State of the Unions

Published September 1, 2006

Paycheck Protection in the Balance

Lawsuits challenging the constitutionality of “paycheck protection” are gaining national attention.

Following a ruling from Washington state’s supreme court permitting the union to spend dues on politics without members’ permission, Washington state’s attorney general and the National Right to Work Legal Defense Foundation in June appealed to the U.S. Supreme Court. See for complete coverage.

Utah’s ban on political payroll deductions is also in limbo. In May the state’s highest court struck down as unconstitutional a law forbidding unions to spend members’ dues on political donations. In June the state’s attorney general, supported by a number of free-market organizations, appealed to the Tenth U.S. Circuit Court of Appeals.

Source: “Union Can Use Dues for Politics: Court,”

Federal Financial Reports Apply to Union Affiliates

In August, the D.C. Circuit Court of Appeals said the U.S. Department of Labor may require state affiliates of national unions to comply with federal financial reporting regulations. The reports will help state employees hold their unions accountable in jurisdictions that do not already have such regulations.

Source: The Appeals Court opinion is available online at

NEA Benefits from Teacher Perks

Los Angeles Times reporter Kathy M. Kristof revealed the National Education Association collected nearly $50 million in 2004 for pushing underperforming annuities, life insurance, and other financial products on its 2.7 million members.

The New York teachers’ union was investigated by that state’s attorney general for covering up a similar program and agreed to a settlement in June. The agreement includes more transparency in the marketing of financial products.

New York State United Teachers received $3 million a year for endorsing annuities that carried fees and expenses nearly three times higher than the cost of many popular competing investments. The union allegedly tried to conceal from its members an arrangement with ING Group to sell the annuities.

Sources: “Unions’ Advice Is Failing Teachers,”,0,5019831.story?coll=la-headlines-business; “New York Teachers Union Settles Retirement Probe,”

Unions Losing Ratification Elections

March and April 2006 were dreadful months for union growth. In March, the National Labor Relations Board conducted only 139 representation elections–fewer than the average of 151 for the previous five months. In April, only 128 elections were held, and unions won only 60 percent of them. April also saw unions lose 19 of 25 decertification elections.

Sources: “The National Labor Relations Board Election Results,”; “The National Labor Relations Board Election Report, Six Month Summary,”

You Won’t Learn This from the Teachers’ Union

The Independence Institute has unveiled a new Web page chronicling the Colorado Education Association’s (CEA) reported campaign spending in the 2006 election cycle. The page will be updated throughout the election season as new campaign finance reports come in. Union members can see how their dues are being used politically and find other information not on the CEA’s Web site.


Nocturnal Union Bosses

In the darkness of closed negotiation sessions, outrageous demands by union officials remain hidden from the public, according to recent reports. In “Let the Public In” and “A Culture of Complaint,” the Hoover Institution concluded collective bargaining is taking public education in an unsustainable direction. The system can be fixed, the reports say, by applying to collective bargaining negotiations the same “sunshine” laws that apply to other public business.

In “Strike Phobia: School boards need to drive a harder bargain,” the American Enterprise Institute and Brookings Institution contend, “While productive negotiations require the confidence to float ideas without fear that they will appear in tomorrow’s headlines, greater transparency would force both the union and management to justify their demands in the face of public scrutiny.”

Sources: “Let the Public In,”; “A Culture of Complaint,”; “Strike Phobia: School boards need to drive a harder bargain,”,pubID.24439/pub_detail.asp

Plugging the School Drain

In “Stopping School Corruption: A Manual for Taxpayers,” the Yankee Institute explains, “School boards and administrators usually claim that 75 to 80 percent of their budget represents ‘fixed costs.’ Taxpayers should never accept such a statement because this is the biggest deceit of all. Such a statement assumes every school employee is essential, no consolidations can take place, all programs and services are efficient and effective, all resources are managed with quality guidelines, and every option is managed with utmost efficiency.”

Source: “Stopping School Corruption: A Manual for Taxpayers,”

Will Courts Mandate School Choice?

A novel class-action lawsuit was filed in July in New Jersey by Education Excellence for Everyone (E3) and the Alliance for School Choice on behalf of 12 children attending chronically failing public schools. The plaintiffs and their parents are seeking the right to leave their failing schools–taking their per-pupil state funding with them–and find a better education in successful public or private schools.

The named plaintiffs of the suit, Crawford v. Davy, represent more than 60,000 students attending 96 schools in 25 public school districts in 16 New Jersey counties.

Source: E3’s Web site,

Wage Policies Hurt Workers

In “The Negative Effects of the Minimum Wage,” the National Center for Policy Analysis notes labor union officials are the main proponents of minimum and prevailing wage policies, which increase unemployment, reduce benefits and competition, and hurt low-wage earners.

Source: “The Negative Effects of the Minimum Wage,”

Ryan Bedford ([email protected]) is a labor analyst with the Evergreen Freedom Foundation in Olympia, Washington.