U.S. Department of Labor
Office of Labor-Management Standards
Cleveland District Office
1240 East 9th Street, Suite 831
Cleveland, OH 44199
(216) 357-5455 Fax: (216) 357-5425
August 6, 2010
Ms. Marilyn Oliver, Treasurer
NABET Local 42
6625 Harborside Lgd.
Mentor, OH 44060 Case Number: ||||||||||||||||||||||||||||||
LM Number: 013035
Dear Ms. Oliver:
This office has recently completed an audit of NABET Local 42 under the Compliance Audit Program (CAP) to determine your organization’s compliance with the provisions of the
Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). As discussed during the exit interview with you, President William Wachenschwanz, and Vice President Jim Kolendo on
July 20, 2010, the following problems were disclosed during the CAP. The matters listed below are not an exhaustive list of all possible problem areas since the audit conducted was limited in scope.
Reporting Violations
The audit disclosed a violation of LMRDA Section 201(b), which requires labor organizations to file annual financial reports accurately disclosing their financial condition and operations. The Labor Organization Annual Report LM-3 filed by Local 42 for the fiscal year ended
September 30, 2009 was deficient in the following areas:
1. Acquire/Dispose of Property
Item 13 (During the reporting period did your organization acquire or dispose of any assets in any manner other than by purchase or sale?) should have been answered, "Yes," because the union gave away polo shirts totaling more than $3,500 during the year. The union must identify the type and value of any property received or given away in the additional information section of the LM report along with the identity of the recipient(s) or donor(s) of such property. The union does not have to itemize every recipient of such giveaways by name. The union can describe the recipients by broad categories if appropriate such as “members” or “new retirees.” In addition, the union must report the cost, book value, and trade-in allowance for assets that it traded in.
2. Disbursements to Officers
Local 42 did not include lost time payments paid by the local to employers on behalf of officers and some reimbursements to officers in the amounts reported Item 24 (All Officers and Disbursements to Officers). It appears the union erroneously reported these payments in Item 48, Office and Administrative Expenses.
The union must report most direct disbursements to Local 42 officers and some indirect disbursements made on behalf of its officers in Item 24. A "direct disbursement" to an officer is a payment made to an officer in the form of cash, property, goods, services, or other things of value. See the instructions for Item 24 for a discussion of certain direct disbursements to officers that do not have to be reported in Item 24. An "indirect disbursement" to an officer is a payment to another party (including a credit card company) for cash, property, goods, services, or other things of value received by or on behalf of an officer. However, indirect disbursements for temporary lodging (such as a union check issued to a hotel) or for transportation by a public carrier (such as an airline) for an officer traveling on union business should be reported in Item 48 (Office and Administrative Expense).
3. Failure to File Bylaws
The audit disclosed a violation of LMRDA Section 201(a), which requires that a union submit a copy of its revised constitution and bylaws with its LM report when it makes changes to its constitution or bylaws. Local 42 amended its constitution and bylaws in 2008, but did not file a copy with its LM report for that year.
Local 42 has now filed a copy of its constitution and bylaws.
I am not requiring that Local 42 file an amended LM report for fiscal year ended
September 30, 2008 to correct the deficient items, but Local 42 has agreed to properly report the
deficient items on all future reports it files with OLMS.
I want to extend my personal appreciation to NABET Local 42 for the cooperation and courtesy extended during this compliance audit. I strongly recommend that you make sure this letter and the compliance assistance materials provided to you are passed on to future officers. If we can provide any additional assistance, please do not hesitate to call.
Sincerely,
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Investigator
cc: Mr. William Wachenschwanz, President