How Public Sector Unions Hide Member Dues To Finance Political Activism

Every year, labor unions collect billions of dollars in dues from public employees. But how union officials spend that money — or whether it even benefits workers at all — is often a mystery.

This Labor Day, two New Jersey public school teachers have a $40 million question they believe will resonate across the country: Where are our dues going?

Marie Dupont and Ann Marie Pocklembo say the New Jersey Education Association (NJEA) broke its promise to members like them when it created a dues-funded pipeline to advance its own president’s political ambitions. The teachers allege in a lawsuit that NJEA membership materials indicated that regular dues were separate from voluntary contributions to the union’s political action committees. Dupont and Pocklembo, who were not interested in supporting the union’s PACs, took this promise at face value.

But according to their lawsuit, the union quietly funded its super PAC, Garden State Forward, with tens of millions of dollars in mandatory dues, then transferred more than $40 million from Garden State Forward to union-tied political groups that backed then-NJEA president Sean Spiller in the 2025 Democratic gubernatorial primary.

Meanwhile, the union had failed to report its massive contributions to Garden State Forward as political activity on its annual IRS returns going back to at least 2013, according to an IRS complaint by the New Jersey Policy Institute, which says the NJEA sent more than $100 million to Garden State Forward.

Following this scrutiny, the union’s latest annual IRS return, filed last month, now appears to report its Garden State Forward contributions as political activity for the first time — a welcome change, but one that likely leaves members wondering why the union reported tens of millions of dollars in similar spending differently in prior years.

A recent study on national teachers’ unions suggests a larger pattern of obscured political spending. The report found that the NJEA’s parent union, the National Education Association (NEA), reported less than $100,000 in staff compensation for political activity in the 2024 fiscal year, representing a 99 percent decrease from the union’s average of $7.9 million over the previous decade. Yet the union’s overall political spending did not drop by a similar amount. And the following year, the compensation category bounced right back, the study found. This means political work may be routed through outside organizations rather than shown directly on the NEA’s own books, according to the report.

Political activity is only one category of union spending where members may find it nearly impossible to verify how their money is being spent. Even basic financial reports can leave members in the dark.

The Chicago Teachers Union, for instance, long resisted releasing five years of audits until pressure from members — represented by the nonprofit Liberty Justice Center — and lawmakers forced its hand.

Those audits eventually revealed adverse opinions from the union’s own auditors, who said the financial statements previously given to members left out related foundations holding tens of millions of dollars in assets.

It’s not just teachers’ unions that seem willing to hide the ball from their own members.

In Connecticut, my firm represents Professor Earl Ormond, a former police officer now overseeing the criminal justice program at a community college, and Ryan Bilodeau, a state corrections officer, who want transparency from union officials.

A 1957 state law requires public-sector unions to file annual financial reports with the state labor commissioner and, crucially, says members can request state-conducted audits of those records. Ormond and Bilodeau should have access to that information — except that most unions in the state have never filed those reports, and the labor commissioner, who has the duty to enforce the law, has not been doing so.   

“When you can’t get straight answers about where your money is going, your trust in the union starts to break down,” Bilodeau said. “Auditing the spending is the core of everything. If someone is hiding financial details from you, it raises red flags.”

Only after Ormond and Bilodeau filed suit did the commissioner finally notify labor unions that they must follow the law. And last month, the court entered judgments in Ormond and Bilodeau’s favor, with their unions stipulating they will comply with applicable financial reporting laws now and in future years.

The legal victory puts union officials across Connecticut on notice that their members can turn to the courts to enforce financial transparency requirements.

Union members from Chicago and New Jersey are also demanding to be treated as more than cogs in a political machine or revenue streams directed by union insiders. It’s time for union officials to step up and respect their members’ rights by following basic transparency and disclosure laws before a lawsuit becomes a public servant’s last recourse.

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Nathan McGrath is president and general counsel at the Fairness Center, a nonprofit, public interest law firm that provides free legal representation to those hurt by public-sector union officials. The Fairness Center represents Dupont, Pocklembo, the New Jersey Policy Institute, Ormond, and Bilodeau.