Most nonprofit organizations, including nearly all labor unions, must file an annual Form 990 with the Internal Revenue Service.[14] Unions disclose summary statistics about their revenue and other financial information on their 990s. They are not required to report their membership levels , however, so these reports offer only a limited view of the Janus ruling’s effect.[*]
Fortunately, there are other federal reports unions file that do require them to provide information about their current membership. Unions that represent at least one private sector employee and have annual receipts of $250,000 or more must file an LM-2 report with the U.S. Department of Labor.[15] These provide much more detailed information than 990s, including membership levels, individual officer compensation, total receipts and revenue by source, political contributions and itemized spending.[†]
LM-2s are valuable because they are comprehensive, easily accessible through the DOL and presumed to be accurate. The data is provided directly by unions, and it must be signed by the union president and treasurer who are both “personally responsible for its filing and accuracy.”[16] It is a crime to provide false information on these forms. LM-2s must be filed every year, and they are the best source for investigating financial trends among large public sector unions.
There are several limitations to using LM-2 data to assess the impact of Janus, however.
The most significant one is that most public sector unions are not required by federal law to file LM-2s because they do not represent any private sector workers. A review of the unions required to file LM-2s suggests that there is information from only 66 large public sector unions in the 22 non-right-to-work states affected by the Janus decision. In 2018, these unions represented about 3.4 million people collectively, according to their LM-2 reports. There were nearly 5.6 million people working under union contracts in those states, according to the BLS survey data.[17]
With those caveats, data from LM-2 reports shows that membership in these 66 public sector unions in the 22 non-right-to-work states decreased from 3,359,807 before Janus to 2,980,492 in the latest reports covering 2022. That’s a loss of 379,315 dues and fee payers, or 11.3%.
Similar results are found by zooming out to look at the impact of Janus on the largest public sector unions that file LM-2 reports. The National Education Association, American Federation of Teachers and American Federation of County, State and Local Employees file these federal reports but almost exclusively represent public sector employees. These unions had 5,292,481 members in the year prior to the Janus decision and have 4,743,397 members today. That’s a loss of 549,084, a 10.4% decline. However, the federal LM-2 reports filed by those three unions do not break out the data by state, so these numbers include members from all 50 states. That is, it includes data from the 28 right-to-work states where the Janus decision had no legal impact.
Graphic 1: Large public sector union membership, 2014-2022
Graphic 2: Large public sector union membership, 2014-2022
LM-2 reports are commonly used to track union membership for individual unions. But the fact that only public sector unions that also represent private employees are required to file them greatly reduces their usefulness in assessing the impact of the Janus decision.
[*] The information in publicly available 990s also lags by two years, which further reduces their value in assessing the real-time impact of Janus.
[†] Itemized spending is required for accounts or transactions valued at $5,000 or more. “Instructions For Form LM-2 Labor Organization Annual Report” (U.S. Department of Labor, Office of Labor-Management Standards, April 2020), https://perma. cc/Z3ZW-8YKG.