The duties set forth in the Code spring from three fundamental sources. They are: (1) The fiduciary duties owed to the Union by those acting on behalf of the Union; (2) The democratic nature of the Union, whose members are the ultimate source of all authority; and (3) The need for officers, staff, and members to have confidence in the proper functioning of the Union.

A. Fiduciary Duty

Union officers, staff, and representatives are agents of the Union. Their authority comes strictly from the fact that they are acting on behalf of the Union and its membership. In the exercise of that authority they have certain fiduciary duties. Although agents of the Union must sometimes weigh the interests of some members of the Union against the interests of others, the only interests they can serve are those of the Union and its members. They are not entitled to use their power for personal advantage.

The existence of these fiduciary duties is reflected in United States federal law. LMRDA §501(a) states:

The officers, agents, shop stewards, and other representatives of a labor organization occupy positions of trust in relation to such organization and its members as a group. It is, therefore, the duty of each such person, taking into account the special problems and functions of a labor organization, to hold its money and property solely for the benefit of the organization and its members and to manage, invest, and expend the same in accordance with its Constitution and Bylaws and any resolutions of the governing bodies adopted thereunder, to refrain from dealing with such organization as an adverse party or in behalf of an adverse party in any matter connected with his duties and from holding or acquiring any pecuniary or personal interest which conflicts with the interest of such organization, and to account to the organization for any profit received by him in whatever capacity in connection with transactions conducted by him or under his direction on behalf of the organization.

These duties are also at the heart of the oath of office required by the IBT Constitution. Each officer swears that:

I will faithfully use all of my energies and abilities to perform the duties of my office.

I will, at all times, act solely in the interests of our members, [and] devote the resources of our Union to furthering their needs and goals.

I will never forget that . . . it is the members whom I will serve.

Much of the Code is devoted to explaining the full scope of this fiduciary duty.

Although the provisions of the Code focus on the duties of agents of the Union, rank-and-file members also owe duties to the Union. According to the IBT Constitution, Article II, §2(a), members pledge their honor to bear true and faithful allegiances to the IBT and their local unions.

B. Democracy

Without democracy, a union is a union in name only. A true union must be a democratic institution. Like the governments of the United States and Canada, the Union is a representative democracy, not a "pure" democracy. Not every decision must be taken directly to the membership. The members elect their officers. Power is delegated to the leadership to make many decisions without going back to the membership.

The check on such delegated power in a representative democracy is the holding of elections at regular intervals. If the members disapprove of the way the officers have exercised their delegated power, they can change the Union's bylaws or replace their leadership at the next election. Consideration of these consequences can persuade the officers not to abuse their delegated powers.

For a representative democracy to operate properly, two conditions are essential. First, elections must be conducted fairly. And second, members must have access to the information they need to make informed choices when they vote. These two conditions must also be met when the membership is asked to approve specific decisions of the leadership (such as dues increases or major purchases). That is, voting at membership meetings should be conducted fairly, and before casting their votes at meetings, members should have access to all the relevant information in an easily understandable form.

Representative democracy also requires participation by the members. Although no provision of the Code of Conduct requires members to stay abreast of Union activities, attend meetings, or even vote in elections, all members of the Union must understand how valuable they are to have an effective Union.

Various provisions of federal law are designed to protect and enhance union democracy. With respect to elections, federal law sets forth requirements concerning the procedure for nominating and electing candidates, the distribution of campaign literature, and the financing of campaigns. (Article XXII of the IBT Constitution also sets a number of requirements for local elections.)

As for disclosure, federal law requires unions to prepare an annual report containing information regarding various procedures (such as those for calling meetings, disciplining members, and ratifying contracts) and Union finances. The information in this annual report must be available to members. Federal law also requires union officers and employees to file personal financial information with the Department of Labor regarding their relationships with vendors and employers.

Effective democratic procedure is essential to maintaining an ethical union.

C. Confidence

Not only must Union officers act in accord with their fiduciary duties and their obligations to the democratic process, they must appear to do so.

For members of the Union and the public to be confident that Union business is being conducted in an ethical manner, the Code prohibits actions that would raise serious suspicions. It is not a defense, for example, for officers to say that they were not influenced by associating with organized crime or by having a substantial financial interest in a vendor that they have selected for a Union contract. The conduct is prohibited because an ordinary person could be influenced.

In addition, the Code contains provisions requiring disclosure of various actions by Union leadership. Such disclosure can give members confidence that their Union is being managed properly.

Certain principles set limits on what ought to be included in the Code. These include: (1) efficiency, (2) confidentiality, and (3) local autonomy. A fourth limitation is implicit but should be mentioned - the Code cannot and does not supersede governing law, including the law of Canada.

A. Efficiency

The Union must be able to carry out its business efficiently and effectively. That is one reason for having representative, instead of "pure," democracy. The Union could not function if every purchase of paper supplies required a membership vote.

The need for efficiency sets outer limits on the duties described above. To give just two examples:

1. Members should have access to information concerning the operation of the Union. But officers and staff could not operate productively if they had to stop work and produce records whenever a member might want to see them. Time, place, and even need-to-know restrictions on access are necessary and appropriate for efficiency.
2. Employees should not be reimbursed for expenses beyond what they actually incurred. But keeping a record of every petty expenditure could be an undue burden. A reasonable allowance for certain types of expenses - without requiring an accounting by the employee - can be an appropriate alternative to reimbursement of expenses, in the interest of efficiency.

B. Confidentiality

Despite the principle of democracy and the need for members to have access to relevant information, certain matters must be kept confidential to protect the privacy rights of members and employees. Proprietary information used by the Union in its dealings with employers must also remain confidential.

C. Local Autonomy

The IBT Constitution recognizes the importance of the autonomy of the local unions that make up the IBT. Specific circumstances at each local vary widely, sometimes justifying differing responses to similar issues. Also, reasonable people can have honest differences of opinion. Therefore, where appropriate, the Code recognizes the virtue of letting locals respond to particular ethical issues in their own way. The Code is meant to complement the IBT Constitution, local bylaws, and other required rules of conduct, not to substitute for them.

Local autonomy cannot, however, be an excuse for disregarding ethical obligations.

D. The Laws of Canada and Other Governments

This Code is subject to the labor laws of the nations, states, provinces, and local governments where the Union conducts its affairs. In particular, the IBT Constitution recognizes that Canadian members and Canadian local unions are part of a unique and sovereign nation which is characterized by the distinctiveness of its political and legal institutions and which maintains its own labor traditions. The Code must therefore be applied and interpreted in Canada in a manner consistent with Canadian laws and labor relations traditions. It shall not have the effect of subjecting Canadian members and Canadian local unions to rules contrary to the laws and labor relations traditions that would otherwise be applicable in Canada.

The purpose of the Code is to inspire and encourage ethical behavior. The purpose is not to create excuses for punishing people. The underlying principles for compliance and enforcement are:

A. The first priority is compliance. The Code and its implementing structures should strive to make compliance easy. The goal is a user-friendly system.

B. Although sometimes punishment is required, it should be used only when appropriate. Good faith errors in complying with the Code should be corrected but should otherwise be treated as opportunities for learning and growth.

C. When enforcement is necessary, it should be both fair and effective.