As we’ve just noted in another posting published earlier this week, there are two ways to get a sense of how much employers are spending on reportable persuader activity. Generally, if consultants have no direct contact with employees, this is not reportable; only direct contact with workers is what is supposed to be reported.
Form LM-10 reports itemize and date reportable employer payments to all consultants hired during the employer’s fiscal year. When we crossmatch the persuader payment dates and amounts with the NLRB filings, we can construct a timeline of persuader expenditures (dates and amounts) around the petition filing, hearings, ULP filings and votes. Where employers hire multiple consultants we may discover total employer expenditures (see David Jamieson’s story about Amazon’s 2020 LM-10 filing), not just on a single consultant.
The LM-21 has distinct advantages. Part A requires the persuader to itemize receipts by the employers who engage them in reportable activity; Part B documents expenditures and Part C requires them to itemize payments to subcontractors by the employer campaign they work on. As noted earlier, the Office of Labor-Management Standards (“OLMS”) announced a Special Enforcement Policy in 2016 which indicated they would no longer enforce the requirements to complete Parts B and C. They did not, however, suspend the reporting requirements of Part D, and any persuader who files just one LM-20 for the consultant’s fiscal year must file an LM-21.
Increasingly, persuaders are hiring subcontractors instead of hiring employees. Subcontractors don’t require fringe benefit plans and have no guaranteed employment. They’re hired “just in time” for a specific campaign and paid off when the campaign is completed. The information contained in Part D is extremely useful when persuaders report it. These subcontractors are the “foot soldiers” of the persuaders and knowing how much they get paid as documented by a publicly available, consultant-approved Form LM-21 is useful for organizers and workers alike. This Part D itemization can be crossmatched with the names of the persuaders documented in Item 11(d) of the Form LM-20.
Besides the lack of disclosure which results directly from the OLMS 2016 Special Enforcement Policy (non-disclosure of receipts and disbursements), there is perhaps an even greater problem—relatively few persuaders bother to file a Form LM-21. Taken together, the Special Enforcement Policy and the lack of filings, there is a lot less disclosure about persuaders than there should be.
To better understand the problem, LaborLab created a list of persuaders from its calendar year (“CY”) 2021 and 2022 database of LM-20s. While this doesn’t encompass those consultants who have engaged in reportable persuader activity but didn’t file an LM-20, we believe this database is sufficiently comprehensive. After eliminating duplicate filings by the same consultant, we created a list of unique persuader consultants. There were 130 for CY 2021 and 132 for CY 2022. Note that OLMS reports filings by fiscal year (October 1 - September 30); we report by calendar year (January 1 to December 31).
For each one listed, we used the OLMS Public Disclosure web page yesterday to see whether a single LM-20 was filed by each consultant in CY 2021 or in CY 2022. This information is date sensitive, because filings are always coming in, which is why we used the real-time, on-line OLMS database. This is why LaborLab will continue to monitor CY 2021 and CY 2022 filings periodically and report updates.
In our search, we first looked only for consultants who indeed filed one or more LM-20 during each calendar year. Next, we looked for those who indeed filed an LM-21 for each CY in which they were owed. Finally, we looked to see if they itemized receipts for Part B and if they did, what was the total amount of receipts reported.
We found that for CY 2021, of the 130 consultants on our list, 23 did not file any LM-20 during CY 2021, which means that they did not “owe” an LM-21 for CY 2021. That leaves 107 unique persuaders who “owe” a CY 2021 LM-21.
For CY 2022, of the 132 consultants on our list, we found that 30 did not file any LM-20 during CY 2022, which means that they did not “owe” an LM-21 for CY 2022. That leaves 102 unique persuaders who “owe” a CY 2022 LM-21. The remaining information from our research is summarized in the bullet points below:
- For CY 2021, 107 unique persuaders “owed” LM-21s. Only 47 have filed, as of yesterday; 60 have not yet done so.
- For CY 2022, 102 unique persuaders “owed” LM-21s. Fifty-two (52) have done so as of yesterday; fifty (50) have not done so, as of yesterday. Keep in mind that the LM-21 is due 90 days from the close of the employer fiscal year, so consultants who have a different fiscal year ending date other than December 31 may still not yet be required to file.
- For CY 2021, of the 47 LM-21s filed as of yesterday, twenty-five (25) itemized receipts. Twenty-two (22) did not do so.
- For CY 2022, of the 52 LM-21s filed as of yesterday, twenty-seven (27) itemized receipts and 25 did not do so.
- For CY 2021, total receipts for those 25 who itemized receipts was $16,855,716.
- For CY 2022, total receipts for those 2 who itemized receipts was $18,870,011.
LaborLab will continue to monitor both CY 2021 and CY 2022 LM-21 and LM-10 filings and report our findings on an on-going basis. Clearly, rescinding the 2016 Special Enforcement Policy will greatly improve transparency, but additionally, OLMS must crackdown on those persuaders who haven’t yet filed their LM-21s and the employers who haven’t yet filed their LM-10s. This is the only way in which the promise of putting the “management” back in the “Labor-Management Reporting and Disclosure Act” can truly be realized.
Published April 6, 2023