Of the LMRDA’s many provisions, Titles II and V are central to preventing corruption. Title II requires unions to file annual financial reports detailing their “financial condition and operations” with the Department of Labor. The reports, which must be filed within 90 days of a union’s fiscal year end (typically April 1st), provide detailed information on a union’s dues and other income sources, assets, and line-item expenditures. The reports, known as LM-2s, LM-3s, and LM-4s, also include union leaders’ salaries and fringe benefits (depending on a union’s yearly income). Title II also requires union leaders to file reports on potential conflicts of interests (LM-30s) and businesses to file reports on labor consultants (LM-10s and LM-20s).
Title V contains provisions protecting union assets, including provisions for unions members to sue in civil court. Title V also states that union officers “occupy positions of trust” in the union, and requires them to obtain proper bonding against “loss by reason or acts of fraud or dishonesty.”
The LMRDA was conceived on the premise that basic democratic principles and minimal disclosure requirements would facilitate self-oversight and deter against corruption within the movement. The Senate Committee on Labor argued for “the desirability of minimum intervention by government” and that “great care should be taken not to undermine union self-government.” The Senators also recognized that “given the maintenance of minimum democratic safeguards and details essential information about the unions the individual members are fully competent to regulate union affairs.” Senator McClellan wrote in particular:
If we want fewer laws—and want to need fewer laws—providing regulation in this field, … we should give union members their inherent constitutional rights and … protect union members in those rights. By so doing we will be giving them the tools they can use themselves. That is all I propose to do by this amendment.