C-377: A Better (but still problematic) Bill

Later today the House of Commons will vote on amendments and then on an amended Private Member’s Bill, which would force Unions and other Labour Organizations to disclose how they spend their members’ dues.  The purpose of Bill C-377 is laudable: to force union transparency and to make union leaders accountable for how they spend their members’ dollars.  This would be accomplished via a publically assessable website.  But the question remains: accountable to whom??

I have previously posited in this blog (and to the over 400 constituents) who have called, written and e-mailed me, asking that I not support Bill C-377, that I absolutely agree that union members ought to have an unfettered right to see how their union bosses spend their cash.   What is less clear to me is that members of the public generally have a similar right.

As a non-member of every union in the world, what possible interest do I have in how unions spend their cash??  Well, the proponents argue that because unions operate tax free, because strike pay is non-taxable and most importantly, because all of it is funded by union dues that are tax deductible, that somehow the public has a legitimate interest in how these forgone tax dollars are spent.

It’s not the worst argument ever proffered; in fact it is pretty clever.  The problem is it’s fallacious.

The reality is that the public is generally not entitled to this type of disclosure from private organizations who receive even direct funding from government.  Although it is public information that the Aboriginal Multi-Media Society of Alberta recently received money from Heritage Canada to promote aboriginal language radio programming, the Society is not required to open its books to the public.  Similarly, when the Edmonton Women’s Shelter receives grants to combat violence against women, they are not required to disclose publically how much they pay their Executive Director.

Regardless and notwithstanding that unions do not receive direct financial assistance from government, the brains behind Bill C-377 argue that tax deductible union dues are “akin to public dollars”.  Well they aren’t (not if akin means equal to). The cost to the federal treasury of a union due dollar is the marginal tax rate of the employee from which it is deducted.  Even for highly paid building tradesmen, that is well under 50 cents.

But that really misses the point.  The list of entities that benefit from being operated on dollars that are not taxable in the hands of the person or entity cutting the cheque is indeed a long one.  The Law Society, The Bar Association, even the Chamber of Commerce operate entirely on fees that were tax deducted by the person or company paying those fees.  As a lawyer, my corporate clients wrote off the cost of legal advice and my law firm deducted the salaries of our staff and our rent before the partners calculated “taxable income”.  In fact, hockey tickets and drinks before the game for clients are a hospitality expense and entitled to a 50% tax deduction.  Yet, neither the Law Society, Bar Association, Chamber, the law firm, my secretary, the firm’s landlord, the Oilers nor the nearby pub have to disclose how they spend “tax deducted dollars”.

Why??  Because tax deductibility is not the same thing as public dollars.  If it were otherwise, every dollar not subject to taxation theoretically would be a public dollar.  I find the notion troubling that the public somehow has an interest in tracking every dollar including those not subject to taxation. There can be no public interest in how private entities spend private money legally.

The inability of the public to do anything with this information reinforces the notion that only members of the club ought to have access.  If it is disclosed that a union president’s salary or expenses are exorbitant or that the union is spending money on “questionable” political activities, what is a member of the public to do with that information??  Only members of the club can vote in new leadership to change the direction of how the dues are spent.

I suspect that amendments to Bill C-377 will improve the bill considerably. By changing the threshold from $5,000 to $100,000, removing addresses of recipients and allowing electronic filing, certainly address some of the privacy concerns and the cost of compliance.

However, the Bill is still based on a fallacious premise—that tax deductibility creates a public interest.  As a member of the public, who has no intention of ever joining a union, I am just not that interested nor entitled and certainly not as interested as those who are promoting passage of this legislation, who claim to be entitled.

9 comments for “C-377: A Better (but still problematic) Bill

  1. Peter Redmond
    December 12, 2012 at 11:23 am

    I agree with you 100%. As a person who has never belonged to a union, in fact even vehemently opposed the formation of two with former employers, it really is none of my business how or what a union does with its money. If those that pay the union dues have an issue with the way union leadership spends their money, then they will change the union leadership.

  2. Amanda Balcom
    December 12, 2012 at 11:26 am

    My father was a “Union” guy back in the 1970’s and ’80s, at a time when the unions were doing wonderful things for the workers such as obtaining good wages and negotiating benefits. The unions of today have lost sight of what they were set up to do back in those days, however, not being a member or a union, with no intention of ever joining a union, it does not matter to me what they do with their funds, nor do I care.

  3. Concerned union member
    December 12, 2012 at 12:03 pm

    It is great to see someone within the Conservative Party take a legitimate look at this from a perspective outside Mr Harpers. If I lived in your riding you would have my vote as I believe it took courage to write this blog. I am sure there will be dire consequences for this. Now if only MP’s were free to make an informed decision for them selves. I am sure there will be a “whipped vote” which puzzles me that in a free country with elected officials the our representatives may not be “FREE” to vote how they feel.

  4. Chris Mulhall
    December 12, 2012 at 12:21 pm

    As a dues paying union member, I was heartened to read your public views surrounding this private members bill. You seem to have the same understanding of it as I have. Thank you for your courage to say why this bill will not do anything but create division amongst working Canadians.

  5. Jon
    December 12, 2012 at 12:37 pm

    Has anyone ever looked at a CRA Charity filing? The details are quite sparse. No names, no addresses, no budget lines, just yes or no for questions and # of staff above a below a threshold. Why such a higher standard for labour organizations that must report provincially, and can be held accountable to labour boards my their members for fair duty of representation? Union’s are accountable every day to their members to fairly represent them under provincial law.

  6. Kevin Miller
    December 12, 2012 at 1:05 pm

    Although I am not a Conservative supporter, I want to offer my thanks as a citizen of Canada that you actually think through an issue before you in parliament and come up with a reasoned assessment as an MP. There are a handful of people in the House of Commons who seem to take their role as individuals elected to the House seriously.

  7. Tristan Freedman
    December 12, 2012 at 1:35 pm

    The public does have a right to know information about union finances because unions often try to organize workplaces. The people who are being asked to form a union in their workplace but are not yet union members have a right to know how that union spends its members dues as part of their decision making criteria.

    Further, in most circumstances while its a Canadian’s right to opt out of belonging to a union, all Canadian’s who work in a unionized setting have to pay union dues. The only right these Canadians have is to join the union and go to meetings – thats not much of a right at all to someone who doesn’t believe in the union they are forced to contribute their hard earned dollars to.

    Unions, like every other business, should have to send an invoice to each of their members and collect their own dues or fees. The fact that people are forced to finanically contribute to them whether they want to be a member or not is enough to warrant full public financial disclosure.

  8. Jonathan Sprung
    December 12, 2012 at 6:52 pm

    Thank you for your sanity. I do not support the Conservatives, nor did I ever have to deal with the party before this year. These laws of late that attack my livelihood, and that could easily publish my personal (and my family’s) information, are brutally overstepping my rights.

    This has motivated me, and many like me, to get politically involved. I joined the Liberal party, and now donate, and will be taking part in their local riding association. Thank you for introducing me to politics, if only to defeat your government.

    I know that you voted against it, and that you understand the issues, but to me that only two Conservatives voted against it, tells me that your party cannot listen to the average worker in Canada. I’d rather write to someone in your party that actually has common sense, yourself, because I don’t think the others listen or know anything about the law when they vote. I believe it may be too late for your party. I know your party will spend more money on attack ads in the coming months, and even more talking about the great things you believe you have done, but in my eyes, you’ve already lost the next election.

    Good luck, God bless.

  9. Christina
    December 13, 2012 at 9:05 am

    Thanks for this. I am a union member, and I expect accountability from my union to me and my fellow members, which is why I always participate in electing the officers who will represent me in collective bargaining. There’s no obligation to non-members.

    While we’re on opposite sides of the political spectrum, I appreciate independent thinkers of all partisan stripes. I appreciate that’s you’re putting thought into your votes rather than just mindlessly voting the party line.