The Perks of Being a Union Executive

December 3, 2012

1)  The Perks of Being a Union Executive. We tend to pay a lot of attention to what teachers’ unions spend on politics, but even that lofty amount pales in comparison to what they what they spend on themselves. Like teaching, union work is a labor-intensive enterprise. Unlike teaching, the structure of union benefits resembles an inverted pyramid, where a lot of people receive similar perks and only the lowest level employees receive standard workplace accommodations.

Wage amounts are usually public record, but are perilously difficult to pin down. What a union executive makes can be inflated in the record by sick leave accrual or severance payouts, or can be understated because of tax deferments or allowances in lieu of pay. Still, with that caveat in place, an examination of 2010-11 tax records reveals wages of the highest paid employees of the National Education Association and its state affiliates – defined here as the money reported in box 1 of a W-2 form – ranged from almost $540,000 down to less than $92,000.

Financial records also show that certain perks are common among NEA and state affiliate executives, while others are controversial even in the corporate world.

Housing allowances are prevalent. Union officers often will receive a cash payment to cover the costs of maintaining a home near union headquarters, usually located in the state capital. Some affiliates actually provide a home. Which officers receive a housing allowance and for how much varies from state to state, but it ranges from 20 percent of salary all the way down to $800 per month.

One would expect the union to cover the costs of executive travel, but some affiliates allow first-class travel and many also reimburse for the cost of companion travel – in one case up to $2,000 per year. Unions have been known to reimburse officers for home, pet and garden care while they are away on business, although it isn’t known whether these kinds of perks have survived recent budget shortfalls. Auto allowances and gas cards are also common.

A growing number of officers receive payment for annual health or social club dues and initiation fees, with one affiliate offering up to $1,000 a year in “wellness-related expenses.” A handful of affiliates also provide the president with a discretionary spending account or clothing allowances.

Accounting for these varied forms of compensation can get complicated, so some unions provide free tax preparation. At least one affiliate even offers relief if a union officer’s accumulation of previously deferred payments or leave buy-outs leads to higher tax obligations – in the form of the “gross-up” payment.

If you are unfamiliar with the term, that’s when the employer picks up the tab for the additional tax the employee will have to pay for a unusually large lump sum payment. Of course, the “gross-up” payment itself is taxable, so it is often made large enough to help cover that extra tax as well. The practice has come under fire in corporate America, so it’s ironic to see it turn up in a union.

Since much of this alternative compensation is hidden, it will be difficult to discern how much it will be affected by membership losses and budget cuts. When revenues can’t cover payroll, union staffers are laid off. But executive officers are elected. Some have accepted pay freezes, but I haven’t heard any talk of rolling back these kinds of benefits. If done, it will be done quietly, so as not to alert the rank-and-file to their existence in the first place.

2)  Last Week’s Intercepts. EIA’s blog, Intercepts, covered these topics from November 27-December 3:

*  Graduation Stats Show Equality and Inequality. Racial gaps persist, but some states have equally bad stats across all groups.

School Districts Ride CABs to the Poorhouse. Next big idea: payday loans!

Tryptophan Coma at the New York Times. Thomas Friedman wasn’t the only one with goofy Cabinet suggestions.

NEA Affiliate Staff Updates. Contract settlements are not always good news.

Detroit President Re-Elected; Miami President Won’t Run Again. Apathy still in front.

3)  Quote of the Week. “There’s a lot of cynicism in labor about the capacity of ordinary, working-class people to run their unions. Leaders think those people should have good lives, but they don’t think they have the capacity to do big things. Even among ‘progressive’ unions, democracy is not high on the list of must-haves. That has really hurt our movement.” – Mark Brenner, director of the pro-union publication Labor Notes. (November 30 In These Times)

Important Message for E-Mail Subscribers

November 26, 2012

1)  Important Message for E-Mail Subscribers. For more than 15 years I have been distributing the weekly EIA Communiqué using 1997 methods – bulk e-mail from a list maintained by hand. This required a lot of list maintenance on my part and sometimes difficult dealings with AOL and its spam restrictions. It got to the point where I stopped recruiting new e-mail subscribers in the hope new readers would instead migrate to the daily blog.

Happily I have managed to cut the Gordian knot. With EIA’s recently updated web site and some techno-maneuvering, it is now possible for me to disseminate the weekly communiqué via the automatic e-mail service provided by Feedburner. This will expand the content possibilities for the e-mail newsletter while greatly reducing the time I spend administering the list.

It will, however, require one bit of action on your part. Sometime before the next communiqué appears on Monday, December 3, each current e-mail subscriber will receive an e-mail from Feedburner with “Education Intelligence Agency” or “EIA Communiqué” in the subject line. In the body of the e-mail will be an embedded link for you to click, or cut and paste into your web browser’s URL address window.

Click the link and you will verify your subscription and continue to receive the newsletter via e-mail as usual – once a week, no more and no less.

Don’t click the link and you will be unsubscribed from future e-mail communiqués.

This verification measure is a bit of a pain, but necessary to ensure that each subscriber has asked to be placed on the list. Otherwise Feedburner and similar services would be overrun with spammers and useless for the rest of us.

If you don’t receive your Feedburner e-mail by next Monday, check your spam filter and/or contact me at mike@eiaonline.com.

If you prefer, you will be able to subscribe to the newsletter’s RSS feed, or simply visit the Communiqués page on the web site.

Thanks for helping out with this housekeeping. Next week we’ll return to news.

2)  Last Week’s Intercepts. EIA’s blog, Intercepts, covered these topics from November 20-26:

*  Crimson vs. Indigo. Multiple experiments in one-party rule.

WEAC Looking for New Direction. The Peterson Plan.

Hawaii Teachers “Work to Rule.” Next best thing to a strike.

Black Friday 1940. The scariest day of the year.

Happy Thanksgiving, Everyone! Bridging the gaps.

3)  Quote of the Week. “I don’t think they should sit on the sidelines. I think they should do what they do when they give to the Lyric Opera. They don’t go to the Lyric Opera, give money and then tell the singers how to sing. Give your money and walk away, buddies.” – Karen Lewis, president of the Chicago Teachers Union, when asked what the backers of Mayor Emanuel’s school reform agenda should do. (November 20 Chicago Sun-Times)

Um, they may not tell the singers how to sing, but they have a big say in what they sing, don’t they?

Will Marching Against Poverty Restore NEA’s Bottom Line?

November 19, 2012

1) Will Marching Against Poverty Restore NEA’s Bottom Line? The National Education Association is looking for a way out of a bind. As it proved once again this year, NEA’s main avenue of success is its ability to win elections through the massive application of committed activists and cold cash. Its problem is that political defeats are costly, but victories are often only temporarily beneficial. The 2008 elections did lead to stimulus packages and edujobs bills, but they also led to the worst four-year membership losses in NEA’s long existence. So while favorable results at the ballot box in 2012 are helpful, they don’t guarantee smooth sailing ahead for the union.

The Occupy movement, the Wisconsin protests, the Chicago teacher strike and the 2012 voter turnout, combined with the accession of John Stocks as NEA’s executive director, have led the union’s officers to adopt an approach they believe will establish NEA not only as a powerful labor union, but as a leader in the broader realm of social issues.

Stocks unveiled this move with his “social justice patriot” speech at the NEA representative assembly last July, but it didn’t start there:

Never in the history of our nation have public schools been under such relentless attack. Never in the history of teacher unionism has there been a greater urgency to rethink strategy.

To meet these challenges, our public schools and our teacher unions should set two key goals: survival and justice. Furthermore, these goals are inextricably linked. Our system of public education and our teacher unions will not survive unless they more forthrightly address issues of social justice.

Those words didn’t come from John Stocks in 2012; they came from Bob Peterson, now the president of the Milwaukee Teachers Education Association, in 1999. Peterson was, and is, a proponent of the concept of “social justice unionism,” which he described as “part of a broader movement for social progress rather than merely focused on narrow self-interest.” Stocks spent much of his career in Wisconsin and appears to want to apply these themes nationally.

The value of social justice unionism as a philosophy is a matter for academics. I am only interested in its practical application for a union that needs to increase membership and ameliorate budget deficits. We already have a few clues about how this will work.

For one thing, NEA is trying to get out of the business of simply providing cash grants to friendly organizations and will insist on joint efforts in exchange for financial support. Additionally the union will hold a “dialogue on social justice” next month. This is to have the dual goal of placing NEA firmly in the civil rights picture while activating minority members in the union ranks.

The long-term strategy is to recruit new members and increase the participation of existing members through social justice issues. In fact, NEA organizers have been told to stop emphasizing the union’s services, liability insurance and workplace protections and instead focus on “core values.”

A large number of NEA staffers have been reassigned to training state and local officers in organizing – a skill some have let atrophy during the decades of booming enrollment and teacher hiring. While overall staffing levels will require political work in state legislatures, NEA plans to seek out new markets in charter and online schools, early childhood education workers, and members of non-union teacher organizations.

It’s important to note that these are NEA’s plans. They face a number of obstacles internally, regardless of whether outsiders put up a fight. First, NEA’s devotion to social justice unionism does not necessarily mean it will be embraced wholeheartedly in all of its state affiliates. Changes of direction are relatively easy to map out in a DC conference room, but notoriously difficult to implement among state and local officers with agendas of their own. Ask Bob Chase.

Second, organizing a union of 3 million members around social issues may be a winning strategy as long as those issues are general and amorphous. Protecting the working class, equal rights for all, affordable health care and reducing poverty will generate widespread support. But if the specifics turn out to be in service of a narrow liberal political worldview, it will have no more success than NEA’s current strategy, and might in fact play into the hands of the union’s political opponents.

Third, positioning NEA as one of the leaders of a mass movement opens the door for other organizations to take up the “self-interest” mantle. Members might prefer a union that spends its time negotiating contracts instead of heightening climate change awareness.

NEA believes that stressing its broad social justice principles will improve its self-interests. It’s nice when those things coincide. We’ll see which one the union chooses if they don’t.

2) Last Week’s Intercepts. EIA’s blog, Intercepts, covered these topics from November 13-19:

Election Win for Charters Is Only the First Hurdle. First the ballot box, then the courtroom.

The Wrath of Conn. Will Detroit make Chicago look like Topeka?

Back to Reality. Union organizing isn’t what it used to be.

Technology Marches On. Changes to the EIA web site, and perhaps to this e-mail newsletter as well. Stand by for more.

Summary of NYSUT’s Campaign Financing. How do I elect thee? Let me count the ways.

3) Quote of the Week. “President Obama not only won this election, but so did his ideas and his values. The American people want fairness. They want everyone to pay their fair share…. But what we also have to do is to make sure that the corporations who earn billions of dollars pay some tax, and now they’re paying none.” – Dennis Van Roekel, president of the National Education Association, a $1.6 billion tax-exempt organization. (November 13 PBS NewsHour)

Five of Eight Largest Teacher Union Locals Had Budget Deficits

November 12, 2012

1)  Five of Eight Largest Teacher Union Locals Had Budget Deficits. An Education Intelligence Agency analysis of 2010-11 Internal Revenue Service filings reveals five of the eight largest teacher union local affiliates in the nation operated with budget deficits. Half of the 36 largest locals saw their dues revenue decrease from the previous year.

Most of these locals are either affiliates of the American Federation of Teachers, or jointly affiliated with AFT and the National Education Association. AFT’s governance structure is largely centered on its locals, just as NEA’s is centered on its state affiliates, which had their own financial troubles. The largest teachers’ union local in the U.S., the United Federation of Teachers in New York City, accumulated dues revenue of $125.5 million in 2010-11, but still ran an $11.8 million deficit due to a 12.1% increase in employee compensation costs.

The United Teachers Los Angeles, United Teachers of Dade, Broward Teachers Union, and United Educators of San Francisco were the other four top locals to experience deficits.

Other locals may have been in the black but are still on shaky ground. Figures for the Washington Teachers Union for 2010-11 were unavailable, while the Detroit Federation of Teachers’ small surplus did not cover the $1.4 million it still owed AFT.

Just like NEA’s state affiliates, a number of locals were able to achieve pension liability relief to improve their bottom lines. But high personnel costs continue to worry many locals.

EIA has posted a table on its web site listing the dues revenue of the 36 largest locals, along with their other revenues, number of employees, their total compensation, and their budget deficit status.

2)  Last Week’s Intercepts. EIA’s blog, Intercepts, covered these topics from November 6-12:

Teachers’ Unions Win a Defensive Victory. Four more years.

Gravy Train Drying Up for NEA’s Favorite Advocacy Groups? Play for pay.

Heading for the Hills in California. The two states of California, but one is a permanent minority.

Call Me Maybe. Two-way spam?

Eat Your Vegetables! Voting scolds.

3)  Quote of the Week. “We have the capacity to rebuild this state.” – Dean Vogel, president of the California Teachers Association, commenting on the results of Tuesday’s election. (November 8 Reuters)