Dwarfs live inside the mountains. They are experts in smithing, mining and crafting. When The Union started they saw it as a waste of their time. In their opinion they had far more to offer than to gain.
But then anti-magic was discovered, a new metal capable of stopping magic. Such a revolutionary discovery not done by dwarfs was perceived as a failure. For the next 382 years they sought out another big discovery to prove they could do more alone than The Union could together.
But when nothing came they finally gave in and agreed to join in exchange for funding their research it new smithing, mining and crafting techniques.