bursements with the purpose thereof, in connection with any labor relations advice or services.

There are certain exceptions from these latter reporting requirements, as follows:

1. Reports are not required of regular officers, supervisors, or employees of any employer concerning the compensation they receive in connection with their work for such employer.

2. An attorney who is a member in good standing of the bar of any State need not report any information which is lawfully communicated to him in the course of a legitimate attorney-client relationship.

3. No person is required to make reports if he only engaged or agreed to engage in the following activities: giving advice to employers; representing employers before a court, administrative agency, or arbitration tribunal; and engaging in collective bargaining on behalf of employers with respect to wages, hours, or other conditions of employment.

SURETY COMPANY REPORTS

The Act contains bonding provisions. (See Title V, Safeguards for Labor Organizations, Section 502.) A 1965 amendment added a provision requiring surety companies to file annual reports with the Secretary of Labor describing their bonding experience under this Act and the Welfare and Pension Plans Disclosure Act. The Surety Company Annual Report, Form S-1, was developed for this purpose. It consists of four parts; I. Identification; II. Premium Data; III. Loss Data; and IV. Itemization of Losses Reported During Year.

Each surety company which has in force any LMRDA and/or WPPDA fidelity bonds, even though the volume of such bonds may be small, must file an S-1 report disclosing its annual totals of all such fidelity writings, indicating its experience separately for honesty and faithful discharge contracts under each act. It need not submit an S-1 for each separate bond or class of bonds that it has written. A single report covering a group of companies is not acceptable.

A surety company is not required to indicate on the S-1 the number of persons bonded, bonds in force, or bonds on which direct losses were paid, and it need not name the defaulter when reporting a loss. However, it must include in Part IV each loss on which notice was received during the year, whether or not the involved labor union, trust or plan is insured under a contract reported in Parts II and III.

The data called for by the form do not show losses which were not claimed. Loss data are based on the amount of the loss or the amount of the bond coverage available, whichever is less. Losses reported are not net losses; i.e., less salvage, which is applied to reduce losses in the year collected, regardless of when the loss was sustained.

DISCLOSURE AND ENFORCEMENT

All reports are public information. The Labor Department's Public Document Room, located at 8757 Georgia Avenue, Silver Spring, Md., just outside Washington, maintains copies of all reports for public disclosure. Area offices of the Labor-Management Services Administra

tion, which are located in 24 cities, also have on file reports for unions within areas covered. They are subject to inspection by any person, and copies may be purchased by any person upon payment of a copying charge. Unions must make the reported information available to members, and permit members for just cause to examine any books and records necessary to verify the reports. Basic records to support all reports must be kept and preserved for at least 5 years. Criminal penalties are provided for willfully falsifying, withholding, or destroying reports or other required information. When it appears that any person has violated or is about to violate Title II, the Secretary of Labor may bring a civil action in the proper Federal district court for appropriate relief, including an injunction.

The filing requirements of former sections 9 (f) and (g) of the National Labor Relations Act are repealed since they have been replaced by the new requirements of this law.

For copies of the reporting forms and instructions, write to the Office of Labor-Management and Welfare-Pension Reports, U.S. Department of Labor, Washington, D.C. 20210.

TRUSTEESHIPS (TITLE III)

Under the act trusteeships may be established over subordinate unions only in accordance with the constitution and bylaws of the labor organization imposing the trusteeship, and for one or more of the following purposes:

1. Correcting corruption or financial malpractice;

2. Assuring the performance of a collective bargaining agreement or other duties of a bargaining representative;

3. Restoring democratic procedures; or

4. Otherwise carrying out the legitimate objects of such labor organization.

Labor organizations imposing the trusteeship must file special reports within 30 days of the establishment of a trusteeship and must report semiannually thereafter.

In the initial report, these facts are to be included:

1. Name and address of the subordinate organization.

2. Date the trusteeship was established.

3. Detailed report of reason or reasons why the trusteeship was established or why it has been continued.

4. A statement of the extent to which members of the organization under trusteeship have any part in selecting delegates to represent them at union conventions or at other policymaking meetings and in electing the officers of the labor organization which has assumed the trusteeship.

5. A complete account of the financial status of the trusteed organization at the time the trusteeship went into effect.

Up-to-date information on matters included in the initial report (except the information listed under No. 5) must be reported to the Secretary of Labor in semiannual reports each 6 months after the initial report is filed, for so long as the trusteeship remains in effect.

In addition, the organization imposing a trusteeship must file on behalf of the subordinate organization the annual reports required by Title II and must use the form LM-2 for this purpose.

In administering a trusteeship two practices are specifically prohibited. First, it is unlawful to count votes of convention delegates from the subordinate organization unless they were elected by secret ballot in an election where all members in good standing could participate. Second, transfer of any funds from a subordinate to a supervisory organization, except normal per capita taxes and assessments payable by other subordinate bodies, is also unlawful. The act, however, does not prevent distribution of the subordinate union's assets in accordance with its constitution and bylaws upon its bona fide dissolution.

Generally, the means of enforcing trusteeship reporting requirements, and the criminal sanctions for improper reporting, parallel those available for the annual reports required by Title II. Civil suit to secure compliance with the trusteeship standards may be brought by any member, or by any subordinate body affected by violation of this title, as well as by the Secretary when he finds, as a result of a complaint in writing by a member of a subordinate organization or by a subordinate organization and after investigation, that there is probable cause to believe a violation has occurred. But when the Secretary files suit the court's jurisdiction is exclusive. A trusteeship is presumed valid for 18 months, from its establishment, after which the burden of proof is on the parent organization to justify its continuation.

ELECTIONS (TITLE IV)

This law requires national or international labor organizations, except federations of such organizations, to elect officers at least once every 5 years either by secret ballot among members in good standing, or at a convention of delegates chosen by secret ballot. Intermediate bodies are required to hold elections not less frequently than once every 4 years either by secret ballot among members in good standing or by officers representative of such members who were chosen by secret ballot. Local labor organizations must elect officers by secret ballot among members in good standing at least once every 3 years. The act includes the following standards for conducting elections of officers:

1. A candidate has a right, enforceable by pre-election private suit as well as by the Secretary of Labor, to distribution of campaign literature to the membership at his own expense, campaign literature must be distributed on equal terms for all candidates and no discriminatory use may be made of lists of members. Lists of members under union security agreements must be made available for inspection by candidates within 30 days prior to an election;

2. Adequate safeguards must be provided to insure a fair election, including the right of any candidate to have an observer at the polls and at the counting of ballots;

3. A reasonable opportunity to nominate candidates must be provided;

4. In an election conducted by secret ballot, each member in good standing is entitled to one vote:

5. Every member in good standing is eligible to be a candidate and to hold office, subject only to reasonable qualifications and the prohibitions on union officeholding in Title V of the Act, and

to support the candidates of his choice without interference or reprisal;

6. Notice must be given by mail to each union member at his last known home address at least 15 days before a secret ballot election;

7. No member is subject to disqualification as a voter or candidate by reason of default or delay in paying dues checked off by an employer; and

Elections required by the act must be conducted in accordance with each organization's constitution and bylaws unless these provisions are inconsistent with the act.

Ballots and other election records must be preserved for one year. Use of union dues, assessments and similar levies by a labor organization and use of any moneys of an employer to promote the candidacy of any person is prohibited. If the Secretary finds, after a hearing upon application by a member, that the procedures in the labor organization's constitution or bylaws for removing an elected local union officer guilty of serious misconduct are inadequate, members may then, for cause shown and after notice and hearing, remove such officer in a secret ballot referendum conducted by the officers of the local union.

A member of a labor organization who has a complaint concerning an election or removal requirement must first use the remedies available within the union to secure relief. If these union remedies have been exhausted or a final decision has not been issued within three months after invoking such remedies, a complaint may be filed with the Secretary of Labor within one month. A challenged election is presumed valid until a final decision is made. If the Secretary, after investigation, finds probable cause to believe a violation has occurred, which has not been remedied, he may bring suit in the district court. If the court finds that an election has not been held within the prescribed time or that a violation occurred which may have affected the outcome of an election, the court shall direct the conduct of a new election under the supervision of the Secretary. The Secretary certifies the names of the persons elected, or the results of the removed vote, to the court, for entry of an appropriate order.

SAFEGUARDS FOR LABOR ORGANIZATIONS (TITLE V)

Officers, agents, shop stewards or other representatives of labor organizations are declared by this law to occupy positions of trust in relation to such organizations and their members as a group. This requires them to hold and use money and property of the organization solely for the benefit of the members and in accordance with the constitution and bylaws of the organization. Whenever any person is alleged to have violated these duties and the union, upon request, fails to sue or secure appropriate relief within a reasonable time after the request, any member, upon leave of the court, may sue for an accounting or other appropriate relief, including the recovery of profits which might have been secured through activities in violation of fiduciary duties. The law also makes it a Federal crime for an officer or employee to embezzle, steal or convert to his own or another's use any funds of a labor organization.

BONDING REQUIREMENTS

All officers, agents, and other representatives or employees of labor organizations, who handle funds or other property, must be bonded by a corporate surety in an amount equal to 10 percent of the funds handled during the preceding fiscal year but not in excess of $500,000. Persons serving in similar capacities in trusts in which a labor organization is interested are subject to the same requirement. Excepted from the requirement are labor organizations whose property and annual financial receipts do not exceed $5,000 in value.

If the labor organization or the trust in which a labor organization is interested does not have a preceding fiscal year, the amount of the bond shall be, in the case of a local labor organization, not less than $1,000, and in case of any other labor organization or of a trust in which a labor organization is interested, not less than $10,000. The bond is to provide protection against loss by reason of acts of fraud or dishonesty; prior to a 1965 amendment the Act required a faithful discharge of duties bond. Any person who is not covered by such bonds shall not be permitted to receive, handle, disburse, or otherwise exercise custody or control of the funds or other property of a labor organization or of a trust in which a labor organization is interested.

The corporate surety must hold a grant of authority from the Secretary of the Treasury under the Act of July 30, 1947 (6 U.S.C. 6-13), as an acceptable surety on Federal Bonds: Provided, That when in the opinion of the Secretary a labor organization has made other bonding arrangements which would provide the protection required by this section at comparable cost or less, he may exempt such labor organization from placing a bond through a surety company holding such grant of authority.

MAKING OF LOANS; PAYMENT OF FINES

The act also prohibits loans in an aggregate amount of more than $2.000 by a union to an officer or employee and prohibits unions and employers from paying the fine of any of their officers or employees convicted of willfully violating the act.

Prohibitions against certain persons holding union office

A person may not serve as a union officer, director, trustee, manager, business agent, organizer or other employee (other than as an employee performing exclusively clerical or custodial duties), as a labor relations consultant, or as an officer, agent or employee of a group or association of employers dealing with a union within 5 years after conviction or end of imprisonment for certain specified crimes, unless citizenship rights are restored or unless the Board of Parole of the Department of Justice has determined, in a hearing, the suitability of service by persons convicted of such crimes. In addition, the labor organization or its officers may not knowingly permit a person ineligible for these reasons to hold office.

Improper payments and fees

The Labor-Management Reporting and Disclosure Act tightens and clarifies the prohibition in section 302 of the Taft-Hartley Act concerning employer payments and loans to employee representatives.