May 6, 2013
Federal legislation rankles unions, but pleases open shop
If a divisive bill forcing Canadian labour unions to make public their finances and activities gets through the Senate and into law, expect a court challenge, says the second-in-command at the Canadian Labour Congress (CLC).
Bill C-377 is first and foremost a move backed by Merit Canada and other open shop organizations to destroy unions, said Hassan Yussuff, the CLC’s secretary-treasurer.
“It has little to do with transparency and more to do with ideology,” he said.
The bill, which was passed by the House of Commons last December, would amend the Income Tax Act as it pertains to labour organizations.
The contentious part of the bill is that unions will have to give the Canada Revenue Agency (CRA) details of all transactions of $5,000 or more that are unrelated to bargaining, plus salaries and benefits of senior union officials, as well as detailed breakdowns of spending on political and lobbying activities.
That information would be publicly posted on the CRA’s website.
Supporters of the legislation say Bill C-377 will bring Canadian unions in line with other countries, such as the U.S., U.K., Germany, France and Australia, where under law, trade unions provide detailed public disclosure of their financial activities.
“The least we can ask is for unions to be open and transparent,” said Terrance Oakey, president of Merit Canada.
“There are lots of organizations that have public reporting requirements. Labour organizations have none in Canada.”
Merit represents about 3,500 open-shop contractors in all provinces except Quebec and P.E.I.
Not long after Conservative MP Russ Hiebert, who represents South Surrey-White Rock-Cloverdale, introduced his private member’s bill, Merit launched its “Why is Big Labour Afraid of the Light?” campaign.
Oakey said that unions have large “nest eggs,” which are used to advance political objectives, some of which are not supported by union members.
“I don’t think union money should be used to pay for radical causes, like the Quebec student protests,” Oakey said from Ottawa.
And, construction workers have a right to know if their union funds anti-oilsands campaigns, he added.
But, not all employees have the ability to find out what a union is doing, Oakey said.
Employees in a union shop, who are not union members, but who must pay union dues, don’t have access to financial information, he said.
Bill C-377 will make that information public.
Yussuff argued that unions are private organizations and that the general public has no right to be privy to where union money is spent.
“Members are entitled to that information. Current laws already provide for that,” he said.
Making union expenditures public on the CRA website is akin to Pepsi-Cola revealing their marketing strategies to Coca-Cola, Yussuff said from Ottawa.
When a union is trying to organize a workplace, information about relevant expenditures would be posted, which would give open shop organizations like Merit key information, he said.
Also, building and maintaining the reporting system will be costly for the CRA, which while having its workforce cut, won’t generate any revenue from this new reporting requirement, Yussuff added.
The CRA has said it could take up to 2015 before its ready to enforce the bill, with set-up costs at $2 million to $3 million, in addition to ongoing expenses.
About 25,000 CLC locals would submit reports to the CRA, said Yussuff, who started his union career in an auto parts factory in Toronto.
Oakey, who prior to becoming Merit president two years ago, was a former Parliament Hill Conservative staffer and lobbyist, doesn’t think costs will be as high, given that basic accounting software doesn’t cost millions of dollars.
Another wedge is that this bill violates privacy laws because it will identify individuals making expenditures over $5,000, Yussuff said.
The Canadian Bar Association also warned that the bill might violate the Charter of Rights’ protections of freedom of association and expression.
But, Oakey isn’t worried.
Canada’s Attorney General, MP Rob Nicholson, a lawyer, voted in favour of Bill C-377, so any concerns likely aren’t warranted.
In February, Tory Senator Hugh Segal voiced his concerns about Bill C-377.
“Dispatching CRA to police how trade unions spend their money, in denominations of $5,000 or more, is to increase the role of CRA and of the state in ways that create a bigger, nosier and more expensive government,” Segal said during a Senate debate.
“This bill is about a nanny state. It has an anti-labour bias running rampant and it diminishes the imperative of free speech, freedom of assembly and free collective bargaining.
“I imagine that, were it to pass, subsequent legislation from private members might be aimed at newspapers; networks, TV and otherwise; student groups; universities; junior baseball leagues; and even, God forbid, community soccer.”
Despite being passed in the House of Commons, Bill C-377 is still before the senate.
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