How Revenue is Spent at the AFL-CIO (2020)
The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) is a federation of 58 labor unions that represent 12.5 million workers. A non-profit, tax-exempt 501 (c) (5) – a labor organization, the AFL-CIO is headquartered in Washington, DC.
Key facts about the AFL-CIO include the following information taken from the IRS Form 990’s:
The AFL-CIO has 19 related tax-exempt, non-profit organizations, 14 of whom operate out of the same office address. The other 5 organizations also operate out of a two DC-based offices but at a different street address, and an office in Silver Spring, MD.
There are 98 voting members (board members) of the governing body, 89 of whom are independent. 78 of the 98 (80%) are male while 20 (20%) are female.
Revenue has been declining since 2013 when total revenue was $158 million. By 2017, revenue was down to $140 million and by 2018, total revenue was $119 million which appears to indicate membership has been declining but could also be due to a decline in royalties, or a combination of both. However, more recently in 2019, revenue increased to $126 million but in 2020 revenue declined to $114 million.
Revenue primarily comes from two sources: memberships dues and royalties. In 2020, $71 million of the $114 million (62%) came from memberships dues while $34 million (30% of total revenue) came from royalties.
Expenses totaled $93 million (82% of revenue) in 2020 – $21 million less than the revenue raised. The $21 million was added to the general fund (along with unrealized gains on assets) which increased from $46 million at the beginning of the year to $69 million at year-end – a significant increase.
The $93 million in expenses can be categorized as follows:
- $46 million (40% of revenue): Compensation
- $18 million (15% of revenue): Grants
- $ 9 million (8% of revenue): Royalties
- $ 7 million (6% of revenue): Office-Related Expenses
- $ 3 million (3% of revenue): Interest and Other Expenses
- $ 3 million (3% of revenue): Printing and Publications
- $ 3 million (3% of revenue): Travel and Conferences
- $ 2 million (2% of revenue): State Unity Fund
- $ 2 million (2% of revenue): Fees for Services (primarily other with no detail)
As illustrated above, compensation used up 40% of revenue in 2020. 428 employees received $46 million in compensation, which equates to an average compensation of $107,000. However, only 142 employees received more than $100,000 in compensation. The most highly compensated employee was Sean McGarvey who received $688,554 (from a related/affiliated organization).
The AFL-CIO paid for first class or charter travel, travel for companions and made gross up payments or provided tax indemnification. No detail is provided.
108 grants greater than $5,000 were made with the 7 largest reported to be:
- $6,813,500: Working America
- $ 900,000: National Labor College
- $ 600,000: Alliance for Retired Americans
- $ 325,000: American Center for International Labor Solidarity
- $ 216,143: Texas Gulf Coast Are Labor Federation AFL-CIO
- $ 208,078: Tenn AAFL-CIO Labor Council
- $ 200,000: Solidago Foundation
The purpose of most of the grants was program support, operating subsidy, a culture of health grant, a solidarity funding grant, or general support.
Using the above information, every $100 in revenue was spent as follows in 2020:
-$ 40: Compensation
-$ 8: Royalties
-$ 6: Office-Related Expenses
-$ 3: Printing and Publications
-$ 3: Travel and Conferences
-$ 3: Interest and Other Expenses
-$ 2: State Unity Fund
-$ 2: Fees for Services (primary other with no detail provided)
-$ 67: Subtotal: Organization Expenses
$ 33: Revenue Remaining
-$ 15: Grants
$ 18: Revenue Remaining: To General Fund
As illustrated above, $67 out of every $100 was spent on organization expenses while $15 out of every $100 was used for grants – primarily to other labor organizations.
It is important to note the AFL-CIO ended the year with $69 million in net assets, compared to $46 million the prior year. The improvement is primarily due to the organization spending $21 million less than they raised in 2020.
To read the IRS Form 990 (2019 for the year ending June 30, 2020), click here.