The ultimate shake up for labor unions was introduced and passed in Wisconsin and Michigan a few years back. Now it’s rearing its head in Texas and Iowa.
The legislation being introduced alters the entire process that unions have leveraged for years to collect dues through payroll deductions. These payroll “protection” bills being pushed through state legislatures are aiming to eliminate the ability for unions to collect their dues, political contributions or sometimes both.
The threat is real and here’s why…
When payroll deduction is used, whether it’s for dues, retirement accounts or something else, there are a lot of processes that are bypassed. If unions lose payroll deductions, there is an inherent suggestion that unions must now build infrastructures to manage payments, membership and all of the data processing that comes with those activities. To add a cherry on top, not only do International or National unions need these infrastructures, but their local bargaining units need tools and processes as well.
Payments are only one piece of the pie
Yes, unions will need to collect member payments, but that is just the tip of the iceberg. In addition to asking the question ‘how are we going to collect payments?’, union leadership should also take into consideration the following:
- How are members going to sign up, and how are we going to simultaneously capture their information and payment data?
- How are we going to manage renewals?
- How are we going to update member and payment information when something changes?
- How will failed or past due payments be handled?
- What happens when a member has insufficient funds?
- Who on the team is going to absorb the accounting tasks such as creating general ledger entries and reconciling the funds with the bank?
- How will we be able to view who has paid, who hasn’t and the current status of members?
- When exceptions come through, who is going to handle them and how will they be handled?
- When our locals have questions about dues processes, members and payments, how are we going to support them?
There are many more questions that need to be asked within your union when ‘payroll protection’ is introduced, hopefully this is a starting point to get ahead of a potential crisis.