Trade Union – Non-Profit Organisation

In the modern world, non-profit organisations are assuming an increasingly important role compared to profit-making organisations. No task is an end in itself and must deliver a result. With my thesis, I wish to bring the trade union organisation closer to trade union representatives and the public who wish to learn about the field of trade union organisation and are particularly interested in this area.

Solution and Method

In the modern world, non-profit organisations are assuming an increasingly important role compared to profit-making organisations. They are extremely diverse and, in the broadest sense, encompass all public administration, education, healthcare, social services, culture, politics, associations, trade unions, charity, sport, etc. The essential difference between a profit-making and a non-profit organisation lies in the objective of their operations.

Whilst the objective in profit-making organisations is to generate profit, non-profit organisations aim to provide services of general and common importance, which satisfy certain social needs that enhance the quality of life or social welfare. The basis for understanding the trade union in an organisational sense addresses its internal structures. The conditions for the activities of the trade union and its organisation are typically determined by law.

There also exists the International Labour Organisation Convention on Freedom of Association, which is also binding on Slovenia as a member of the European Union.

Results

No task is an end in itself and must deliver a result. With my thesis, I wish to bring the trade union organisation closer to trade union representatives and the public who wish to learn about the field of trade union organisation and are particularly interested in this area. Because there is too little accessible literature and handbooks available that regulate the functioning of trade union organisations, I have endeavoured to the best of my abilities and, on the basis of my thesis, have also produced a handbook.

I believe that this will enhance trade union activity and the satisfaction of those whom we represent. Every organisation carries out its activities with specific objectives. The fundamental objectives of an individual organisation's operations are what enable the differentiation of organisations and their division into companies or business entities.

The fundamental objective of organisations is profit. The difference lies with non-profit organisations, because the fundamental objective is not profit, but rather ensuring the needs of various interest groups by providing goods and, above all, services, or the effective use of resources to achieve desired outcomes. The achievement of desired objectives expresses user satisfaction and improvement in quality of life.

All those who have common interests are, by natural laws, inclined to unite in order to safeguard common interests more easily. Historically speaking, the association of workers is directed towards improving the conditions of individual work through collective actions, which should ensure a balance between the contracting parties. One of the forms of non-profit organisations is the trade union.

This is a voluntary, independent, non-profit association of workers employed in the same activity, who unite on the basis of jointly determined interests, defined in the fundamental act of the trade union. The fundamental objective of the trade union organisation is to represent the interests of workers, members or employees, and freedom, personal development, justice, social security, equal opportunities and solidarity. In managing a non-profit organisation – a trade union – it is necessary to observe Trade Union Law, which in the Republic of Slovenia is defined by the Constitution of the Republic of Slovenia, the Act on the Representativeness of Trade Unions, the Associations Act, the Statute of the individual trade union and the code of conduct, if it has one.

In addition to those listed, there are also many international sources of trade union law that must likewise be observed. Trade unions can acquire funds for their operations through membership fees, interest, donations from donors, sponsorship of individual campaigns, humanitarian aid and other events, participation in educational campaigns and other sources. The method of maintaining business books and preparing annual reports for trade unions is determined by Slovenian Accounting Standard 36.

Business books are maintained according to its own chart of accounts, compiled on the basis of the chart of accounts framework for non-profit organisations – legal persons under private law, adopted by the Slovenian Institute of Auditors. The annual report consists of a balance sheet, a statement of revenues and expenditures and notes to the statements, and a business report. The annual report is prepared for the financial year, which is the same as the calendar year, that is, for the period from 1 January to 31 December.

It is essential that, in the statement of revenues and expenditures, revenues from public finance funds and revenues achieved through the provision of public services are shown separately, whilst expenditures must be broken down in such a way as to enable insight into the composition of costs by types of expenditure. Accounting information from annual reports is used by various internal and external users. They serve their purpose, therefore accounting information must be prepared in an understandable manner, must present essential matters, must be reliable and also mutually comparable.

The first part of the thesis is theoretical and consists of summaries that I obtained with the help of literature, trade union acts, valid legal sources in the Republic of Slovenia and with the help of the internet, where the non-profit organisation, particularly the trade union, is presented in more detail. Theoretically, I wished to define the concept of a non-profit organisation, particularly the trade union, from its establishment, purpose and operation in general. In the central part, I presented the operations of a non-profit organisation – the trade union.

I used documentation that is connected with accounting and tax legislation, as well as regulations that the trade union uses in its work. The operations of a trade union or non-profit organisation differ considerably from profit-making organisations. To some extent, related obligations and duties are also visible, since a non-profit organisation is an independent legal person and is therefore obliged to maintain business books in accordance with the Accounting Act and to observe Slovenian Accounting Standards, and when closing the financial year, also to prepare annual reports.

In the continuation, on the basis of a survey conducted, I also graphically presented the extent to which trade union representatives know their trade union organisation, their expertise, the legal provisions for its establishment, management and operations. Trade union representatives also cooperate with accounting services, where they are provided with professional assistance in managing the organisation. I was also interested in the opinion of accountants regarding the expertise of trade union representatives and what they observe and what they miss in them.

The research showed that trade union representatives are insufficiently professional and that they know the trade union organisation that they manage or in which they participate rather poorly. This was also confirmed by the opinions of accounting services. As I mentioned several times in the research section, the reason for the lack of expertise and knowledge of trade union representatives is the insufficient literature for non-profit organisations or trade unions.

Because I myself cooperate extensively with trade union representatives, I decided that, on the basis of my diploma thesis, I would produce a handbook that will assist trade union representatives in establishing and managing a non-profit organisation – a trade union. With the help of the handbook, they will be able to present themselves to all interested members of the public who wish to learn about the field and operation of trade union organisations, but above all, the handbook will assist newly established trade union organisations. I believe that by producing the handbook, I will contribute greatly to better expertise of trade union representatives, which will facilitate the work of both founders of trade union organisations and also work in accounting services that deal with trade union representatives.

I confirm the hypothesis that I set at the beginning, that trade union representatives, with better knowledge of the legislation concerning the operation of trade union organisations and workers' interests, would represent them more effectively and successfully. I believe that it will therefore be necessary to invest in the education of trade union representatives, to provide more appropriate literature and, with the help of experience, also to assist or advise. The expertise of trade union representatives contributes to more effective work, which is demonstrated by work results, and on the basis of these, trade union organisations also gain greater trust from their members or workers.