November 21, 2012
CLAC wants Bill C-377 redrafted
The Christian Labour Association of Canada (CLAC) is calling on the federal government to withdraw and redraft Bill C-377 because the proposed legislation violates Canadian privacy laws and the Charter of Rights and Freedoms.
“We think the federal government should take this private members bill and undertake a proper and thorough vetting,” said Dick Heinen, executive director of CLAC.
“The bill could be passed, but it won’t pass the test of privacy issues and fair disclosure or the administrative bureaucracy it would create. Not enough work has been done to make sure this is the right approach to transparency.”
Russel Hiebert, a backbench Conservative MP for South Surrey, White Rock and Cloverdale, B.C. introduced a Private Member’s Bill entitled An Act to Amend the Income Tax Act on Oct 3, 2011.
Bill C-377 will require unions to file details on any transaction of more than $5,000 with the Canada Revenue Agency, which will then be posted publicly on their website.
This means that the general public would be given access to the detailed financial statements of every local union, including assets, liabilities, expenses and salaries.
“We are in support of transparency,” said Heinen.
“We take issue with the form the bill takes, which is an invasion of privacy. It would release information that does not belong in the public domain. This is good information for our members, but not the public.”
Bill C-377 is based on the argument that unions should be subject to a higher degree of public accountability, because labour organizations are tax exempt under the Income Tax Act and their members’ dues are tax deductible.
“If you take a look at the levels of disclosure for charities, you will see requirements for unions are far more rigorous,” said Heinen.
Under the proposed legislation, the names of anyone receiving money from the unions for any reason, such as a pension, training, health care or venders providing services, would have to be publicly disclosed or the union would risk losing its tax exempt status.
Privacy Commissioner of Canada Jennifer Stoddart raised serious concerns about the constitutionality of the legislation, which she explained to the House of Commons Standing Committee on Finance on Nov. 7.
“Bill C-377 aims to increase transparency and accountability of unions vis-à-vis their members by requiring detailed disclosure of salaries and other individualized expenses through online posting,” she said.
“However, the bill goes much further than that by requiring such disclosures also be made to the public at large, which in my respectful opinion, oversteps what is needed to achieve its stated objective.”
Stoddart said the bill would infringe on the private rights of individuals by forcing unions to publicly disclose salaries, as the union is only required to provide this information to their members. According to Stoddart, it is not clear that the names, salaries and expenditures of more than $5,000 for all union employees and contractors need to be publicly disclosed to achieve the bill’s stated objective.
“I believe that limiting the scope of the bill such that public disclosure requirements apply to a much smaller subset of individuals, or requiring only aggregate level reporting, would result in a more balanced, yet equally effective outcome,” she said.
For example, registered charities in Canada are required to publicly disclose only high-level salary information for their 10 highest-compensated positions.
But even then, only the numbers of positions within specified salary ranges are disclosed, without identifying the individuals.
A similar type of qualified public reporting requirement could potentially be applied to labour organizations.
“At the international level, countries such as the United Kingdom and Australia have taken a similarly limited approach to union transparency when it comes to personal information, publicly disclosing the salaries of only a select few top union officials,” said Stoddart. “These countries would seem to provide a more privacy-protective template from which to work.”
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