February 18, 2013

Taking another look at the controversy around Bill C-377

View from the Board | Bill Stewart

With Bill C-377, An Act To Amend the Income Tax Act (Labour Organizations) now in the Senate, it seems the controversy surrounding the legislation will continue.

The legislation initiated by South Surrey-Whiterock-Cloverdale MP Russ Hiebert, as a Private Members Bill and passed by the House of Commons in December 2012, requires all Canadian unions and labour organizations to file standardized financial reports with the Canada Revenue Agency.

The filings would then be publicly accessible on the internet similar to the requirements of any registered charity.

Bill Stewart

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View from the Board

Bill Stewart

While the howls of protest from labour leaders were predictable, the extreme arguments and tactics that they and their political allies used to stall and unsuccessfully defeat the bill were quite extraordinary.

One activist with an overactive imagination took his rant to YouTube and linked the legislation to railway boxcars filled with Holocaust victims destined to Nazi extermination camps.

In the all-party finance committee, the NDP’s labour critic exhausted all available time with a procedural filibuster that prevented any amendments – including those sought by organized labour – from being introduced.

In appearances before the finance committee, the national head of the Building Trades asserted that there were no non-union steamfitter-pipefitters in Canada.

The national vice-president of the carpenters union also indicated that his union annually collected and spent $250 million in union dues on training – an amount almost equivalent to the Northern Alberta Institute of Technology’s annual operating budget.

There was also a letter writing campaign warning MP’s that the legislation would prevent unionized construction workers from working on major energy and pipeline projects. As if this wasn’t scary enough, others suggested that the legislation would lead to the demise of Canada’s middle class. Really?

Indications are that the histrionic behaviour and rhetoric that permeated consideration of C-377 in the House of Commons will continue in the Senate.

So what are we really talking about?

All labour organizations will be required to publicly disclose financial statements, including the salaries paid to key officers and employees, the percentage of time spent on lobbying and political activities, and expenses over $5,000 that are unrelated to collective bargaining activity. Bill C-377 is not a unique concept.

It merely brings Canada’s laws in-line with those of other industrialized countries including Australia, New Zealand, Germany, France, the U.K, and the U.S. which has had transparency laws on the books since 1959.

As recent U.S. elections show, this hardly crippled the U.S. labour movement.

Bill C-377 will have no impact on the ability of unions to collect forced mandatory union dues and spend these dues as they see fit within the parameters of the law.

What it will do is allow union members, non-members required to pay dues and taxpayers to scrutinize that spending. For example, construction workers will know that their dues are being directly or indirectly sent to organizations seeking to prevent softwood lumber imports into the U.S. or to stop oilsands developments.

Taxpayers and members of the Manitoba carpenters union local that reportedly gave $10,000 to NDP MP Pat Martin (former carpenters union business agent and vocal opponent of Bill C-377) to help pay an out of court settlement arising from a defamation suit, would also see how tax supported dues are being spent.

Surveys repeatedly show that more than eight out of 10 working Canadians support the intent of Bill C-377.

The need for increased transparency is abundantly clear to just about everyone except certain union leaders and the politicians beholden to them. While union leaders will likely continue to hide from transparency, hopefully senators will see through the misinformation and pass this legislation.

Bill Stewart is the vice-president of the Merit Contractors Association in Alberta. Bill is also a member of the Journal of Commerce Editorial Advisory Board. Send comments or questions to

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