United Steelworkers threaten to withhold dues from OFL

Union raises concerns, distances itself from federation
By Liz Foster
|Canadian Labour Reporter|Last Updated: 11/03/2014

THE ONTARIO Federation of Labour's finances are causing frustration among some of the province's labour leaders.

On Oct. 20, the United Steelworkers (USW) announced plans to withhold its dues — and potentially withdraw altogether — from the Ontario Federation of Labour (OFL).

"We have serious concerns about the
current financial situation," said Tony De Paulo, USW’s assistant to the director. "The Steelworkers, along with other unions, have expressed our concerns. We’ve indicated that if the current situation is not resolved as soon as possible, we’ll probably put our dues in escrow until the matter is resolved."

The OFL — Canada’s largest provincial labour federation — represents 54 unions and as many as one million Ontario workers.

Following news of the USW’s plans, the OFL announced it had issued layoff notices to about one-third of its paid employees.

According to Steven Staples, an OFL spokesperson, the organization issued the layoff notices in accordance with its collective agreement. He said the layoffs would not take effect for another four months, and in some cases even longer.

"Any kind of loss of revenue undoubtedly will affect staffing levels at the organization," Staples said. "Based on the notification the OFL received, I think it’s prudent on the organization to hope for the best but prepare for the worst."

Staples said the OFL was working hard in an attempt to avoid as many layoffs as possible — if not altogether.

Last year, BDO Canada LLP — an independent auditing and accounting firm — raised concerns about the OFL’s finances. The group’s operational deficit was determined to be $651,203 in the 2012 fiscal year, causing cumulative liabilities to exceed assets by nearly $6 million.

However, Staples said BDO examined the organization’s finances over a year-long period and ultimately issued a clean bill of health.

The resulting report found the OFL had not borrowed to cover spending and was not spending more cash than it generated. A large portion of the deficit was found to be related to the OFL's pension and benefit requirements, which generate future funding obligations, not current obligations.

But some labour leaders remain skeptical.

Along with representatives from four other unions — including the Elementary Teachers' Federation of Ontario — Warren (Smokey) Thomas, president of the Ontario Public Service Employees' Union (OPSEU), signed a letter requesting a meeting with Hassan Yussuff of the Canadian Labour Congress in regards to the OFL and its current financial situation.

"One meeting with the president of the Canadian Labour Congress isn't going to fix things, but it'd be a good start," Thomas said. "I think Hassan can do it. I think he's up to the task."

The letter, dated Oct. 20, coincided with the USW's announcement it plans to withhold dues from the OFL until its concerns about the organization's financial situation are addressed.

"We (OPSEU) left the OFL about three years ago," Thomas said. "And the reason we left is we had tried, and failed, to implement structural changes."

At the time, Thomas said, he clashed with OFL president Sid Ryan in his attempts to implement financial accountability as well as policies and procedures relating to elected officials.

"I look forward to the day we can go back," he said of the OFL. "But I don’t know when that day is coming. My organization will not go back as long as Sid Ryan is president. We lost confidence in his leadership abilities and we will not go back until the organization has changed. I’m not the only person that feels that way, though I can only speak for my organization."

In signing the letter and requesting a meeting with Yussuff, Thomas said, he hopes that OPSEU can play a part in bringing about meaningful change within the OFL.

"The more unions say there are concerns, and put their concerns in writing, and express their concerns to the CLC, it makes me a little more hopeful we can get a table together and start to make the necessary changes," Thomas said. "I remain cautiously optimistic."

Thomas said the ultimate hope was for the CLC to undertake an independent review of the OFL and determine what needs to be updated or rebuilt. Until such a time, he said, the OFL will continue to flounder.

"On a personal level, I really would like to be back. But not as long as Sid’s there, and not as long as there are no rules. I work for the people that pay dues to my union and I take that job very seriously. I’m not going to spend their money when I don’t think they’re getting good value for it," Thomas said. "It’s the right thing to stay away ‘till it’s fixed."

Staples, however, said strong affiliation with the OFL is necessary for a strong, united labour movement in Ontario.

He said affiliation with the OFL allows unions to participate in discussions about important issues affecting workers, such as pensions, health and safety, compensation and labour law reform.

Being a part of the organization gives unions access to all of the OFL’s resources, Staples said, as well as the strength of voice of nearly one million members.

And while Staples said — to his knowledge — no meeting with the CLC has been finalized, the OFL would gladly take part in any attempts to strengthen the labour movement in Ontario.

"If there weren’t an OFL today, we’d be out there talking about how to create one," Staples said. "It’s an essential part of the Ontario labour movement."

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