Proposed Rule2022-19229
Revision of the Form LM-10 Employer Report
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 13, 2022
Issuing agencies
Labor DepartmentLabor-Management Standards Office
Abstract
The Office of Labor-Management Standards of the Department of Labor (Department) is proposing revisions to the Form LM-10 Employer Report, required under section 203 of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). Employers must file a Form LM-10 Employer Report with the Department to disclose certain payments, expenditures, agreements, and arrangements. The Department proposes to add to the Form LM-10 report a checkbox requiring certain reporting entities to indicate whether such entities were Federal contractors or subcontractors in their prior fiscal year, and two lines for entry of filers' Unique Entity Identifier and Federal contracting agency(ies), if applicable.
Full Text
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<title>Federal Register, Volume 87 Issue 176 (Tuesday, September 13, 2022)</title>
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[Federal Register Volume 87, Number 176 (Tuesday, September 13, 2022)]
[Proposed Rules]
[Pages 55952-55974]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-19229]
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DEPARTMENT OF LABOR
Office of Labor-Management Standards
29 CFR Part 405
RIN 1245-AA13
Revision of the Form LM-10 Employer Report
AGENCY: Office of Labor-Management Standards, Department of Labor.
ACTION: Proposed form revision; request for comments.
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SUMMARY: The Office of Labor-Management Standards of the Department of
Labor (Department) is proposing revisions to the Form LM-10 Employer
Report, required under section 203 of the Labor-Management Reporting
and Disclosure Act of 1959 (LMRDA). Employers must file a Form LM-10
Employer Report with the Department to disclose certain payments,
expenditures, agreements, and arrangements. The Department proposes to
add to the Form LM-10 report a checkbox requiring certain reporting
entities to indicate whether such entities were Federal contractors or
subcontractors in their prior fiscal year, and two lines for entry of
filers' Unique Entity Identifier and Federal contracting agency(ies),
if applicable.
DATES: Comments must be received on or before October 13, 2022.
ADDRESSES: You may submit comments, identified by RIN 1245-AA13 only by
the following method: internet--Federal eRulemaking Portal. Electronic
comments may be submitted through <a href="https://www.regulations.gov">https://www.regulations.gov</a>. To
locate the proposed form revision, use RIN 1245-AA13 or key words such
as ``LM-10,'' ``Labor-Management Standards'' or ``Employer Reports'' to
search documents accepting comments. Follow the instructions for
submitting comments. Please be advised that comments received will be
posted without change to <a href="https://www.regulations.gov">https://www.regulations.gov</a>, including any
personal information provided.
FOR FURTHER INFORMATION CONTACT: Karen Torre, Chief of the Division of
Interpretations and Regulations, Office of Labor-Management Standards,
U.S. Department of Labor, 200 Constitution Avenue NW, Room N-5609,
Washington, DC 20210, (202) 693-0123 (this is not a toll-free number),
(800) 877-8339 (TTY/TDD), <a href="/cdn-cgi/l/email-protection#e7a8abaab4cab792858b8e84a783888bc9808891"><span class="__cf_email__" data-cfemail="cf8083829ce29fbaada3a6ac8faba0a3e1a8a0b9">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Statutory Authority
The legal authority for this proposed form revision is set forth in
sections 203 and 208 of the Labor-Management Reporting and Disclosure
Act of 1959, as amended (LMRDA), 29 U.S.C. 433, 438. Section 208 of the
LMRDA provides that the Secretary of Labor shall have authority to
issue, amend, and rescind rules and regulations prescribing the form
and publication of reports required to be filed under Title II of the
Act and such other reasonable rules and regulations as the Secretary
may find necessary to prevent the circumvention or evasion of the
reporting requirements. 29 U.S.C. 438. The Secretary has delegated this
authority under the LMRDA to the Director of the Office of Labor-
Management Standards (OLMS) and permits re-delegation of such
authority. See Secretary's Order 03-2012--Delegation of Authorities and
Assignment of Responsibilities to the Director, Office of Labor-
Management Standards, 77 FR 69375 November 16, 2012.
II. Statutory and Regulatory Background
A. History of the LMRDA's Reporting Requirements
The Secretary of Labor administers and enforces the Labor-
Management Reporting and Disclosure Act of 1959, as amended (LMRDA),
Public Law 86-257, 73 Stat. 519-546, codified at 29 U.S.C. 401-531. The
LMRDA, in part, establishes labor-management transparency through
reporting and disclosure requirements for labor organizations and their
officials, employers and their labor relations consultants, and surety
companies.
In enacting the LMRDA in 1959, a bipartisan Congress expressed the
conclusion, as it relates to this proposed form revision, that in the
labor and management fields there had been a number of examples of
breach of trust, corruption, and disregard of employee rights. Congress
determined that legislation was needed to protect the rights of
employees and the public as they relate to employers, labor relations
consultants, and others. See 29 U.S.C. 401(b).
The LMRDA is the direct outgrowth of an investigation conducted by
the Senate Select Committee on Improper Activities in the Labor or
Management Field, commonly known as the McClellan Committee, which
convened in 1958. Enacted in 1959 in response to the report of the
McClellan Committee, the LMRDA addresses various ills identified by the
Committee through a set of integrated provisions aimed, among other
things, at shedding light on labor-management relations, governance,
and management. These provisions include financial reporting and
disclosure requirements for employers and labor relations consultants.
See 29 U.S.C. 431-36, 441.
Among the abuses that prompted Congress to enact the LMRDA was
questionable conduct by some employers and their labor relations
consultants that interfered with the right of employees to organize
labor unions and to bargain collectively under the National Labor
Relations Act (NLRA), 29 U.S.C. 151 et. seq. See, e.g., S. Rep. NO. 86-
187 (``S. Rep. 187'') at 6, 10-12 (1959), reprinted in 1 NLRB,
Legislative History of the Labor-Management Reporting and Disclosure
Act of 1959 (``LMRDA Leg. Hist.''), at 397, 402, 406-408. Congress was
concerned that labor consultants, acting on behalf of management,
worked directly or indirectly to discourage legitimate employee
organizing drives and engage in ``union-busting'' activities. S. Rep.
187 at 10, LMRDA Leg. Hist. at 406.
[[Page 55953]]
Congress concluded that such consultant activities ``should be exposed
to public view,'' id., S. Rep. at 11, because they are ``disruptive of
harmonious labor relations and fall into a gray area,'' id. at 12, even
if the consultant's conduct was not unlawful or did not otherwise
constitute an unfair labor practice under the NLRA.
As a result, Congress imposed reporting requirements on employers
and their consultants under LMRDA section 203. 29 U.S.C. 433. Under
LMRDA section 208, the Secretary of Labor is authorized to issue,
amend, and rescind rules and regulations prescribing the form and
publication of required reports, as well as ``such other reasonable
rules and regulations . . . as he may find necessary to prevent the
circumvention or evasion of such reporting requirements.'' 29 U.S.C.
438. The Secretary is also authorized to bring civil actions to enforce
the LMRDA's reporting requirements. 29 U.S.C. 440. Willful violations
of the reporting requirements, knowing false statements made in a
report, and knowing failures to disclose a material fact in a report
are subject to criminal penalties. 29 U.S.C. 439.
B. Statutory and Regulatory Requirements for Employer Reporting
Section 203(a) of the LMRDA, 29 U.S.C. 433(a), requires employers
to file a report, subject to certain exemptions, covering the following
payments and arrangements made in a fiscal year: certain payments to,
or other financial arrangements with, a labor organization or its
officers, agents, or employees; payments to employees for the purpose
of causing them to persuade other employees with respect to their
bargaining and representation rights; payments for the purpose of
interfering with employees in the exercise of their bargaining and
representation rights or for obtaining information on employee or labor
organization activities in connection with labor disputes involving
their company; and arrangements (including related payments) with a
labor relations consultant for the purpose of persuading employees with
respect to their bargaining and representation rights, or for obtaining
information concerning employee activities in connection with a labor
dispute involving their company. 29 U.S.C. 433.
If an employer has engaged in reportable activity, the employer
must file a report, signed by its president and treasurer showing in
detail the date and amount of each payment, loan, promise, agreement,
or arrangement and the name, address, and position, if any, in any firm
or labor organization of the person to whom it was made and a full
explanation of the circumstances of all such payments, including the
terms of any agreement or understanding pursuant to which they were
made. See 29 U.S.C. 433. The Department of Labor's implementing
regulations require employers to file a Form LM-10 Employer Report
(``Form LM-10'') that contains this information. See 29 CFR part 405.
C. Overview and History of the Form LM-10
The Form LM-10 Employer Report must be filed by any employer who
has engaged in certain financial transactions or arrangements, of the
type described in LMRDA section 203(a), with any labor organization,
union official, employee, or labor relations consultant, or who has
made expenditures for certain objects relating to activities of
employees or a union. Employers are required to file only one Form LM-
10 each fiscal year that covers all instances of reportable activity
even if activity occurs at multiple locations.
In its current iteration, the Form LM-10 is divided into two parts:
Part A and Part B. Part A consists of pages 1 and 2 of the Form LM-10.
In Part A, Items 1-7 request basic identifying information about the
employer, namely file number, fiscal year, address of the employer,
address of the president or corresponding officer, any other address
where records needed to verify the report can be made available for
examination, a checklist of each location where records needed to
verify the report can be made available for examination, and what type
of legal entity is filing the report (``Corporation, Partnership,
Individual, Other (specify)''). Item 13 and Item 14 are also featured
on page 1 of Part A and are the signature boxes for the president and
treasurer of the employer, respectively. Page 2 consists entirely of
Part A, Item 8, which contains six ``Yes or No'' questions pertaining
to reportable employer activities. If the employer-filer can answer
``No'' to every question in Item 8, then no LM-10 Report needs to be
filed. With each question answered ``Yes,'' the filer must complete a
separate Part B for every person or organization with whom a reportable
agreement was made or to whom a reportable payment was made as to that
``Yes'' answer. The form also asks for the total number of Part Bs
filed for each question in Item 8.
Part B comprises page 3, and requires the name of the reporting
employer and the file number again to ensure it is matched with Part A.
Similarly, the next field is a checkbox indicating the questions in
Item 8 (labeled a through f) to which this Part B applies. Items 9-12
require various details regarding the agreement or payments the
employer-filer made.
Item 9 consists of four parts, 9.a.-9.d. Item 9.a. asks whether
this Part B concerns itself with an ``Agreement,'' a ``Payment,'' or
``Both.'' Item 9.b. requires the name and address of the person with
whom or through whom a separate agreement was made or to whom payments
were made. Item 9.c. requires the position of any persons mentioned in
9.b. Item 9.d. requires the name and address of the labor organization
or firm any person mentioned in 9.b. is a part of.
Item 10 consists of two parts, 10.a. and 10.b. Item 10.a. requires
the date of the promise, agreement, or arrangement pursuant to which
payments or expenditures were agreed to or made. Item 10.b. consists of
three checkboxes and filers are required to mark whether the promise,
agreement, or arrangement was ``Oral,'' ``Written,'' or ``Both.'' If
the agreement is written and entered into during the fiscal year, it
must be attached to the report.
Item 11 consists of three parts, 11.a.-11.c. Item 11.a. requires
the date of each payment or expenditure referred to in Item 9. Item
11.b. requires the amount of each of those payments. Item 11.c.
requires the filer to indicate the kind of each payment or expenditure,
specifying whether it was a payment or a loan and whether it was made
in cash or property.
Item 12 requires a narrative response from the filers with a full
explanation identifying the purpose and circumstances of the payments,
promises, agreements, or arrangements included in the report. The
explanation must contain a detailed account of services rendered or
promised in exchange for promises or payments the filer has either
already made or agreed to make. The explanation must also fully outline
the conditions and terms of any oral agreement or understanding
pursuant to which they were made. Lastly, the filer must indicate
whether the payments or promises reported specifically benefited the
person or persons listed in Item 9.b., or the firm, group, or labor
organization named in Item 9.d. If the employer-filer made payments,
promises, or agreements through a person or persons not shown above,
they must provide the full name and address of such person or persons.
The explanation must clearly indicate why the filer must report the
payment, promise, or agreement. Any incomplete
[[Page 55954]]
responses or unclear explanations render a report deficient.
III. Proposed Revisions to the Form LM-10
In this document, the Department proposes a revision to the Form
LM-10 Employer Report to supplement the identifying information that
OLMS already collects from employers required to file, such as the
employer's name, address, and status as a corporation, partnership, or
individual. The proposed revision would not change which employers are
required to file Form LM-10; it would require filers to provide an
additional item of identifying information--whether the employer is a
Federal contractor or subcontractor--and, if so, a short entry
indicating the Federal contracting agency(ies) and the contractor's
Unique Entity Identifier (UEI), if the contractor has one. If providing
the name of a contracting agency would reveal classified information,
the filer should omit the name of the agency. All Federal prime
contractors, and, in some cases, subcontractors performing on Federal
prime contracts, must have a UEI in order to do business with the
Federal Government or to meet reporting requirements per the Federal
Acquisition Regulation (FAR). For example, FAR regulations at 48 CFR
52.204-6 requires prime contractors to obtain a UEI in order to
register to obtain contracts with the Federal Government (as of April
2022, the Unique Entity Identifier replaced the Data Universal
Numbering System (DUNS) number).\1\
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\1\ ``As of April 4, 2022, the federal government stopped using
the DUNS Number to uniquely identify entities. Now, entities doing
business with the federal government use the Unique Entity ID
created in <a href="http://SAM.gov">SAM.gov</a>. They no longer go to a third-party website to
obtain their identifier. This transition allows the government to
streamline the entity identification and validation process, making
it easier and less burdensome for entities to do business with the
federal government.'' Unique Entity Identifier Update, U.S. General
Services Administration, available at <a href="https://www.gsa.gov/about-us/organization/federal-acquisition-service/office-of-systems-management/integrated-award-environment-iae/iae-systems-information-kit/unique-entity-identifier-update">https://www.gsa.gov/about-us/organization/federal-acquisition-service/office-of-systems-management/integrated-award-environment-iae/iae-systems-information-kit/unique-entity-identifier-update</a> (last visited May 4, 2022).
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In order to collect this information quickly and efficiently, the
Department proposes adding one ``Yes,'' ``No,'' or ``N/A'' checkbox at
the end of the form regarding Federal contractor status. Not all filers
will be required to complete Item 12.b. Filers who answer ``Yes'' to
Item 8.a., but ``No'' to Items 8.b.-8.f., would not be required to
complete Item 12.b., and the electronic form would automatically check
the ``N/A'' box and grey out the remaining portions of Item 12.b. for
those filers so that no entry can be made.\2\ Additionally, the
Department proposes to add two lines where filers who are Federal
contractors would enter their Unique Entity Identifier and the Federal
contracting agency(ies) involved.
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\2\ See <a href="https://www.dol.gov/agencies/olms/reports/electronic-filing">https://www.dol.gov/agencies/olms/reports/electronic-filing</a>.
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The instructions would also make explicit that filers would enter
information that the Form LM-10 already requires--the unit or division
of employees that is the subject of the report. See Item 12 (``Provide
a full explanation identifying the purpose and circumstances of the
payments, promises, agreements, or arrangements included in the report.
Your explanation must contain a detailed account of services rendered
or promised in exchange for promises or payments you have already made
or agreed to make.''). This necessarily includes identifying certain
payments, expenditures, agreements, and arrangements regarding
employees. Filers must therefore currently identify the employees that
are the subject of the report in Item 12. The Department proposes to
renumber Item 12 as Item 12.a., and to add Item 12.b. thereafter with
the ``Yes,'' ``No,'' or ``N/A'' checkbox and the two lines.
The new Item 12.a. would consist of a narrative section that
mirrors the existing Item 12. In both the existing Item 12 and the
revised Item 12.a., filers must explain fully the circumstances of all
payments, including the terms of any oral agreement or understanding
pursuant to which they were made. As the instructions indicate for Item
12 and would indicate for Item 12.a., filers must provide ``a full
explanation identifying the purpose and circumstances of the payments,
promises, agreements, or arrangements included in the report.'' The
instructions would also make explicit that a ``full explanation''
requires that filers must identify the subject group of employees
(e.g., the particular unit or division in which those employees work).
Filers who checked ``Yes'' for any item in Items 8.b.-8.f. would be
required to complete Item 12.b. regarding their status as a Federal
contractor or subcontractor. Regarding such status, the Department
proposes to adopt the following definitions from the regulations
implementing Executive Order 13496, Notification of Employee Rights
Under Federal Labor Laws: (a) ``contract,'' (b) ``contracting agency,''
(c) ``contractor,'' (d) ``government contract,'' (e) ``modification of
a contract,'' (f) ``prime contractor,'' (g) ``subcontract,'' and (h)
``subcontractor.'' 29 CFR 471.1. Therefore, filers would be required to
answer Item 12.b. in accordance with those eight definitions.\3\ Id.
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\3\ The Form LM-10 instructions would list the definitions
adopted from the implementing regulations of Executive Order 13496
(Notification of Employee Rights Under Federal Labor Laws) at 29 CFR
471.1 for Contract, Contracting agency, Contractor, Government
contract, Modification of a contract, Prime Contractor, Subcontract,
and Subcontractor. See 29 CFR 471.1.
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The Department expects that Federal contractors and subcontractors
are already familiar with these definitions because they are, with
minimal changes, the same definitions that already govern Federal
contractors and subcontractors under Executive Order 11246, Equal
Employment Opportunity, and its implementing regulations. See 41 CFR
60-1.3 (definitions regarding obligations of Federal contractors and
subcontractors). Federal contractors and subcontractors are also
currently required to comply with Executive Order 13496. Executive
Order 13496 applies to Federal contractors and subcontractors subject
to the National Labor Relations Act (NLRA). The Department expects that
most filers are subject to the NLRA, as the National Labor Relations
Board (NLRB) has conducted over 1,000 representation elections per year
over the past decade, while the National Mediation Board (NMB) has
handled significantly fewer, with less than 50 representation election
cases per year over the same period.\4\ Pursuant to Executive Order
13496, employers covered by the NLRA are already required to know
whether they are Federal contractors or subcontractors under the
definitions proposed here and, if they are, to post the notice required
by Executive Order 13496 ``in conspicuous places'' including ``areas in
which the contractor posts notices to employees about the employees'
terms and conditions of employment'' and ``where employees covered by
the National Labor Relations Act engage in activities relating to the
performance of the contract.'' 29 CFR 471.2(d).
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\4\ See: <a href="https://www.nlrb.gov/reports/nlrb-case-activity-reports/representation-cases/election/election-statistics">https://www.nlrb.gov/reports/nlrb-case-activity-reports/representation-cases/election/election-statistics</a> and
<a href="https://nmb.gov/NMB_Application/wp-content/uploads/2021/12/FY-2021-NMB-Performance-and-Accountability-Report-PAR.pdf">https://nmb.gov/NMB_Application/wp-content/uploads/2021/12/FY-2021-NMB-Performance-and-Accountability-Report-PAR.pdf</a>.
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The Department notes that employers covered by the Railway Labor
Act (RLA) are not covered by Executive Order 13496, however, both NLRA
and RLA employers are subject to the reporting requirements of the
LMRDA. Thus, RLA employers may need more time to identify which
employees who are the
[[Page 55955]]
subject of the LM-10 report have duties relating to the performance of
the Federal contract or subcontract. As explained above, the Department
expects that only a small number of filers will be Federal contractors
or subcontractors subject to the RLA. Therefore, the Department expects
that all filers who are Federal contractors and subcontractors will
already know their status as such under Executive Order 11246 and its
implementing regulations, see 41 CFR 60-1.3, and that most filers will
be able to easily identify the information required for Item 12.b.
For those required to complete Item 12.b., it would consist of two
parts. First, filers would be required to complete the ``Yes,'' ``No,''
or ``N/A'' checkbox in response to the following question: ``If your
Part B applies to Items 8.b.-8.f., did the expenditures, payments,
arrangements or agreements concern employees performing work pursuant
to a Federal contract or subcontract?'' Second, if the filer answers
``Yes,'' they would be required to enter, on the two lines provided,
their Unique Entity Identifier and the Federal contracting agency(ies)
involved. If a subcontractor does not have a Unique Entity Identifier,
then the subcontractor should so state in Item 12.b If providing the
name of a contracting agency would reveal classified information, the
filer should omit the name of the agency. When filers answer ``Yes,''
in the checkbox portion of Item 12.b., failure to complete the entry on
the two lines provided, or an unclear explanation in that entry, would
render the report deficient.
IV. Purpose and Justification for Proposed Changes
Both the public and the employees whose rights are at issue have an
interest in understanding the full scope of activities undertaken by
employers to surveil employees, to commit unfair labor practices, or to
persuade employees not to exercise their rights to organize or bargain
collectively. See S. Rep. 187 at 10-11, LMRDA Leg. Hist. at 406-07.
The Form LM-10 reporting requirement is based on Congress's
dissatisfaction with the ``large sums of money [that] are spent in
organized campaigns on behalf of some employers'' on persuader
activities that ``may or may not be technically permissible'' and
Congress's determination that the appropriate response to such
persuader campaigns is to disclose them in the public interest and for
the preservation of ``the rights of employees.'' See S. Rep. 187 at 10-
12, LMRDA Leg. Hist. at 406-07.
As set forth in Section I, Statutory Authority, above, LMRDA
Section 208 authorizes the Secretary to ``issue . . . regulations
prescribing the form and publication of reports required to be filed
under this title.'' 29 U.S.C. 438. The statutory provision authorizing
the issuance of the Form LM-10 describes the data and information to be
reported in the Secretary's form. 29 U.S.C. 433.
The statutory intent to require employers to provide a ``full
explanation'' of payments was reflected in the Form LM-10 the Secretary
established. Employers are told: ``Explain fully the circumstances of
all payments, including the terms of any oral agreement or
understanding pursuant to which they were made.''
The proposal here clarifies that one of the circumstances that must
be explained is whether the payments concerned employees performing
work pursuant to a Federal contract or subcontract and, if so, the
filer would provide its Unique Entity Identifier, if it has one, and
the relevant Federal contracting agency(ies). If providing the name of
a contracting agency would reveal classified information, the filer
should omit the name of the agency. Disclosing contractor status is
consistent with Congress's intent in enacting the LMRDA: ``[I]t
continues to be the responsibility of the Federal Government to protect
employees' rights to organize, choose their own representatives,
bargain collectively, and otherwise engage in concerted activities for
their mutual aid or protection.'' 29 U.S.C. 401(a).
The Department proposes this change in response to the increased
prevalence of, and public interest in, persuader activities in recent
years. The media, academics, and non-governmental organizations (NGOs)
have taken note of persuader activity in a number of industries,
including multiple high-profile instances of companies investing
substantial resources in persuader activity. Over the decades, employer
efforts to defeat unions have become more prevalent, with more
employers turning to union avoidance consultants.\5\ Further, members
of Congress have noted recently that Federal contractors have engaged
in such agreements and activities.\6\ As the Agency responsible for
promoting transparency around management attempts to influence
employees' collective bargaining rights, OLMS closely monitors
developments in the ways management interacts with union organizing
efforts. The noted prevalence of persuader activity accordingly
increases the interest of Government in obtaining information on
persuader efforts which Congress found to be ``disruptive of harmonious
labor relations'' even if lawful. S. Rep. 187 at 12, LMRDA Leg. Hist.
at 406. This Government interest is especially acute when the Federal
Government itself is paying for goods and services from those who would
disrupt the harmonious labor relations that the Federal government is
bound to protect. See 29 U.S.C. 401(a).
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\5\ Celine McNicholas, et al., Unlawful: U.S. Employers Charged
with Violating Federal Labor Law in 41.5% of all Union Elections,
Economic Policy Institute, (Dec. 11, 2019) available at <a href="https://www.epi.org/publication/unlawful-employer-opposition-to-union-election-campaigns/">https://www.epi.org/publication/unlawful-employer-opposition-to-union-election-campaigns/</a> (``The data show that U.S. employers are willing
to use a wide range of legal and illegal tactics to frustrate the
rights of workers to form unions and collectively bargain. . . .
[E]mployers spend roughly $340 million annually on `union avoidance'
consultants to help stave off union elections. . . . Over the past
few decades, employers' attempts to thwart organizing have become
more prevalent, with more employers turning to the scorched-earth
tactics of `union avoidance' consultants.''); Heidi Shierholz et
al., Latest Data Release on Unionization, Economic Policy Institute,
(Jan. 20, 2022) available at <a href="https://www.epi.org/publication/latest-data-release-on-unionization-is-a-wake-up-call-to-lawmakers/">https://www.epi.org/publication/latest-data-release-on-unionization-is-a-wake-up-call-to-lawmakers/</a>
(describing how ``it is now standard, when workers seek to organize,
for employers to hire union avoidance consultants''); John Logan,
The New Union Avoidance Internationalism, 13 Work Org., Lab. &
Globalisation 2 (2019) available at <a href="https://www.scienceopen.com/hosted-document?doi=10.13169/workorgalaboglob.13.2.0057">https://www.scienceopen.com/hosted-document?doi=10.13169/workorgalaboglob.13.2.0057</a>.
\6\ Should Taxpayer Dollars Go to Companies that Violate Labor
Laws?, Comm. on the Budget, 117th Congress (May 5, 2022), available
at <a href="https://www.budget.senate.gov/hearings/should-taxpayer-dollars-go-to-companies-that-violate-labor-laws">https://www.budget.senate.gov/hearings/should-taxpayer-dollars-go-to-companies-that-violate-labor-laws</a> (discussing the propriety of
government contracting with Federal contractors that engage in legal
and illegal tactics, including ``union busters,'' to dissuade
workers from exercising their organizing and collective bargaining
rights).
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In other words, greater transparency is even more important when
persuader activities are undertaken by employers that receive Federal
funds through contracting relationships. See Executive Order (E.O.)
13494 (reiterating ``the policy of the United States to remain
impartial concerning any labor-management dispute involving Government
contractors.''). Such Federal contractors are not permitted to receive
reimbursement for the costs of engaging in those activities under the
contract. E.O. 13494, 74 FR 6101; 48 CFR 31.205-21.\7\ But these
Federal
[[Page 55956]]
contractors still engage in those activities; they simply do not seek
or obtain reimbursement from the government for the costs of the
activities.
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\7\ Section 2 of E.O. 13494 provides that the policy of the
Executive branch in procuring goods and services is to to ensure the
economical and efficient administration of Government contracts,
contracting departments and agencies, when they enter into, receive
proposals for, or make disbursements pursuant to a contract as to
which certain costs are treated as unallowable, shall treat as
unallowable the costs of any activities undertaken to persuade
employees--whether employees of the recipient of the Federal
disbursements or of any other entity--to exercise or not to
exercise, or concerning the manner of exercising, the right to
organize and bargain collectively through representatives of the
employees' own choosing. And that such unallowable costs shall be
excluded from any billing, claim, proposal, or disbursement
applicable to any such Federal Government contract. 74 FR 6101. The
E.O. further directs the Federal Acquisition Regulatory Council (FAR
Council) to adopt rules to implement the order, and each contracting
department or agency to cooperate with the FAR Council and provide
whatever information or help it may need to perform its functions
under the E.O. Id. at 6101-02. Subsequently, the General Services
Administration, Department of Defense, and the National Aeronautics
and Space Administration issued a final rule amending the FAR to
implement E.O. 13494. 76 FR 68040 (Nov. 2, 2011). The new provision,
at 48 CFR 31.205-21, distinguishes the costs related to ``persuader
activities'' made unallowable under the E.O. from the costs
``incurred in maintaining satisfactory relations between the
contractor and its employees'' that remain allowable.
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The proposed revision to Form LM-10 would increase transparency
regarding which Federal contractors and subcontractors are engaging in
persuader activities. Confirming a filer's status as a Federal
contractor, as well as its Unique Entity Identifier, as part of a full
explanation of persuader activities will provide a method for the
public, procurement agencies and employees to quickly identify which
persuaders are Federal contractors.
This increased transparency benefits the employees subject to the
employer's persuader activity by giving them relevant information about
the source of communications that seek to influence their rights--as
intended by Congress in enacting the LMRDA. Generally, the transparency
created by the persuader reporting requirements is designed to better
inform workers in making determinations regarding the exercise of their
rights to organize and bargain collectively. For example, with the
knowledge that the source of the information received is an anti-union
campaign managed by an outsider, workers will be better able to assess
the merits of the arguments directed at them and make an informed
choice about how to exercise their rights. Here, employees have a
particular interest in knowing whether their employers are Federal
contractors because, as taxpayers themselves, those employees should
know whether they are indirectly financing persuasion campaigns
regarding their own rights to organize and bargain collectively.
Persuader campaigns are not themselves reimbursable under the Federal
contract or subcontract. Nevertheless Federal contractors receive
Federal dollars--often in significant amounts--for goods and services.
Such funds support directly or indirectly contractors' businesses and
additional activities, which may include the decision to hire the
outsider to persuade the employees.
Additionally, by learning of the previously unknown Federal
contractor status their employer enjoys, those employees would have the
information that would allow them to meaningfully exercise their right
to choose whether to contact their representatives in Congress to
inquire about the amount of Federal appropriations underlying the
contracts with their employers, or the contractors' activities
undertaken directly or indirectly pursuant to such contracts, or allow
the employees to work more effectively with advocacy groups or the
media to disseminate their views as employees to a wider audience. This
is consistent with Congress' expectations when enacting the LMRDA--that
in the public interest, and consistent with First Amendment rights to
speak out on these issues, citizens would have the benefit of public
reports regarding employer conduct that falls in a ``gray area.'' S.
Rep. 187 at 11, LMRDA Leg. Hist. at 407 (persuader activities ``should
be exposed to public view, for if the public has an interest in
preserving the rights of employees then it has a concomitant obligation
to insure the free exercise'' of those rights).
The requirement that an employer provide its Unique Entity
Identifier, if it has one, will prevent confusion. Two or more
employers may have a similar name. Individual employers often use
multiple names, including trade, business, assumed or fictitious names,
such as a DBA (``doing business as'') designation. All Federal
contractors have their own individual identifier to seek and secure
Federal contracts.\8\ By requiring employers to provide this
identifier, members of the public and employees will be able to confirm
the true identity of the employer. As stated, if a subcontractor does
not have a Unique Entity Identifier, then it should so state in Item
12.b. If providing the name of a contracting agency would reveal
classified information, the filer should omit the name of the agency.
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\8\ See: <a href="https://www.acquisition.gov/far/part-4#FAR_Subpart_4_11">https://www.acquisition.gov/far/part-4#FAR_Subpart_4_11</a>.
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Given the potential for disruption, the public, like employees, has
an interest in knowing whether the government is indirectly funding
persuader activity by engaging in business with these companies, even
if these activities are not unlawful. The required disclosure of such
information is consistent with and fully authorized by sections 203 and
208 of the LMRDA and their broad grant of authority to prescribe the
form of the required reports. 29 U.S.C. 433, 438.
Knowledge of such information would also enable members of the
public to understand which Federal agencies are contracting with
employers who are engaging in persuader activity. The public and
employees would benefit from knowing whether a specific Federal agency
is choosing to do business with an employer that is attempting to
influence the exercise of workers' rights to choose whether to organize
and bargain collectively. This public exposure would allow for an open
public discussion and debate about the prevalence of persuader activity
and the extent to which specific Federal agencies might be indirectly
supporting such activities by doing business with employers that engage
in persuader activities.
V. Regulatory Procedures
A. Executive Order 12866 (Regulatory Planning and Review) and 13563
(Improving Regulation and Review)
Under Executive Order (E.O.) 12866, the Office of Management and
Budget (OMB)'s Office of Information and Regulatory Affairs determines
whether a regulatory action is significant and, therefore, subject to
the requirements of the E.O. and review by OMB. 58 FR 51735. Section
3(f) of E.O. 12866 defines a ``significant regulatory action'' as an
action that is likely to result in a rule that (1) has an annual effect
on the economy of $100 million or more, or adversely affects in a
material way a sector of the economy, productivity, competition, jobs,
the environment, public health or safety, or State, local or tribal
governments or communities (also referred to as economically
significant); (2) creates serious inconsistency or otherwise interferes
with an action taken or planned by another agency; (3) materially
alters the budgetary impacts of entitlement grants, user fees, or loan
programs, or the rights and obligations of recipients thereof; or (4)
raises novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the E.O. Id. OMB
has determined that this proposed form revision is a significant
regulatory action under section 3(f)(4) of E.O. 12866.
E.O. 13563 directs agencies to propose or adopt a regulation only
upon a reasoned determination that its benefits justify its costs; the
regulation is tailored to impose the least burden on society,
consistent with achieving the regulatory
[[Page 55957]]
objectives; and in choosing among alternative regulatory approaches,
the agency has selected those approaches that maximize net benefits.
E.O. 13563 recognizes that some benefits are difficult to quantify and
provides that, where appropriate and permitted by law, agencies may
consider and discuss qualitative values that are difficult or
impossible to quantify, including equity, human dignity, fairness, and
distributive impacts.
A. Costs of the Updated Form LM-10 for Affected Employers
The Form LM-10 is filed by private business entities that engage in
certain financial transactions or arrangements, and these employer
entities only have reporting obligations during fiscal years in which
the entity makes such transactions or enters in such arrangements. As
such, the Form LM-10 is not an annually mandatory form, so not all
employers must file the Form LM-10 in a given year. Further, as has
been discussed, the modification to the Form LM-10 discussed in this
NPRM does not add a new form or remove any forms, nor does it expand or
contract the circumstances under which it is necessary for an employer
to file an LM-10. This modification only slightly changes the structure
of Item 12 by adding two items for certain filers. However, the
Department will account for the potentially minimal costs of the slight
changes to the structure of Item 12.
Based upon estimates for the existing Form LM-10 and other LM
forms, the Department estimates that the new Item 12.b. will take a
minimum of approximately 5 minutes to complete, thus adding
approximately 5 minutes of reporting burden to the existing Form LM-10
(which the current existing instructions estimate to take approximately
35 minutes to complete, including the current Item 12). This 5 minutes
is an average that takes into account that not all filers will be
Federal contractors or subcontractors and not all Federal contractors
or subcontractors that file will be required to complete the two lines
in Item 12.b. While the Department does not expect that employers
required to complete Item 12.b. will have difficulty in determining
which employees work on which Federal contract, the Department also
acknowledges uncertainty in this area. Thus, the Department also seeks
comment on whether it should raise the burden increase estimate from 5
minutes to 15 minutes or some other number.
The Department does not estimate any additional recordkeeping
burden for the following reasons. Some filers will spend zero minutes
on Item 12.b. because, after only checking ``Yes'' to Item 8.a., the
form will automatically check ``N/A'' and grey out the rest of Item
12.b. as no answer will be required. Many filers will need less than
the 5-15 minutes to address Item 12.b. because they will only need to
check ``No,'' that they are not a Federal contractor or subcontractor.
The large majority of Federal contractors and subcontractors will
need no more than 5-15 minutes to complete Item 12.b. Checking ``Yes''
regarding their status as a Federal contractor or subcontractor will
only take a few minutes because all Federal contractors and
subcontractors are already required to be familiar with the definitions
proposed here regarding that status, which are based on Executive
Orders 11246 and 13496 and their implementing regulations. See 41 CFR
60-1.3 (definitions regarding obligations of Federal contractors and
subcontractors); 29 CFR part 471 and note 3, supra (including eight
definitions OLMS proposes to adopt).
Similarly, most Federal contractors and subcontractors should be
able to easily enter their Unique Entity Identifier. See note 1, supra.
If a filer does not have a Unique Entity Identifier, the filer should
so state in Item 12.b. Along with their Unique Entity Identifier,
Federal contractors and subcontractors would enter the name of the
Federal contracting agency(ies) on the two lines in Item 12.b. If
providing the name of a contracting agency would reveal classified
information, the filer should omit the name of the agency.
While some RLA-covered employers may need more than 5-15 minutes
because they may not be immediately familiar with which employees who
are the subject of the Form LM-10 report have duties relating to the
performance of the Federal contract or subcontract (and thus which
agencies to enter into Item 12.b.), the Department does not expect RLA-
covered filers to be as numerous as NLRA-covered filers, although the
Department is aware that there are RLA-covered Federal contractors and
subcontractors. The Department presumes that the large majority of
employers that constitute Federal contractors or subcontractors would
need no more than 5-15 minutes for Item 12.b., because they will be
covered by the NLRA and therefore they will already be required to
retain information relevant to Item 12.b., including which units of
employees perform work under such contracts, pursuant to Executive
Order 13496 (Notification of Employee Rights Under Federal Labor Law).
While a few filers may have a slightly higher time burden, and some
will have a time burden that is lower than 5-15 minutes, the Department
has accounted for this in determining the average time burden of 5-15
minutes. The Department asks for comment on this point.
The Department estimates that the 5-15-minute estimate, just as the
existing 35-minute total estimate, represents an average of affected
filers. Indeed, not all Form LM-10 filers will need to complete the new
Item 12.b.\9\ More specifically, filers need not fill out Item 12.b if
they have only checked ``Yes'' to Item 8.a. Rather, only if a filer
answers ``Yes'' to any of Items 8.b.-8.f. would they need to answer
Item 12.b. Additionally, filers who check ``No'' on item 12.b. will not
have to enter any further information in Item 12.b., further decreasing
the average time burden. Further, because the Form LM-10 represents a
situationally occurring reporting requirement rather than an annual
reporting requirement, it would be imprudent to try to estimate
differing burden levels associated with first-year exposure and
subsequent exposures to the new questions.
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\9\ In fiscal year (FY) 21, based upon an electronic review of
reports submitted, OLMS received approximately 200 Form LM-10
reports covering persuader-related transactions and agreements,
among the 403 total Form LM-10 reports received during that year.
See: <a href="https://www.dol.gov/agencies/olms/data">https://www.dol.gov/agencies/olms/data</a>.
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To determine the cost increase per Form LM-10 filer associated with
the new Item 12, the Department utilized an approach consistent with
the information collection request (ICR) filed with the Office of
Management and Budget pursuant to the Paperwork Reduction Act (PRA). In
the existing ICR, the Department assumed that employers will hire a
lawyer to complete the form, and it derived the average hourly salary
for lawyers ($71.17) from the Occupational Employment and Wages Survey,
May 2021 survey (released in March 2022), Table 1, from the Bureau of
Labor Statistics (BLS), Occupational Employment Statistics (OES)
Program. See: <a href="https://www.bls.gov/oes/current/oes231011.htm">https://www.bls.gov/oes/current/oes231011.htm</a>. Further,
the Department determined the total compensation (salary plus fringe
benefits) by increasing the hourly wage rate by approximately 45.0%,
which is the percentage total of the average hourly benefits
compensation figure ($12.52 in December 2021) over the average hourly
wage figure ($27.83 in December 2021). See Employer Costs for Employee
[[Page 55958]]
Compensation Summary, September 2021 (released in December 2021), from
the BLS at <a href="http://www.bls.gov/news.release/ecec.nr0.htm">http://www.bls.gov/news.release/ecec.nr0.htm</a>. Thus, the
Department increased the totally hourly compensation for lawyers to
$103.20 ($71.17 x 1.450).
As such, the average individual employer filing the LM-10 as
modified under this proposal can expect to incur an increased cost per
year of, approximately, between $8.60 ($103.20 x 5/60 = $8.60) and
$25.80 ($103.20 x 15/60 + $25.80).
Although not all Form LM-10 filers will need to complete Item
12.b., the Department nevertheless estimates that each of the
approximately 647 annual Form LM-10 filers (based upon a 5-year average
of submitted reports) will incur the additional 5-15 minutes of annual
reporting burden. See: <a href="https://www.dol.gov/agencies/olms/data">https://www.dol.gov/agencies/olms/data</a>. As such,
the overall cost of this proposed modification for all entities filing
a Form LM-10 per year is between $5,564.20 ($8.60 x 647 reporting
entities = $5,564.20) and $16,692.60 ($25.80 x 647 reporting entities =
$16,692.60). The Department asks comment on this approach and where
within this range the estimate should fall.
B. Summary of Costs
In sum, this proposed amendment to the Form LM-10 has an
approximated 10-year cost of between $55,642.00 and $166,926.00 spread
across 647 separate yearly Form LM-10 filers. OLMS does not believe
that the cost of this proposed amendment to the Form LM-10 will cause a
significant burden on reporting entities.
C. Benefits
The proposed amendment to the Form LM-10 will benefit employers in
the filing of complete and accurate forms. By updating the form and
instructions to clearly and accurately describe the information
employers must disclose, the proposed form revision will facilitate
filers' understanding and compliance, thereby reducing incidents of
noncompliance and associated costs incurred when noncompliant.
The proposed amendment will also benefit filers' employees and the
public. As has been discussed in Section IV above, the Department
believes that its proposed amendment to the Form LM-10 will also bridge
important information gaps that have appeared in Form LM-10 reporting.
Primarily, the reporting requirements associated with the Form LM-10
already call for the reporting of an employer's contact and identifying
information, as well as a ``a detailed account of services rendered or
promised . . .,'' which the Department interprets as including the
particular division or unit of employees subject to the persuader-
related activity in question. The Department is acting because a
purpose of the LMRDA, which the Department administers, is to satisfy
``in the public interest, . . . the responsibility of the Federal
Government to protect employees' rights to organize, choose their own
representatives, bargain collectively, and otherwise engage in
concerted activities for their mutual aid or protection.'' 29 U.S.C.
401(a). Congress found that to accomplish this objective, ``it is
essential that labor organizations, employers, and their officials
adhere to the highest standards of responsibility and ethical conduct
in administering the affairs of their organizations, particularly as
they affect labor-management relations.'' Id. Congress simultaneously
found that public reporting by employers was one way to accomplish
this, given that the substance of employer persuader activities was
often ``unethical.'' S. Rep. 187 at 11, LMRDA Leg. Hist. at 407.
The proposed revision to Form LM-10 would increase transparency
regarding which Federal contractors and subcontractors are engaging in
persuader activities. Confirming a filer's status as a Federal
contractor, as well as its Unique Entity Identifier, as part of a full
explanation of persuader activities will provide a method for the
public, enforcement agencies and employees to quickly identify which
Federal contractors are reporting persuader activities in a given year.
This increased transparency benefits the employees subject to the
employer's persuader activity by giving them relevant information about
the source of communications that seek to influence their rights--as
intended by Congress in enacting the LMRDA. For example, employees have
a particular interest in knowing whether their employers are Federal
contractors because, as taxpayers themselves, those employees may not
wish to be indirectly financing persuasion campaigns regarding their
own rights to organize and bargain collectively. Although the persuader
campaigns are not themselves reimbursable under the Federal contract or
subcontract, the government is paying Federal dollars for goods and
services, sometimes in large amounts, which supports such contractors'
businesses. Additionally, by learning of the previously unknown Federal
contractor status their employer enjoys, those employees would have the
information that would allow them to meaningfully exercise their right
to choose whether to contact their representatives in Congress about
Federal appropriations underlying the contracts with their employers or
work with advocacy groups or the media to disseminate their views as
employees to a wider audience. This is consistent with Congress'
expectations when enacting the LMRDA--that in the public interest, and
consistent with First Amendment rights to speak out on these issues,
citizens would have the benefit of public reports regarding employer
conduct that falls in a ``gray area.'' S. Rep. NO. 86-187 at 11 (1959),
reprinted in 1 NLRB, Legislative History of the Labor-Management
Reporting and Disclosure Act of 1959, at 407 (persuader activities
``should be exposed to public view, for if the public has an interest
in preserving the rights of employees then it has a concommitant
obligation to insure the free exercise'' of those rights).
The requirement that an employer provide its Unique Entity
Identifier, if it has one, will prevent confusion. Two or more
employers may have a similar name. Individual employers often use
multiple names, including trade, business, assumed or fictitious names,
such as a DBA (``doing business as'') designation. All Federal
contractors have their own individual identifiers to seek and secure
Federal contracts.\10\ By requiring employers to provide this
identifier, members of the public and employees will be able to confirm
the true identity of the employer.
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\10\ See: <a href="https://www.acquisition.gov/far/part-4#FAR_Subpart_4_11">https://www.acquisition.gov/far/part-4#FAR_Subpart_4_11</a>.
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Increased transparency also allows procurement agencies to ensure
that the employer is not charging the Government for, and receiving
reimbursement for, these costs. This, in turn, informs the public of
how Federal monies are spent and the safeguards in place to prevent
taxpayer dollars from funding disruptions to harmonious labor
relations, even if these activities are not unlawful. See S. Rep. 187
at 10-12, LMRDA Leg. Hist. at 406. Given the potential for disruption,
the public, like employees, has an interest in knowing whether the
government is indirectly funding persuader activity by engaging in
business with these companies. The required disclosure of such
information is consistent with and fully authorized by sections 203 and
208 of the LMRDA and their broad grant of authority to prescribe the
form of the required reports. 29 U.S.C. 433, 438.
Knowledge of such information would also enable members of the
public to understand which Federal agencies are contracting with
employers
[[Page 55959]]
who are engaging in persuader activity. The public and employees would
benefit from knowing whether a specific Federal agency is choosing to
do business with an employer that is attempting to influence the
exercise of workers' rights to choose whether to organize and bargain
collectively. This public exposure would allow for an open public
discussion and debate about the prevalence of persuader activity and
the extent to which specific Federal agencies might be indirectly
supporting such activities by doing business with employers that engage
in persuader activities.
Both the public and employees would benefit from knowing whether
the government is choosing to do business with an employer that is
frustrating, or influencing the exercise of, workers' rights to choose
whether to organize and bargain collectively. It would help the public
and employees to have access to full and transparent reports of such
persuader expenses and activities.
D. Alternatives
There are three significant possible alternatives to the one
checkbox and two lines that the Department is considering in drafting
this proposed Form LM-10 modification: (1) no modification of Item 12,
(2) only utilizing the checkbox modification, and (3) only utilizing
the two lines. The first alternative, no modification to Item 12 at
all, leaves the same reporting gaps described above and the Department
believes that the public and employees are clearly served by the
increased reporting. Moreover, the cost of the proposed modification is
so small, especially as compared to the benefit of bridging the
previously discussed information gaps, that the Department did not
propose leaving the Form LM-10 as it was before the modification. The
second alternative, only creating a new checkbox, would provide the
public with some knowledge of which Federal contractors hired a
persuader but without an easy method to identify the contractor through
its Unique Entity Identifier and without a full explanation of the
Federal contracting agency(ies) involved. Finally, the third
alternative of adding the two lines--for entry of the Unique Entity
Identifier and the Federal contracting agency(ies) involved--but not
adding the checkbox would remove the clear benefit to the public and
employees of ease of access involving the checkbox--as was discussed in
Subsection C above, part of the benefit of the proposed modification is
the ease of access to information about contractor status for the
public. Without the proposed checkbox, there would be no easy way for
the viewing public to search and identify relevant Form LM-10 filings.
As such, the Department proposes that the full modification of Item 12
as outlined in this proposed form revision is necessary to fulfil the
purpose of the Form LM-10.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601 et seq.,
requires agencies to prepare regulatory flexibility analyses, and to
develop alternatives wherever possible, in drafting regulations that
will have a significant impact on a substantial number of small
entities. The Department has determined that this proposed form
revision will not have a significant economic impact on a substantial
number of small entities. The Department has estimated an increased
cost per reporting entity of only $8.60 per employer. A five-year
average of the number of employer filers for the LM-10 is 647. The
Small Business Administration (SBA) standard average yearly receipts
for a small business total $7.5 million.\11\ Assuming all 647 entities
are small entities of less than $7.5 million in revenue, the total cost
of $8.60 for all 647 entities would be $5,564.20 for the resulting
changes from the proposed modification of Item 12 of the Form LM-10.
Further using that figure of $7.5 million, the estimated increased cost
per reporting entity--a minimum of $8.60 and a maximum of $25.80, as
mentioned above--represents only between 1.15 ten thousandth and 3.4
ten thousandth of a percent of the $7.5 million in yearly receipts for
the average small business. Even if each were a particularly small
entity of only $100,000 in revenue size and each experienced the
maximum cost of $25.80, that would constitute .0258% of entity revenue,
which falls far below 3%, the significant impact threshold used in
other OLMS rulemakings.\12\ Therefore, a regulatory flexibility
analysis under the Regulatory Flexibility Act is not required. The
Secretary has certified this conclusion to the Chief Counsel for
Advocacy of the Small Business Administration.
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\11\ <a href="https://www.sba.gov/offices/headquarters/ogc_and_bd/resources/4562">https://www.sba.gov/offices/headquarters/ogc_and_bd/resources/4562</a>.
\12\ Form T-1 Rule, 85 FR 13438 (March 6, 2020). ``For this
analysis, based on previous standards utilized in other regulatory
analyses, the threshold for significance is 3% of annual receipts.''
Id.
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C. Paperwork Reduction Act
This statement is prepared in accordance with the Paperwork
Reduction Act of 1995 (PRA), 44 U.S.C. 3501.
Summary and Overview of the Proposed Form Revision
The following is a summary of the need for and objectives of the
proposed form revision. A more complete discussion of various aspects
of the proposal is found in the preamble.
The Department proposes to add to the Form LM-10 report a checkbox
requiring certain reporting entities to indicate whether they are
Federal contractors or subcontractors, as well as related information.
The LMRDA was enacted to protect the rights and interests of
employees, labor organizations and the public generally as they relate
to the activities of labor organizations, employers, labor relations
consultants, and labor organization officers, employees, and
representatives. Specifically, employers are required to file to
disclose the following in Form LM-10 filings, pursuant to LMRDA section
203 and subject to certain exemptions: payments and loans made to any
union or union official; payments to any of their employees for the
purpose of causing them to persuade other employees with respect to
their bargaining and representation rights, unless the other employees
are told about these payments before or at the same time they are made;
payments for the purpose of interfering with employees in the exercise
of their bargaining and representation rights, or obtaining information
on employee or union activities in connection with labor disputes
involving their company, except information obtained solely for use in
a judicial, administrative or arbitral proceeding; and arrangements
(and payments made under these arrangements) with a labor relations
consultant or other person for the purpose of persuading employees with
respect to their bargaining and representation rights, or obtaining
information on employee or union activities in connection with labor
disputes involving their company, except information obtained solely
for use in a judicial, administrative, or arbitral proceeding.
The Department, pursuant to the LMRDA, seeks to fill in clear and
present information gaps occurring in Form LM-10 reporting, regarding
filers' Federal contractor status. As has been stated above, the
Department is acting because it has a clear interest in understanding
the full scope of activities undertaken by employers that enter into
agreements to persuade employees not to exercise these rights,
including whether they benefit from Federal contracts. In addition,
[[Page 55960]]
separately reporting the contractor information will allow filers to
quickly fill out the form with a higher level of specificity, which
will allow for increased transparency, allowing the public and
employees to understand whether employers engaging in the activities
that require Form LM-10 reporting are party to a contract with the
Federal Government.
Methodology of the Burden Estimate
For purposes of the PRA, the cost burden of the modification to the
Form LM-10 proposed in this document has been calculated above and is
as follows. Based upon the existing LM form estimates, the Department
proposes that the modification to Item 12 will take no longer than 5
minutes to complete on average for approximately 647 filers in any
given year, thus adding approximately 5 minutes of reporting burden to
the existing Form LM-10 (which the current existing instructions
estimate to take approximately 35 minutes to complete, including the
current Item 12). The Form LM-10 is not an annually mandatory form for
employers; rather, it is only necessary in fiscal years during which
the employer engages in certain transactions or agreements. Further,
the modification to Item 12 does not impact all Form LM-10 filers, just
those that engage in persuader-related transactions--and only a subset
of those filers would need to complete all of Item 12.b. In addition,
only one Form LM-10 report must be filed per filing entity per
necessary fiscal year. Thus, the proposed form revision does not impact
the total number of Form LM-10 reports that the Department expects to
receive, nor does it affect the recordkeeping burden, as the Department
estimates that most employers that file and are Federal contractors or
subcontractors must already retain records relevant to that status
pursuant to Executive Order 13496 (Notification of Employee Rights
Under Federal Labor Law). See 29 CFR part 471, in particular Sec.
471.2(d), which states that employers must post the notice where
employees covered by the National Labor Relations Act engage in
activities relating to the performance of the contract. Instead, the
proposed form revision would result only in an increase in reporting
burden of 5 minutes per Form LM-10 and an overall increase of 3,235
burden minutes, or 53.9 burden hours, for Form LM-10 filers. However,
as explained in the E.O. 12866 regulatory impact section, the
Department seeks comment on whether the contractor status determination
would require further review time, such as an additional 10 minutes to
check with those on the employer's staff who conducted the E.O. 13496
review. If the form took an additional 15 minutes to complete the new
Item 12, rather than the 5-minute estimate, then Form LM-10 filers
would see an overall increase of 9,705 burden minutes, or 161.75 hours.
The proposed form revision will have no impact on the other 11
information collections approved under ICR #1245-0003. The summary of
the burden below accounts for the burden for all ICs (reports) in ICR
1245-0003.
Conclusion
As this proposed form revision requires a revision to an existing
information collection, the Department is submitting, contemporaneous
with the publication of this document, an ICR to amend the burden
estimates under OMB Control Number 1245-0003 and revise the PRA
clearance to address the clearance term. A copy of this ICR, with
applicable supporting documentation, including among other items a
description of the likely respondents, proposed frequency of response,
and estimated total burden may be obtained free of charge from the
<a href="http://RegInfo.gov">RegInfo.gov</a> website at: <a href="https://www.reginfo.gov/public/do/PRAOMBHistory?ombControlNumber=1245-0003">https://www.reginfo.gov/public/do/PRAOMBHistory?ombControlNumber=1245-0003</a> (this link will be updated
following publication of this proposal) or from the Department by
contacting OLMS at 202-693-0123 (this is not a toll-free number)/email:
<a href="/cdn-cgi/l/email-protection#a7e8ebeaf4f7d2c5cbcec4e7c3c8cb89c0c8d1"><span class="__cf_email__" data-cfemail="d29d9e9f8182a7b0bebbb192b6bdbefcb5bda4">[email protected]</span></a>.
Agency: Department of Labor, Office of Labor-Management Standards.
Type of Review: Revision of a currently approved collection.
OMB Number: 1245-0003.
Title of Collection: Labor Organization and Auxiliary Reports.
Forms: LM-1--Labor Organization Information Report, LM-2, LM-3, LM-
4--Labor Organization Annual Report, LM-10, Employer Report, LM-15--
Trusteeship Report, LM-15A--Report on Selection of Delegates and
Officers, LM-16--Terminal Trusteeship Report, LM-20--Agreement and
Activities Report, LM-21--Receipts and Disbursements Report, LM-30--
Labor Organization Officer and Employee Report, S-1--Surety Company
Annual Report.
Affected Public: Private Sector--Business or other for-profits and
not-for-profit institutions.
Estimated Number of Annual Respondents: 32,791.
Estimated Number of Responses: 35,067.
Frequency of Response: Varies.
Estimated Total Annual Burden Hours: 4,644,785.
Estimated Total Annual Other Burden Cost: $0.
The Department invites comments on all aspects of the PRA analysis.
The Department is particularly interested in comments that:
<bullet> Evaluate whether the proposed collection of information is
necessary for the proper performance of the functions of the agency,
including whether the information will have practical utility;
<bullet> The accuracy of the agency's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used, and the agency's estimates evaluate
associated with the annual burden cost incurred by respondents and the
government cost associated with this collection of information;
<bullet> enhance the quality, utility, and clarity of the
information to be collected; and
<bullet> minimize the burden of the collection of information on
those who are to respond, including through the use of appropriate
automated, electronic, mechanical, or other technological collection
techniques or other forms of information technology, e.g., permitting
electronic submissions of responses.
Comments submitted in response to this document will be considered,
summarized and/or included in the ICR the Department will submit to OMB
for approval; they will also become a matter of public record.
Commenters are encouraged not to submit sensitive information (e.g.,
confidential business information or personally identifiable
information such as a social security number).
D. Unfunded Mandates Reform
This proposed form revision will not include any Federal mandate
that may result in increased expenditures by State, local, and tribal
governments, in the aggregate, of $100 million or more, or in increased
expenditures by the private sector of $100 million or more.
E. Small Business Regulatory Enforcement Act of 1996
This proposed form revision is not a major rule as defined by
section 804 of the Small Business Regulatory Enforcement Fairness Act
of 1996. This proposal will not result in an annual effect on the
economy of $100,000,000 or more; a major increase in costs or prices;
or significant adverse effects on competition, employment, investment,
productivity, innovation, or on the ability of the United States-based
companies to compete with foreign-
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based companies in domestic and export markets.
List of Subjects in 29 CFR Part 405
Employers, Reporting and recordkeeping requirements.
Signed in Washington, DC, this 31 day of August, 2022.
Jeffrey R. Freund,
Director, OLMS.
Note: The following appendix will not appear in the Code of
Federal Regulations.
Appendix A--Form LM-10
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[FR Doc. 2022-19229 Filed 9-12-22; 8:45 am]
BILLING CODE 4510-86-C
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</html>Indexed from Federal Register on September 13, 2022.
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