The Office of Labor-Management Standards (OLMS) today published a final rule rescinding the Form T-1 Trust Annual Report. The final rule’s effective date is January 31, 2022.
The rule instituting the Form T-1, promulgated by the last Administration, imposed unjustified paperwork burdens on labor organizations. These requirements were redundant to existing filing requirements, such as Internal Revenue Service (IRS) reporting, and, thus, unnecessary to detecting or deterring wrongdoing or preventing the circumvention or evasion of reporting requirements under the Labor-Management Reporting and Disclosure Act (LMRDA).
The department had published a final rule establishing the Form T-1 on March 6, 2020. It required labor unions with $250,000 or greater in total annual receipts and which file the Form LM-2 annual union financial disclosure report to file this separate report covering the finances of certain trusts in which they are interested, such as apprenticeship and training plans, labor-management cooperation committees, strike funds, and building corporations.
On March 29, 2021, OLMS announced that it would not enforce the final rule until one year after the date a labor organization’s first Form T-1 was due. On May 27, 2021, the OLMS proposed to rescind the Form T-1.
Upon review of the comments received, OLMS determined that the Form T-1 would not provide additional information necessary for OLMS to track labor organization fraud. Even without the Form T-1, existing filing through agencies such as the department’s Employee Benefits Security Administration and the IRS provide the public with needed disclosures. Further, union members will continue to receive detailed information about their union’s finances, including the identity and contact information of the union’s trusts, through the annual Form LM-2 report available in the OLMS Public Disclosure Room.
For further information, please visit the OLMS website at: www.dol.gov/agencies/olms/laws/regulations/final-rule-t1.