Even a quick review of the latest LM-2 and IRS 990 reports filed by unions reveals that some federal sector unions have a lot of money in the bank at not just the national level, but also at the council and local level. We are talking millions and tens of millions. We applaud the political and investment skills it must have taken to generate these assets from dues and other sources. But, unions should not be blind to the fact that fat investments accounts year-after-year are only begging for agencies to use those unspent nest eggs against unions when they propose agencies pay the expense of their official time, travel and per diem costs.

After all, take a union entity that is sitting on that kind of a cushion and that is also the level of the union with which an agency must bargain, whether that be national, local or intermediary. Why should an agency not respond that a union pay its own costs or a substantial share of its costs rather than ask for a piece of the federal budget? And it goes without saying that pudgy asset figures, especially liquid assets in excess of what a union might need to weather some reasonable calamity, are only making it easy for some anti-union Congressional delegate to grandstand his/her way into some legislation which makes it tougher on all unions. Do the names Price, Ross, Chaffetz, Meadows, and Issa help clarify the liability? A third vulnerability is the federal employee in agencies who does not want to see one of these overstuffed unions get exclusive recognition in his/her agency. How easy would it be for one of those feds to mount an anti-union vote around a union’s mega-wealth—or even stir up a storm on social media? Oh so easy. And do not even get us started on union whistleblowers.

Obviously, there are a few ways for unions to reduce this risk. First, they could cut their dues rate for some or all of their members, removing that annual surplus that keeps piling up. Second, they could distribute dues refunds to members. Third, they could spend down the overflowing cash pots by plowing the money into membership building, e.g., bigger incentives, better targeted communications, more staff recruiters, etc. Other spending options include boosting staff compensation and benefits, buying real estate, or covering the costs for locals to attend conferences.

There is nothing wrong with unions amassing wealth. But they should not make the mistake of assuming they can do that endlessly without some consequences. This is another one of those places in our universe where for every action there is an equal and opposite reaction heading your way.


About AdminUN

FEDSMILL staff has over 40 years of federal sector labor relations experience on the union as well as management side of the table and even some time as a neutral.
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