U.S. Department of Labor
Office of Labor-Management Standards
Nashville District Office
233 Cumberland Bend Drive, Suite 110
Nashville, TN 37228
(615) 736-5906 Fax: (615) 736-7148
June 16, 2011

Mr. Marshall Koger, President
Steelworkers AFL-CIO
Local 09-481-G
134 Roberts Street
Florence, AL 35633

Case Number:
LM Number: 067-989

Dear Mr. Koger:

This office has recently completed an audit of Steelworkers Local 09-481-G 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, Treasurer Andy Bryant, and Financial Secretary
Randy West on June 9, 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 09-481-G’s 2010 records revealed the following recordkeeping violations:


Mr. Marshall Koger
June 16, 2011
Page 2 of 3

1. Lost Wages
Local 09-481-G did not retain adequate documentation for lost wage reimbursement
payments to union officers totaling at least $5,057.32. The union must maintain records in
support of lost wage claims that identify each date lost wages were incurred, the number of
hours lost on each date, the applicable rate of pay, and a description of the union business
conducted. The OLMS audit found that Local 09-481-G’s vouchers did not reflect the lost
time dates and union business conducted.

During the exit interview, I provided a compliance tip sheet, Union Lost Time Payments
that contained a sample of an expense voucher. The lost wage voucher provided by your
international is sufficient because it identifies the type of information and documentation
that the local must maintain for lost wages and other officer expenses.

2. General Expenses
Local 481 did not retain adequate documentation for general expenses paid by your local
totaling at least $200. For example, the local disbursed $200 but did not identify the union
purpose.

As noted above, labor organizations must maintain 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. 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.

3. Receipt Dates not Recorded
Entries in Local 09-481-G’s cash books reflect the date the union deposited money, but not
the date money was received. Union receipts 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.

4. Lack of Salary Authorization

Mr. Marshall Koger
June 16, 2011
Page 3 of 3

Local 09-481-G did not maintain records to verify that the salaries reported in Item 24 (All
Officer and Disbursements to Officers) of the LM-3 was the authorized amount and
therefore was correctly reported. 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.

Based on your assurance that Local 09-481-G will retain adequate documentation in the future,
OLMS will take no further enforcement action at this time regarding the above violations.

Other Issue

Bank Deposits

The audit disclosed that a union officer remits your organization’s deposits to his spouse, who is
a bank employee, outside of banking hours, and the spouse makes the deposits on behalf of the
local. Article V, Section 5 (Duties of Treasurer) of the By-laws for Local Unions states, “The
Treasurer shall receive from the Financial Secretary all money collected by the Financial
Secretary and shall deposit all money belonging to the Local Union in a bank designated by it.”
In addition, the international’s bond coverage for local unions specifically covers only union
officials and personnel. Since the bank employee is not an employee or officer of your
organization, it is strongly recommended that Local 09-481-G discontinues this practice and
ensure that future deposits are made by the treasurer or other designated union official as
required in your organization’s bylaws.

I want to extend my personal appreciation to Steelworkers Local 09-481-G 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. Andy Bryant, Treasurer