U.S. Department of Labor
Office of Labor-Management Standards
Buffalo District Office
130 South Elmwood Avenue, Suite 510
Buffalo, NY 14202
(716) 842-2900 Fax: (716) 842-2901
May 18, 2011
Mr. Richard Palladino, Business Manager
Laborers Local Union 91
2556 Seneca Avenue
Niagara Falls, NY 14305
Case Number:
LM Number: 004153
Dear Mr. Palladino:
This office has recently completed an audit of Laborers Local Union 91 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 President Michael Palladino, Office Staff Nancy Sims, and you on May 13,
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 91’s 2010 records revealed the following recordkeeping violations:
1. Meal Expenses
Mr. Richard Palladino
May 18, 2011
Page 2 of 3
Local 91 did not require officers and employees to submit itemized receipts for meal
expenses totaling at least $497. The union must maintain itemized receipts provided by
restaurants to officers and employees. These itemized receipts are necessary to determine
if such disbursements are for union business purposes and to sufficiently fulfill the
recordkeeping requirement of LMRDA Section 206.
Union records of meal expenses should include written explanations of the union business
conducted and the full names and titles of all persons who incurred the restaurant charges.
Also, the records retained must identify the names of the restaurants where the officers or
employees incurred meal expenses.
2. Union Owned Vehicles
The union did not maintain records necessary to verify the accuracy of the information
reported in Schedule 11 (All Officers and Disbursements to Officers) of the LM-2.
Local 91 incurred expenses totaling at least $8,737 for automobiles during fiscal year 2010.
However, Local 91 did not maintain sufficient records documenting business versus
personal use of the union vehicles.
The LM-2 instructions include specific rules for the reporting of automobile expenses. The
union must report operating and maintenance costs for each of its owned or leased vehicles
in Schedules 11 and 12 of the LM-2, allocated to the officer or employee to whom each
vehicle is assigned.
For trips taken using a union owned vehicle, officers and employees must maintain mileage
logs that show the date, number of miles driven, whether the trip was business or personal,
and, if business, the purpose of the trip.
Based on your assurance that Local 91 will retain adequate documentation in the future, OLMS
will take no further enforcement action at this time regarding the above violations.
Other Issue
Inventory of Fixed Assets
As discussed with you during course of the compliance audit and during the exit interview, it is
recommended that the union maintain an inventory list of its fixed assets. An inventory list will
help you identify, account for, and determine the total value of your union’s fixed assets.
Mr. Richard Palladino
May 18, 2011
Page 3 of 3
I want to extend my personal appreciation to Laborers Local Union 91 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
cc:
Mr. Michael Palladino, President
Mr. Matthew Schiavi, Treasurer