U.S. Department of Labor
Office of Labor-Management Standards
San Francisco-Seattle District Office
300 5th Avenue, Suite 1290
Seattle, WA 98104-3308
(206) 398-8099 Fax: (206) 398-8090
June 9, 2016
Ms. Stacy DeGreek-Potts, Secretary-Treasurer
CWA Local 9333
1125 Kansas Ave
Modesto, CA 95351
Case Number: 530-6007419
LM Number: 543520
Dear Ms. DeGreek-Potts:
This office has recently completed an audit of CWA Local 9333 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 Elaine Savaiki, and Former President on June 8, 2016, 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 9333’s 2015 records revealed the following recordkeeping violations:
1. Lost Wages
In every instance, Local 9333 did not retain adequate documentation for lost wage reimbursement payments to union officers. 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.
2. Asset Inventory
Local 9333 did not maintain an inventory of computers, furniture and other equipment of value. The union must report the value of any union property on hand at the beginning and end of each year in Item 29 of the LM-3. The union must retain an inventory or similar record of property on hand to verify, clarify, and explain the information that must be reported in Item 29.
3. Lack of Salary Authorization
Local 9333 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 9333 will retain adequate documentation in the future, OLMS will take no further enforcement action at this time regarding the above violations.
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 (Form LM-2 / LM-3) filed by Local 9333 for the fiscal year ended September 30, 2015, was deficient in that Local 9333 failed to file its 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. Local9333 amended its constitution and bylaws in 2011, but did not file a copy with its LM report for that year.
I want to extend my personal appreciation to CWA Local 9333 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: Ms. Elaine Savaiki, President