Acting on advice from his legal counsel, University President Dave Frohnmayer has announced that the University will not pay its membership dues to the Worker Rights Consortium, which has raised doubts about the University’s future commitment to the group.
Frohnmayer released his announcement on the president’s section of the University’s home page. In it he states that after the first meeting of the fledgling sweatshop monitoring group, he began to have “concerns over the legal status of the WRC.”
The University and Frohnmayer have previously contended that the WRC has not incorporated itself as a non-profit organization with corresponding non-profit status with the Internal Revenue
Service.
These doubts were serious enough for Frohnmayer to concur with University General Counsel Melinda Grier to not pay the membership dues.
“Until the proper legal concerns are addressed, we cannot pay dues or affiliation fees to the WRC and therefore can not, at this time, become a member,” Frohnmayer stated.
Frohnmayer is currently in the Netherlands and could not be reached for comment about his statement.
WRC representative Maria Roeper said the University’s claims about the consortium’s status are inaccurate. She said the WRC is incorporated in its home state of New York, and is currently in the process of receiving non-profit status from the IRS.
In a legal opinion she wrote Oct. 9, which is also posted on the University’s Web site, Grier argues that because in the University’s opinion the WRC has neither incorporated itself, nor secured non-profit status, it can not pay the consortium any membership dues. She states because the University is a public institution it is strictly bound by Oregon law as to what and who it can and can not make payments to. An organization that Grier said is neither incorporated nor has non-profit status is an institution the University can not pay. She said that the WRC may have filed for a certificate of incorporation and non-profit status, but she still thought that the group was in the process and had not officially received either designation.
“My understanding is that filling a certificate of incorporation is one step of incorporation,” she said. “You’re not a non-profit entity until you’ve been told you are.”
“You can’t just pay public money because you feel like it,” she added.
Not only does Grier find fault with the WRC’s legal status, she said the University is also concerned about the issue of liability of the WRC.
In her statement Grier argues that the WRC and its by-laws “provide no protection at all for ‘members’ or for those who pay ‘membership dues’ or ‘affiliation fees.” She then states that because the “nature of the University’s relationship with the WRC is so uncertain, this exposes the University to potential liability for the actions of the WRC.”
All of these reasons has Grier saying the University’s hands are legally tied when it comes to paying the WRC its membership dues.
“Right now the way things are is there’s an invoice and we can’t pay it,” she said.
She added that if the situation does resolve itself the University will continue to work toward a relationship with the consortium, and cautioned that she wrote her opinion a few weeks ago and the situation may have changed. She added that the University had received no correspondence from the WRC about its status.
Roeper would not make any other comment on why the University would not pay the dues aside from citing that the University has expressed the most concerns about the WRC of any school that has joined the organization.
“They’ve certainly been the most vocal school in writing letters and raising more issues than anyone else,” she said.
She added that the University’s doubts about the WRC stand in contrast to the dozens of other universities that have already sent in their dues. She said Brown University, all nine University of California campuses and nearly a dozen other schools have sent in their dues.
To join the WRC, each school is required to send in an amount equal to 1 percent of its merchandising contract. Roeper did not know what the exact amount the University would owe the WRC for membership dues, but it has been previously reported to be approximately $3,000.