JOC ARCHIVES

November 7, 2012

B.C. Liberals discuss union financial disclosure measures

A B.C. labour leader is extremely critical of the local open shop contractors association for backing two policy measures proposed by the B.C. Liberal Party, which call on the provincial government to force public sector unions to disclose their finances.

“The ICBA’s (Independent Contractors and Businesses Association) definition of free enterprise has become very tarnished,” said Tom Sigurdson, the executive director of the British Columbia Yukon Territory Building and Construction Trades Council. “The ICBA want to be able to contribute to political parties and advance their own political agenda, but they want to restrict how unions contribute to political parties to advance the union’s agenda. If this is so good, the ICBA should do the same and lead by example.”

Late last month at the B.C. Liberal convention, delegates voted to pass two motions that aim to change the way unions handle their finances.

The first motion would require the disclosure of public sector unions’ annual financial reports with the objective of increasing transparency and accountability within labour unions.

The second motion proposed to limit the ability of unions to use compulsory dues for political purposes.

The president of the ICBA, Philip Hochstein, strongly supports the two proposed policy measures, which were passed by delegates at the convention with little opposition or debate.

“I think that the passing of a motion to deal with transparency mirrors what is going on in Ottawa,” said Hochstein.

“Unions have special status because the dues they collect are exempt from tax. This means they have an added responsibility to the tax-paying public to be transparent. If unions have nothing to hide, then they should just comply.”

The motions are similar to proposed federal Bill C-317, which would require all Canadian labour unions to publicly disclose their financial statements or risk losing their tax exempt status.

“There is no reason to limit this policy to the public sector because the same issue can be applied to all unions,” said Hochstein.

The federal proposal to amend the Income Tax Act was introduced as a Private Member’s Bill on Oct 3, 2011, by Russel Hiebert.

He is a backbench Conservative MP for South Surrey, White Rock and Cloverdale, B.C.

“The unions have special status because they can take money off of people’s pay cheque, which is something no one else can do except the government,” said Hochstein.

“The unions were granted this privilege under the Rand Formula for the purpose of collective bargaining. No one intended the unions to get involved in political issues.”

At the federal level, Merit Canada supports the argument that a union’s tax exempt status is similar to a charity.

For this reason, unions should also be required to file a standard set of financials that are made available to the general public.

In addition, it is argued that union members pay their dues for collective bargaining purposes, not to pay for the battles of union bosses or to finance a political agenda.

“The unions should be involved in public debate, but not with mandatory dues,” said Hochstein.

“Money for these activities must be collected separately. They must limit the collection of dues to collective bargaining or allow dues to be collected on a voluntary basis.”

In response, Sigurdson argued that union members elect a leadership to make decisions on how money is spent.

This is similar to many other organizations including the ICBA and the federal government. However, membership fees for ICBA member companies are not tax deductible.

In fact, union members have the right to access the financials of their own union.

The question is whether or not this information should be made available to the general public.

For this reason, Sigurdson said unions have the right to spend money any way they like once that decision goes through a democratic process.

This includes union members voting to use some of the money collected from dues for political purposes.

For Sigurdson, the two proposed motions are just another example of the B.C. Liberal Party attacking the labour movement and the B.C. New Democratic Party.

“The liberal party has a very right wing agenda,” said Sigurdson. “In the last 12 years, they have done everything they can to inflict maximum damage on working people in the province and Hochstein has been a staunch supporter.”

The outcome of the policy debate at the B.C. Liberal convention will be forwarded to the government and cabinet, who will decide what action to take in terms of enacting new legislation.

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