Why and how philanthropy can better support labor organizing

Written by: Ryan Schlegel

Date: September 01, 2016

As labor union membership has declined dramatically over the last several decades, economic inequality has risen, and the American working class has been increasingly less protected from economic storms by the bulwark of organized labor. This Labor Day, in a year when social and economic ties seemed to have frayed up and down the income scale, foundations and high net worth donors interested in economic justice need to recommit to supporting a robust, responsive labor movement – especially by funding labor organizing and grantee collaboration with labor unions.

Labor union membership has historically been a ticket to the middle class for American workers. Since the 1960s, though, powerful corporate interests have capitalized on a conservative political resurgence to push anti-union policies at the state and federal levels – and they’ve won. Combined with deindustrialization across large swaths of the country and barriers to organizing workers in the service industries, this anti-labor revolution has decimated union membership and dramatically tipped the scales of power away from working people.

This movement away from organized labor spells trouble for many of the trends foundations and their grantees care about. While national wage stagnation, gaping inequality and household financial instability are perhaps not caused solely by the decline in union membership, it appears to be a significant contributor to these troubling trends. A recent Economic Policy Institute analysis of the decades-long labor union membership decline found that wages for nonunion workers would have been 5 percent higher in 2013 if union density had remained at 1979 levels. The downward pressure declining union density exerts on nonunion workers appears significantly worse for those with less educational attainment.

These issues demand organized, grassroots-driven solutions that require a strong labor movement to articulate and win. Here are some ways that foundations and wealthy donors who care about the economic well-being of low- and middle-income Americans can help boost the power of organized working people to affect change.

  1. Explore and encourage collaboration between their grantees working for economic justice and organized labor, including funding labor organizing efforts when appropriate. Foundation funding from community and public foundations must abide by generous limits set by tax law when they fund lobbying activities like those undertaken by many labor unions.Private foundations’ work with labor unions is more tightly controlled by prohibitions on private funding for lobbying. For this reason, foundations and donors may operate under the false assumption that working with or funding labor unions is forbidden.But this is precisely why fostering partnerships around shared goals between grantees and unions is so crucial: community organizations (501(c)(3)s) and labor unions (501(c)(5)s) each have a role to play in movements for economic justice, and both are stronger and more successful when they work in tandem.Additionally, workers centers and sector-wide alliances like the National Domestic Workers Alliance and the National Day Laborer Organizing Network (both 501(c)(3)s) are two examples of the potential in foundation funding directed toward labor organizing and union collaboration.
  2. Increase funding for labor organizing.  According to Foundation Center data, since 2003 only 4 percent of all funding for employment – including job creation, retention, training, counseling and benefits – for poor people was dedicated to organized labor. Of these dollars – about $100 million total – nearly a third came from a just one funder: the Ford Foundation.If the top five funders of employment for poor people (of which Ford is one) made a commitment to funding organized labor on par with Ford’s – about 10 percent of their employment dollars – investments in organized labor could increase by 30 percent over the next three years.Foundations that prioritize work to secure employment, benefits and job training for poor people without also prioritizing organized labor undercut their own investments. Any gains secured by foundation investments in working people’s economic wellbeing without organizing those workers are insecure.
  3. Build relationships with others in philanthropy and the labor movement. The Neighborhood Funders Group’s Funders for a Just Economy working group understands the importance of an integrated approach to improving the lives of working people. The working group brings together almost 50 foundation staff persons from across the sector to identify opportunities for deeper collaboration between philanthropy and labor.Additionally, the Democracy Alliance has been increasingly bringing together union leaders, foundation leaders and high net worth donors and is now chaired by a union leader for the first time in its history.It is also importance of ties between the philanthropic sector and the labor movement. That’s why last year NCRP’s board of directors welcomed two new members with deep ties to the labor movement: Molly Schultz Hafid of the Unitarian Universalist Veatch Program at Shelter Rock (and a member of the Funders for a Just Economy working group) and Bill Dempsey of the Service Employees International Union.

There is work to do to better bind the philanthropic sector and the labor movement – the members of the Funders for a Just Economy working group and the Democracy Alliance are already leading the way.

Let Labor Day be a reminder of the potential if other funders and donors follow their lead.

Ryan Schlegel is senior research and policy associate at the National Committee for Responsive Philanthropy (NCRP). Follow @NCRP on Twitter.