U.S. Department of Labor
Office of Labor-Management Standards
Seattle District Office
1111 Third Avenue, Suite 605
Seattle, WA 98101
(206) 398-8099 Fax: (206) 398-8090
March 4, 2011

Mr. Robert Collins, President
ILWU LU 21 Kalama Export Division
PO Box 1136
Kalama, WA 98625

Case Number:
LM Number: 540231

Dear Mr. Collins:

This office has recently completed an audit of ILWU LU 21 Kalama Export Division 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 on March 8, 2011, 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.

Recordkeeping Violations

Title II of the LMRDA establishes certain reporting and recordkeeping requirements. Section
206 requires, among other things, that labor organizations maintain adequate records for at least
five years by which each receipt and disbursement of funds, as well as all account balances, can
be verified, explained, and clarified. As a general rule, labor organizations must maintain all
records used or received in the course of union business.

For disbursements, this includes not only original bills, invoices, receipts, vouchers, and
applicable resolutions, but also documentation showing the nature of the union business
requiring the disbursement, the goods or services received, and the identity of the recipient(s) of
the goods or services. In most instances, this documentation requirement can be satisfied with a
sufficiently descriptive expense receipt or invoice. If an expense receipt is not sufficiently
descriptive, a union officer or employee should write a note on it providing the additional
information. For money it receives, the labor organization must keep at least one record showing
the date, amount, purpose, and source of that money. The labor organization must also retain
bank records for all accounts.

The audit of Local 21’s 2010 records revealed the following recordkeeping violations:

1. General and Debit Card Expenses
Local 21 did not retain adequate documentation for general and debit card expenses incurred

by union officers totaling at least $11,300.49. For example, 45 out of 53 disbursements were

not supported with a union record. These payments were for retirement gifts, per capita tax

payments, monthly meeting room rental, cash door prizes, and 13 debit card purchases to

replenish the vending machine.


Mr. Robert Collins
July 6, 2011
Page 2 of 2

As previously noted above, labor organizations must retain original receipts, bills, and vouchers
for all disbursements. The president and treasurer (or corresponding principal officers) of your
union, who are required to sign your union’s LM report, are responsible for properly maintaining
union records.

2. Lack of Salary Authorization
Local 21 did not maintain records to verify that the monthly salaries totaling $3300 was the
authorized amount. The union must keep a record, such as meeting minutes, to show the
current salary authorized by the entity or individual in the union with the authority to
establish salaries.

3. Receipt Dates not Recorded
Entries in Local 21’s general ledger do not reflect the date the union deposited money, or the
date money was received. Union receipt records must show the date of receipt. The date of
receipt is required to verify, explain, or clarify amounts required to be reported in Statement
B (Receipts and Disbursements) of the LM-3. The LM-3 instructions for Statement B state
that the labor organization must record receipts when it actually receives money and
disbursements when it actually pays out money. Failure to record the date money was
received could result in the union reporting some receipts for a different year than when it
actually received them

Based on your assurance that LU 21 will retain adequate documentation in the future, OLMS
will take no further enforcement action at this time regarding the above violations.

Reporting Violations

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 21 amended it bylaws, but did not file a copy
with its LM report. Local 21 has now filed a copy of its constitution and bylaws.

I want to extend my personal appreciation to ILWU LU 21 Kalama Export Division 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,

Investigator