National Nurses United

Audit + Index_FINAL 12/30/09 2:16 PM Page 19 CALIFORNIA NURSES ASSOCIATION NOTES TO FINANCIAL STATEMENTS (CONTINUED) NOTICE TO NON-MEMBERS Note 15 - Commitments CNA has leased office space for its five satellite offices located in Santa Clara, Sacramento, Fresno, Glendale and San Diego, California under non-cancelable leases with remaining terms of one to five years. Additionally, CNA has leased office space in Chicago, Illinois and Austin, Texas. Starting in February of 2009, per agreement with the California Nurses Foundation (CNF), CNA will be paying 35% of the lease amount at CNF's space in Oakland, California. Future minimum rentals under leases at June 30, 2008 have been incorporated into the schedule below. Fiscal Year Ended June 30 2009 2010 2011 2012 $ Total Lease Payments $ Operating Leases 522,425 410,521 133,818 - NOTICE TO EMPLOYEES OF PUBLIC EMPLOYERS WHO ARE COVERED BY PUBLIC LABOR RELATIONS ACTS IN BARGAINING UNITS REPRESENTED BY THE CALIFORNIA NURSES ASSOCIATION/ NATIONAL NURSES ORGANIZING COMMITTEE, BUT ARE NOT MEMBERS OF CNA/NNOC, AND TO EMPLOYEES OF PRIVATE EMPLOYERS WORKING UNDER COLLECTIVE BARGAINING AGREEMENTS WITH ASSOCIATION SECURITY PROVISIONS You are required to pay Fair Share ("Agency") fees to the California Nurses Association/National Nurses Organizing Committee ("CNA/NNOC") as a condition of your employment if you are employed by a public sector employer covered by the California Higher Education Employer-Employee Relations Act (Cal. Govt. Code § 3560 et seq.), the Meyers-Milias-Brown Act (Cal. Govt. Code § 3500 et seq.), the Illinois Public Labor Relations Act (5 ILCS § 315/1 et seq.), or a private sector employer that is a party to a collective bargaining agreement with CNA/NNOC containing an association security clause, and you work in a job classification included within a recognized bargaining unit for which the CNA/NNOC serves as your collective bargaining representative. The purpose of the fair share/agency fee obligation is to prevent "free riders" – those employees who reap the economic benefits, improved working conditions, and personal and workplace protections achieved through union representation, but who refuse to share in the costs – "avoiding their fare share of the process from which they benefit." 1,066,764 CNA/NNOC's Representational Role CNA/NNOC engages in representational activities addressing terms and conditions of employment common to all workers such as wages, benefits, and job security. However, CNA/NNOC's representational role also includes responsibilities to the registered nurses it exclusively represents concerning terms and conditions of employment that are unique to registered nurses. Registered nurses are required as a condition of employment to maintain their professional licenses in good standing, perform their work and professional practice responsibilities of providing patient care in accordance with standards of professional performance and competence mandated by law, maintain clinical competency for particular patient care assignments through proper instruction and continuing education, and discharge their professional and legal responsibilities as patient advocates with a singular commitment to the interests of patients, a commitment that increasingly conflicts with the interests of their employers. As a result of the radical restructuring, consolidation, and increasing commercialization of the healthcare industry over the past several years, the work place pressures on registered nurses have become increasingly severe, resulting in greater risks to patients, and placing nurses' licenses and ultimately their qualifications for continuing employment in jeopardy. The increasing conflict between the interests of direct care registered nurses and their hospital/health care provider employers arises from the essential purpose and necessary operation of today's health care delivery sys-19- tem financed by profit on insurance risk. This system operates on "capitation" and other forms of "at risk" financing that transfer to medical and hospital providers the insurance risk of incurring costs for providing services promised to members of a group in excess of premium revenue from that group. These financing arrangements have reversed the economic incentives of medical groups/physicians and hospitals in providing care, aligning provider interests with HMO/insurer interests to maximize provider revenue and profit on insurance risk by limiting access to health care services, ignoring individual patient needs, denying necessary services, and disregarding minimum standards of safe, quality health care. and benefits of CNA/NNOC membership. The decision to decline CNA/NNOC membership should be carefully considered because of the rights and benefits that are forfeited by non-members. NON-MEMBERS CANNOT: • Vote on the terms of CNA/NNOC contracts establishing terms of employment for nurses • Participate in the development and discussion of contract proposals Registered nurses and practice are the principal target of hospital/health care provider operational priorities to generate surplus revenue under "at risk" financing arrangements because the nursing labor budget is by far the largest provider operational cost. "Restructuring" of nursing services resulting in reductions in RN staff and increased patient loads, clinical pathways, charting "by exception," RN decision support technologies and many other hospital/health care employer direct attacks on staff nurses and nursing practice reflect health insurance/HMO initiatives effectively implemented through provider "at risk" financing arrangements as a means to achieve the common goal of increasing profit on insurance risk. • Participate in strike votes • Nominate, vote for, or serve as an officer or representative of CNA/NNOC • Attend and participate in CNA/NNOC membership meetings As an organization, CNA/NNOC's essential representational role is to: (1) empower registered nurses to act collectively in defense of their professional and license responsibilities to patients and health care consumers to practice nursing care under working and practice conditions which ensure safe, competent and therapeutic patient care; and (2) to represent registered nurses in all appropriate forums and by all necessary means to ensure that their working and practice conditions satisfy the minimum standards necessary for faithful discharge of their professional and license responsibilities to provide safe, competent and therapeutic patient care. This essential representational role includes activities to defeat health insurance and health care industry operations and initiatives which seek increased profits through elimination of hospital direct care nurses and degradation of direct care RN practice and patient care standards. CNA/NNOC engages in a broad range of activities to address these working and practice issues on behalf of nurses represented by CNA/NNOC and charges fair share fee rates that reflect the level of activity and expenditures directly related to these representational activities. CNA/NNOC's representational activities are outlined below along with those activities that are paid for by CNA/NNOC members, but not charged to non-member fee payers. Fair Share Fee Rate As a non-member represented by CNA/NNOC, you are charged a fair share fee that is 10.93% less than the regular membership dues paid by CNA/NNOC members. Regular CNA/NNOC membership dues include amounts for political activities and certain member- supported activities that are not charged to non-members. Non-members are charged a reduced rate (fair share fee) based on expenses that are germane to CNA/NNOC's representational role. Nurses who choose to be non-members of CNA/NNOC can protest CNA/NNOC's allocations of chargeable expenses included in the non-member fair share fee which a protestor believes are not germane to CNA/NNOC's representational role. However, if you decline membership and wish to protest your fair share fee, you must forfeit the many rights NOVEMBER | DECEMBER 2009 • Enjoy other benefits of CNA/NNOC membership CNA/NNOC Fair Share Fee Calculation Non-member fair share fee payers are required to pay the proportionate share of the regular monthly membership dues that represents expenses germane to CNA/NNOC's representational role. For the one-year fair share fee periods of July 1, 2008 through June 30, 2009 and July 1, 2009 through June 30, 2010, this non-member fair share fee has been set at the rate of 10.93% of regular member dues based on an allocation of CNA/NNOC's expenditures, which are audited by independent accountants, into chargeable and non-chargeable expenditures. The amount chargeable was calculated as the average of chargeable expenses based on audits for the two fiscal years ending June 30, 2007 and June 30, 2008, after review and adjustment of charges scheduled for the period July 2008 through January 2010. Non-chargeable expenditures were higher during the fiscal year ending June 2007 than in fiscal year ending June 2008, so a downward adjustment is being made to fees owed for the months February through June 2010 to compensate with interest for any overpayment of fees. Thus, for the five-month period from February through June 2010, fair share fees will be set at $91.27. Any challenge to the allocations of chargeable expenses included in the CNA/NNOC fair share fee calculation must comply with the procedures described in this notice. Expenses Germane to CNA/NNOC's Representational Role This notice includes summary expense reports, based on the audited expense statements for the fiscal years ending June 30, 2007 and June 30, 2008, showing categories of CNA/NNOC expenses divided into: (1) chargeable W W W. C A L N U R S E S . O R G REGISTERED NURSE 19

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