register on October 10, 2003 (68 FR 58374), concerning labor 
organization annual reports. In that rule, the Department increased the 
filing threshold for Form LM-2 filers from $200,000 to $250,000 in 
gross annual receipts. See 68 FR 58383. However, the rule did not make 
a corresponding amendment to the text of 29 CFR 403.4(a)(1) (Simplified 
annual reports for smaller labor organizations), which permits smaller 
labor organizations to file the simplified Form LM-3 if they do not 
have gross annual receipts that meet the filing threshold for the Form 
LM-2.
    Furthermore, the 2003 rule mandated electronic filing of the Form 
LM-2 for labor organizations with $250,000 or more in gross receipts. 
See 68 FR 58407. The instructions for the Form LM-2 were properly 
revised to reflect this requirement, but the rule did not update the 
instructions for the Form LM-15, Trusteeship Report, or the 
instructions for the Form LM-16, Terminal Trusteeship Report, both of 
which still contain references to the old paper format of the Form LM-
2. Pursuant to Title III of the LMRDA and the Department's regulations 
at 29 CFR part 408, the instructions for the Forms LM-15 and LM-16 
detail a parent organization's obligation to complete the Form LM-2 on 
behalf of a subordinate organization that it has placed in trusteeship.
    Moreover, today's corrections fix an omission in Section III of the 
instructions for the Form LM-16, by making clear that the treasurer of 
the parent union, in addition to the president (or corresponding 
principal officers), is required to sign the subordinate union's Form 
LM-2 report, pursuant to 29 U.S.C. 461(a). The Forms LM-16 and LM-16 
and instructions are referenced in 29 CFR part 408. See 29 CFR 408.3 
(Form of Initial Report) and 29 CFR 408.7 (Terminal Trusteeship 
Information Report).
    Additionally, these amendments correct a technical error in the 
instructions for Form LM-2 Labor Organization Annual Report, Item 36 
(Dues and Agency Fees), by clarifying an example concerning the 
reporting by a parent body and its subordinate for dues retained by the 
parent body from dues checkoff as payment for supplies purchased from 
the parent body by its subordinate. The Form LM-2 and instructions are 
referenced in 29 CFR part 403. See 29 CFR 403.3 (Form of Annual 
Financial Report--Detailed Report).
    Finally, these corrections amend a final rule published in the 
Federal Register on February 5, 2013 (78 FR 8022), concerning technical 
amendments implementing Secretary's Order No. 02-2012 (77 FR 69378),

[[Page 33388]]

which delegated appellate authority over certain federal sector labor 
organization officer election matters to the Administrative Review 
Board (ARB). That rule, in part, amended 29 CFR 458.65 by removing the 
references to ``Assistant Secretary,'' and adding in their place, the 
term ``Director'' in paragraphs (b) and (c). Upon review, the reference 
in paragraph (b) should have been replaced with a more general 
reference to the enforcement procedures outlined in 29 CFR 458.66 
through 458.92, as final decisions on challenged elections may be made 
by different officials depending on the applicable procedure. In 
addition, the reference in paragraph (c) should have been replaced by 
the term ``Administrative Review Board'' instead of the term 
``Director.''
    The rule also amended 29 CFR 458.70 by removing the references to 
``Assistant Secretary,'' and adding, in their place, ``Administrative 
Review Board'' in two places. However, in the last sentence of 29 CFR 
458.70, the rule did not replace the term ``he,'' which refers to the 
Assistant Secretary, with the more appropriate term ``it,'' for the 
ARB. Today's corrections make that change, consistent with the use of 
the term ``it'' in 29 CFR 458.91 and 458.93 in reference to the ARB, so 
that the sentence now reads as follow: ``The Administrative Review 
Board may order the remedial action set forth in the stipulated 
agreement or take such other action as it deems appropriate.''

Need for Corrections

    These amendments are necessary to correct the language in the Form 
LM-30 instructions concerning the scope of ``the filer,'' as 
encompassing the union official as well as his or her spouse and minor 
child.\1\ The Form LM-30 and the general instructions for Parts A, B, 
and C, as well as the language in Part II (Who Must File) of the 
instructions, make clear that ``you'' also refers to the official's 
spouse and minor child, not just the union official, and that this 
applies to the entire form. Further, this requirement derives directly 
from the statute. However, the specific instructions for Parts A and B 
simply refer to ``you,'' without mentioning spouse or minor child. This 
would not pose an issue, due to the aforementioned form and general 
instructions, but the instructions for Part C refer to ``you, your 
spouse, or your minor child.'' This difference in language may cause 
confusion as to whether the scope of Parts A and B includes the union 
official's spouse and minor children.
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    \1\ Note: the amendments to the instructions were published as 
appendices to the final rule and are not reproduced in the CFR.
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    These amendments are also necessary to correct the language in 29 
CFR 403.4(a)(1) to reflect the revised $250,000 filing threshold that 
was put in place pursuant to the October 2003 final rule on labor 
organization annual reports. As published, the final regulations did 
not update the filing threshold in 403.4(a)(1), which may prove to be 
misleading.
    These amendments are also necessary to correct the language in the 
Form LM-15 and Form LM-16 instructions concerning a parent 
organization's obligation to file and sign the Form LM-2 annual report 
of a subordinate organization that it has placed in trusteeship. The 
instructions refer to the outdated paper format of the Form LM-2 and 
omit, in one section of the Form LM-16, the statutory requirement for 
the parent organization's treasurer to also sign the subordinate's Form 
LM-2. As published, these instructions may prove to be misleading.
    Additionally, these amendments are necessary to correct an error in 
an example provided in the instructions for Form LM-2 Labor 
Organization Annual Report, Item 36 (Dues and Agency Fees). The 
instructions state that any amounts of dues checkoff retained by the 
parent or intermediate body other than per capita tax must be explained 
in Item 69 (Additional Information). As an example of such reporting by 
a parent body concerning dues checkoff retained for its subordinate 
body, the instructions state correctly that a parent body would explain 
in Item 69 (Additional Information) $500 retained from the dues 
checkoff as payment for supplies purchased from that body by the 
subordinate union. However, the example also states that the $500 
should not be reported as a receipt or disbursement by either the 
parent or subordinate body. These amendments are necessary to correct 
the example, by clarifying that the $500 would not be reported by the 
subordinate body as a receipt or disbursement. The parent body, 
however, would report the $500 as a receipt, in this case in Item 39 
(Sale of Supplies).
    Finally, these amendments are necessary to correct the language in 
29 CFR 458.65(b) to reflect the appropriate enforcement procedures and 
in 29 CFR 458.65(c) and 458.70 to make appropriate references for the 
ARB, pursuant to Secretary's Order No. 02-2012. As published, the final 
regulations erroneously replaced the term ``Assistant Secretary'' with 
the term ``Director'' in 29 CFR 458.65, which may prove to be 
misleading. In the last sentence of 29 CFR 458.70, the final 
regulations did not properly replace the term ``he'' with the term 
``it'' in reference to the ARB, which may prove to be misleading.

Corrections to Forms LM-30, LM-15, LM-16, and LM-2

    1. Part A (Represented Employer) of the Form LM-30 instructions, at 
5, is changed to read: Complete Part A if you, your spouse, or your 
minor child (1) held an interest in, (2) engaged in transactions or 
arrangements (including loans) with, or (3) derived income or other 
benefit of monetary value from, an employer whose employees your labor 
organization represents or is actively seeking to represent.
    2. Part B (Business) (a) of the Form LM-30 instructions, at 7, is 
changed to read: Complete Part B if you, your spouse, or your minor 
child held an interest in or derived income or other benefit with 
monetary value, including reimbursed expenses, from a business (1) a 
substantial part of which consists of buying from, selling or leasing 
to, or otherwise dealing with the business of an employer whose 
employees your labor organization represents or is actively seeking to 
represent, or (2) any part of which consists of buying from or selling 
or leasing directly or indirectly to, or otherwise dealing with your 
labor organization or with a trust in which your labor organization is 
interested. Report payments received as director's fees, including 
reimbursed expenses.
    3. In Section III (WHAT FORMS TO FILE) of the LM-15 instructions, 
at 2, the second paragraph of the subsection entitled ``Labor 
Organization Annual Report'' is changed to read: Any Form LM-2 filed on 
behalf of a trusteed organization must include the signatures of the 
trustees in addition to the signatures of the president and treasurer 
or corresponding principal officers of the organization which 
established the trusteeship. To add signature blocks to the Form LM-2 
in the electronic filing system, click on the ``Add Signature Block'' 
button on the bottom of page 1. If paper filing is permitted, trustees 
should sign and date the Form LM-2 in the space below the officers' 
signatures in Items 70 and 71.
    4. The last two sentences in Section III (WHAT FORMS TO FILE) of 
the LM-16 instructions, at 1, are changed to read: The Form LM-2 must 
contain the signatures of the trustees, in addition to the signatures 
of the president and treasurer or corresponding principal officers of 
the parent union. To add signature blocks to the Form LM-2 in the 
electronic filing system, click on the ``Add Signature Block'' button 
on the

[[Page 33389]]

bottom of page 1. If paper filing is permitted, trustees should sign 
and date the Form LM-2 in the space below the officers' signatures in 
Items 70 and 71.
    5. Amend instructions for Form LM-2 Labor Organization Annual 
Report, Item 36 (Dues and Agency Fees) to remove the term ``either'' in 
the third sentence of the second paragraph and adding ``the reporting'' 
in its place. The sentence would read as follows:

    For example, if the intermediate body or parent body retained 
$500 of the reporting organization's dues checkoff as payment for 
supplies purchased from that body by the reporting organization, 
this should be explained in Item 69, but the $500 should not be 
reported as a receipt or disbursement on the reporting 
organization's Form LM-2.

List of Subjects

29 CFR Part 403

    Labor unions, Reporting and recordkeeping requirements.

29 CFR Part 458

    Administrative practice and procedure, Government employees, Labor 
unions, Reporting and recordkeeping requirements.

    For reasons stated in the preamble, 29 CFR parts 403 and 458 are 
corrected by the following amendments:

PART 403--LABOR ORGANIZATION ANNUAL FINANCIAL REPORTS

0
1. The authority citation for part 403 continues to read as follows:

    Authority:  Secs. 201, 207, 208, 301, 73 Stat. 524, 529, 530 (29 
U.S.C. 431, 437, 438, 461); Secretary's Order No. 03-2012, 77 FR 
69376, November 16, 2012.


Sec.  403.4  [Amended]

0
2. In Sec.  403.4, in paragraph (a)(1), remove the term ``$200,000'' 
and add in its place ``$250,000''.

PART 458--STANDARDS OF CONDUCT

0
3. The authority citation for part 458 continues to read as follows:


    Authority:  5 U.S.C. 7105, 7111, 7120, 7134; 22 U.S.C. 4107, 
4111, 4117; 2 U.S.C. 1351(a)(1); Secretary's Order No. 03-2012, 77 
FR 69376, November 16, 2012; Secretary's Order No. 02-2012, 77 FR 
69378, November 16, 2012.

0
4. In Sec.  458.65, revise paragraphs (b) and (c) to read as follows:


Sec.  458.65  Procedures following actionable complaint.

* * * * *
    (b) The challenged election shall be presumed valid pending a final 
decision thereon as hereinafter provided in Sec. Sec.  458.66 through 
458.92, and in the interim the affairs of the organization shall be 
conducted by the officers elected or in such other manner as its 
constitution and bylaws may provide.
    (c) When the Chief, DOE supervises an election pursuant to an order 
of the Administrative Review Board issued under Sec.  458.70 or Sec.  
458.91, he shall certify to the Administrative Review Board the names 
of the persons elected. The Administrative Review Board shall thereupon 
issue an order declaring such persons to be the officers of the labor 
organization.

Sec.  458.70  [Amended]

0
5. In Sec.  458.70, amend the last sentence by removing the term ``he'' 
and adding in its place ``it''.

    Signed in Washington, DC, this 9th day of May, 2016.
Michael J. Hayes,
Director, Office of Labor-Management Standards.
[FR Doc. 2016-11611 Filed 5-25-16; 8:45 am]
 BILLING CODE 4510-CP-P