Schedules 11 and 12 of the Form LM-2 are designed to report certain information pertaining to officers (Schedule 11) and employees (Schedule 12).
Within these schedules, for each officer and employee listed, disclose their total wages, allowances received and disbursements to or on behalf of the officer or employee including disbursements for their personal benefit. Also disclose the allocation of their time spent during the year across the five categories, as defined in the instructions: representational activities, political activities/lobbying, contributions, general overhead, and administration.
Despite the simple description of these forms above, there are many nuances and exceptions to consider in order to properly complete the form. Below are some things to remember when preparing these schedules of your form:
Intro to Schedule 11 – All Officers and Disbursements to Officers
All union officers are required to be listed in this schedule. Union officer positions are typically identified in either the Constitution or bylaws. These positions are authorized to perform the functions of president, vice president, secretary, treasurer, or other executive functions of a labor organization, and any member of its executive board or similar governing body. On this schedule, any person who served in any of these roles for any length of time during the reporting period should be listed; regardless of whether any salary or other disbursements were paid to them or on their behalf.
In column C, disclose the status of each officer using 1 of the 3 letters defined below:
- “N” = a new officer who took office during the reporting period.
- “P” = a past officer who was not in office at the end of the reporting period.
- “C” = a continuing officer who was in office before the reporting period and was still in office at the end of the reporting period.
If any officer was not elected at a regular election in accordance with the constitution and bylaws, or other governing documents on file with OLMS, use Item 69 (Additional Information) to explain the manner in which the officer was chosen. This could simply be that a person was appointed by the President to fill the unexpired term of an officer that retired before the end of their term.
If an officer held more than one position during the year, list the last position held in Schedule 11 and report the other positions and corresponding dates in Item 69.
Intro to Schedule 12 – Disbursements to Employees
Some employees may not be individually reported in Schedule 12. List individually only those employees who received more than $10,000 in total gross salaries, allowances and other disbursements. For those who do not meet that threshold, the sum of their total of the salaries, allowances and disbursements for those employees are reported on a single line labeled “Total Received by All Other Employees Making $10,000 or Less.” Use Column C to report the name of any affiliate that paid any salaries, allowances, or expenses on behalf of a listed employee. Lost time payments to union members performing union-related work should also be reported in Schedule 12.
Schedule 11 & 12 Considerations:
Column D reports gross salary (total salary before tax withholdings and any other deductions). Include payments for “lost time” or time devoted to union activities. In Column E, enter the total allowances made to each officer on a periodic basis except for allowances paid for mileage or meals (these are reported in column F or G).
Column F reports the direct and indirect disbursements that were necessary for conducting official union business, other than amounts reported in Columns D and E:
- A direct disbursement is one made directly to the officer
- An indirect disbursement is a payment to a third party on behalf of the officer (e.g., union credit card or direct bill)
contact a member of the Labor Organization Group.
Include such items as meal and mileage allowances, meals and entertainment, and various goods and services furnished to officers and paid by the labor organization. Also include travel advances that are not considered loans and listed on Schedule 2 of the Form LM-2.
Column G reports all other direct and indirect disbursements to each officer or employee for which cash, property, goods, services, or other things of value were received by or on behalf of each officer and were essentially for the personal benefit of the officer and not necessary for conducting official business of the labor organization.
The DOL provides a streamlined method for reporting costs of automobiles provided to union officers and employees. If the vehicle was used more than 50% for union-related business, you may report all the costs in Column F of the officer or employee’s line along with an Item 69 comment that the vehicle was also available for personal use. Conversely, if more than 50% of the vehicle use was personal in nature, you may report all the related costs in Column G of the officer or employee’s line along with an Item 69 comment that the vehicle was also available for business use. If costs are reported in Column G, the union must also disclose the Item 69 the reduction in fair market value of the vehicle during the reporting period. This method is in lieu of allocating operating costs between Columns F and G.
The following are types of disbursements are to be excluded from Schedules 11 and 12:
- Indirect disbursements for airfare by a common carrier, or for temporary lodging, such as hotel room and tax charges; meaning if the officer’s airline ticket was purchased using the union’s credit card, this disbursement is not reported in Schedule 11 but rather it is reported based on the functional nature of the disbursement.
- Reimbursements for the purchase of fixed assets, investments or food and beverages for a membership meeting.
- Disbursements made to a third party as a result of an arrangement made by the officer that benefits the labor organization, such as costs of office rental and costs of membership meetings.
- Disbursements for office supplies, equipment and facilities used by officers and employees as well as the maintenance of assets used by officers and employees.
Column H presents the sum total of Columns D – G. Additionally, on the lines labeled “Total Officer Disbursements” and “Total Employee Disbursements” on Schedules 11 and 12, respectively, is the sum totals of each of Columns D – H.
Row I represents an estimated percentage of time spent of the activities that fall within Schedules 15 through 19. These estimates may be rounded to the nearest 10%, unless the total is less than 5% in which case you would round to the nearest percentage rather than enter zero. IT is understood that these percentages are best estimates and not exact figures.
One important and often overlooked item to be mindful of on Schedules 11 and 12 is at the bottom after the total disbursements is a space to enter deductions. In this space, enter the sum of all taxes, payroll deductions, or other deductions withheld from the gross disbursements on Schedules 11 and 12. This line should not be blank, unless you paid no salaries or did not actually withhold any taxes, payroll deductions, or other deductions. The totals of the deductions on Schedule 11 and 12 must agree to Item 67a on Statement B.
The Form LM-2, Schedules 11 and 12 should be completed as accurately as possible. For the official instructions and to obtain more detailed information, please refer to the form instructions published by OLMS. IF you are uncertain how to complete the Form or disclose unusual events or transactions that may have occurred during the reporting period, consult with a professional well-versed in the nuances of the Form LM-2.
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