LaborPains.org

The former head of the SEIU Local 660, which represented more than 50,000 LA county workers until it folded into Local 721, was terribly creative in his attempt to make a little cash on the side…and take advantage of the members of the union he headed.  A shout out to the National Legal and Policy Center and Carl Horowitz for the following tale of corruption:

On August 27, Alejandro Stephens, formerly president of SEIU’s now-defunct Local 660, was charged in U.S. District Court for the Central District of California with two counts of mail fraud and one count of filing a false tax return. Stephens allegedly used his position as an official with the Los Angeles union to conspire with at least three other individuals to receive tens of thousands of dollars in kickbacks from phony “consulting” companies. Given that he’s already in hot water in a separate case that surfaced last year, it makes sense that he reportedly has declared his intention to plead guilty.  Union Corruption Update last September noted that a Los Angeles Times article implicated Stephens as a beneficiary of an illegal scheme hatched by a former girlfriend, SEIU Local 721 President Annelle Grajeda.

Among other sketchy activities documented in the LA Times, Horowitz continues:

The feds are charging that Stephens used his position as Local 660 president to enrich himself through a union-sponsored political action committee and a nonprofit group called Voter Improvement Program (VIP). Stephens and several associates allegedly set up bogus consulting firms in order to secure contracts from VIP for work never done. His partners then kicked back most of the money to him. All told, say the feds, he collected about $52,000 in nonexistent work during the period February 2004-April 2005. Moreover, he knowingly underreported $35,000 of this sum on his 2004 federal income tax return.

Read the whole story here and here.

Detroit’s citizens (and union members) can’t catch a break. Former Mayor Kwame Kilpatrick is even involved in this one too.

According to the Detroit News, the general vice president of Local 324 of the International Union of Operating Engineers John M. Hamilton allegedly  received multiple kick backs for investing millions in a Chicago-based investment firm.  The Detroit News explains:

An Illinois businessman told the FBI he arranged for an inflated price to be paid for the home of a Detroit-area union official in return for the union investing $65 million of its pension funds with his company.

John Orecchio of AA Capital Partners told federal investigators there was “a quid pro quo” between the Operating Engineers Pension Fund investing the money with his firm in December 2003 and Orecchio arranging for an inflated price to be paid for the home of John M. Hamilton, business manager and general vice president of Local 324 of the International Union of Operating Engineers, according to documents obtained by The Detroit News.

In July, Orecchio, a partner in the Chicago-based investment firm, was charged in federal court in Illinois with fraud and embezzlement. He is accused of misappropriating $24 million of the funds invested with his company by the Operating Engineers and other clients. He has had conversations with the FBI since at least 2006, and the charges are pending. Hamilton did not respond to telephone and e-mail messages Monday seeking comment.

The News reported Saturday that Orecchio told the FBI he wrote a $10,000 check in 2005 to the Kilpatrick Civic Fund, a nonprofit corporation controlled by the former mayor, to get an audience with Kilpatrick to “pitch” a $20 million city pension fund investment in AA Capital. [...]

Orecchio told investigators from the FBI and the Office of Inspector General of the U.S. Department of Labor that he spent a lot of money “wining and dining” Hamilton before and after the union made its $65 million pension fund investment with AA Capital.

To get rest of the story, read it here in The Detroit News.  There’s even a story involving Kwame, Las Vegas, and Oscar De La Hoya.  You can’t miss it.

Image courtesy of sultmhoor.

The SIEU has descended en masse (Do they descend any other way?) on Chicago this week to protest the ABA (American Bankers Association). . . and Wall Street . . .and bailouts..and big banks. You get the idea.

While it’s easy to blame a group that sounds guilty, like the American Bankers Association, it’s another thing entirely to be right. Perhaps the SEIU is just hoping no one will notice that the vast majority of the banks in the ABA (literally hundreds) are small banks–not the kind of banks that even glimpsed the billions that flew around in the bailout.

But information has never stopped a SEIU rally before.

Fox Business blogger Brian Sullivan writes:

Of the ABA’s hundreds of member banks only two – Bank of America and Citigroup – took bailout money. In fact, many of the ABA’s members would likely agree with the protestors’ position on bailouts, since not only did the bailouts help larger banks at the expense of smaller ones, but also the cost to the FDIC from the now 106 failed banks is forcing the FDIC to push a multibilion dollar prepayment plan for agency insurance, hurting banks’ balance sheets.

Additionally, it’s hard to see how many of these small banks “caused the financial crisis,” since most neither make mortgage loans nor syndicate derivatives built from the loans.

Maybe some of the ABA members and protestors should grab a beer.

Image courtesy of Luis Filipe Castro.

The headline in the Chicago Tribune says it all.  In fact I couldn’t think of a better one.

“Roofers, landscapers in turf was over Chicago’s rooftop gardens: Roofers union feels pushed out of green roof pastures”

Here are the parties involved, according to the NLRB:

International Union of Operating Engineers, Local 150, AFL–CIO and International Brotherhood of Teamsters, Local 703 and Moore Landscapes, Inc. and Laborers’ International Union of North America, Local No. 4 and United Union of Roofers, Waterproofers and Allied Workers, Local No. 11.

Apparently the roofers were upset that the landscapers (who are paid less by the hour) were allowed to landscape roofs.  The roofers claimed special expertise.  Moore Landscapes, Inc. and their unionized employees argued that they had superior landscaping expertise–having landscaped since 1948 in the Chicago area.  The NLRB ruled in favor of the landscapers.

Maybe the landscapers could gain more roofing skills and form a United Union of American Landscapers of Roofs of Skyscrapers and Other Shorter Buildings International.  The UUALRSOSBI would be an incredibly able (combining the skills of roofing and landscaping) to create “green” roofs.  And then no need for “turf wars.” But this is unions we are talking about.  Turf wars, even when they have nothing to do with grass, come with the territory.

For all you folks who like to read the NLRB’s rulings, here is the final Determination of the Dispute from the NLRB:

The National Labor Relations Board has made the following Determination of Dispute. Employees of Moore Landscapes, Inc., represented by International Brotherhood of Teamsters, Local 703, and International Union of Operating Engineers, Local 150, are entitled to perform all of the work in dispute at the Roosevelt Collection jobsite in Chicago, Illinois. Dated, Washington, D.C. September 30, 2009.

I will close with an African Proverb: When two elephants fight, it is the  grass that gets trampled.

Image courtesy of WildVanilla.

The Journal of Commerce had some words for Bloomberg in the wake of his announcement that he will fall in line with Teamsters bid to re-regulate America’s trucking industry. Well, that’s not what the Teamsters are calling it exactly… they are calling their initiative “green” and “environmentally friendly.”  But you get the idea.

The Journal of Commerce reported the following:

Newark, N.J., Mayor Booker joins Bloomberg, Teamsters in call for federal regulatory changes. The mayors of New York and Newark, N.J., surprised the trucking industry – as well as the bi-state port authority – by announcing on Sunday their support for a clean-trucks program that would make it possible for labor unions to organize harbor truck drivers. Mayors Mike Bloomberg of New York and Cory Booker of Newark not only endorsed a clean-trucks program modeled after the controversial one in Los Angeles, but the mayors also said they support an amendment to the Federal Aviation Administration Authorization Act to grant port authorities regulatory authority over harbor trucking. [...]

As for the Teamsters strategy, JOC continues:

The Teamsters’ strategy is therefore to find union-friendly mayors to announce support for an amendment to the F4A. Los Angeles Mayor Antonio Villaraigosa was the first mayor to announce support, and he was followed by Oakland Mayor Ron Dellums. The announcement Sunday by Bloomberg and Booker caught the Port Authority of New York and New Jersey by surprise as well.

Mayors of other major port cities beware. Baltimore, New Orleans, Tampa, Mobile, Houston.  You’re on notice.

Long Beach Press Telegram explains who stands to win what:

At the heart of the matter is a little-known piece of federal law, the Federal Aviation Administration Authorization Act, or FAAAA, which effectively allows companies to classify drivers as non-employees, or “independent owner-operators,” who get paid by the load and are made responsible for their own trucks, maintenance, fuel, insurance, tires and other necessities. [...] The debate goes back to 1980, when Congress passed the Motor Carrier Act of 1980, ending decades of tight federal control of the trucking industry enacted during the depths of the Great Depression and opening the door for thousands of new, non-unionized firms to flood the market with drivers paid not by the hour, but by the load.

Overhead on these new companies was low as they generally didn’t offer health benefits, retirement packages or overtime – an advantage that quickly allowed them to capture a large share of the market from the large, unionized firms. Within a few years of the law, membership in the International Brotherhood of Teamsters had been decimated, and in and around the ports of Long Beach and Los Angeles, virtually exterminated.

Now, unions want back what was taken “oh so many” years ago.

Other groups of home health care workers in Illinois have fallen in line, but not those who provide care to the developmentally disabled. Why?

Fundamentally, these homecare workers didn’t buy it that the unions could help them.

And aside from the drive receiving national press coverage, the entire unionization drive was entirely without class, i.e., it was widely reported that the SEIU and AFSCME were fighting…and union members were knocking on people’s doors at awkward times (like Sunday mornings) and calling incessantly.

At the heart of it, the amount of total funds available to pay these home care workers is capped by the Illinois state legislature–so aside from 2% of their pay having to be paid in union dues, home care workers told the press they didn’t know how the unions could promise better pay when there is no more money legally available.  The press reported that home care workers worried it would mean some of them would get knocked off the pay rolls entirely, when 18,000 are waiting to get on the rolls already. Only 3,000 are on the rolls.

It didn’t help these union’s cause that the entire unionization of home health care workers in Illinois was part of past and present governors’ [like disgraced Rod blagojevich] quid pro quo relationships with the SEIU, who contributed hundreds of thousands for the campaign in exchange for fresh blood.

Unions in Illinois are still on the run from the reputation Blago so generously gave them.  And their going to have to keep running.

Image courtesy of craynol.

Martin County, Florida, July 2001:

The Public Employees Union representing Martin County clerical and blue collar workers requests and successfully acquires a ruling from the county that allows workers to receive cash payouts instead of taking vacation.   The blue collar county workers request a plan estimated to total $250,000+.  The county administrators push for a cheaper plan to cost $100,000+.  The county workers and the union win and so begin the payouts, known as Paid Time Off [PTO] payouts.

Martin County, Florida, March 2007:

Blue collar workers vote to switch to Teamsters Local 769.

Martin County, Florida, October 2009:

Turns out, the PTO payments cost dramatically more than estimated– like a quarter of a million dollars in 2006 and 2007, but about half a million dollars in the last two years– more than $1.5 million total.  Despite having originally requested a cheaper payout, the biggest recipients were the highest paid workers in the county; blue collar workers payouts pale in comparison.  In fact, Acting Martin County Administrator Taryn Kryzda [salary: $146,982] received more than 33K in the last 4 years. Her husband Kevin Kryzda, Chief Information Officer, received more than 41K.  Ms. Kryzda complained to the local paper that it was unfair to criticize her and a handful of other top employees for taking advantage of the rule, and argues that she thinks that the PTO must be eliminated.  It is her job to prepare the budget every year.  The announcements comes after unionized workers were fired this year and after administrators had received their payouts for FY 2009.

This includes the job of the Teamsters shop steward Mavis Curley, logistics coordinator.  With a salary of $32,000, she made less than the payouts and is now fighting to get her job back claiming that she was retaliated against for her union activities.  She was pushing for a new Teamsters contract that included no wage increases, but no lay offs.  To make matters worse, Kryzda publicly supported the “elimination of her position,” before the magnitude of the payouts was made public.

So a union rule  in 2001 gets union workers fired, brings a county’s finances to its knees, and get county leaders [who opposed expensive PTOs in 2001] lots of cash–legally. Not sure if this will get Curley back her job, but it makes for great irony.

On Friday, we were treated to news that the federal deficit is officially $1.42 trillion for fiscal year 2009. Couple that with California’s eventful week trying to solve their budget crisis (while dealing with their unions), and come Monday morning, you’ve got a spate of article on the role of unions, public workers, and the public interest. Here are some the highlights:

A columnist in the Mercury News explains why California’s unions are in a unique position legally that allows them hold the state hostage fiscally.  Unionized state workers  may be “working under labor contracts that expired more than a year ago…. But if that sounds like a raw deal for the workers, it’s not.” He continues:

State employees, by law, continue to receive their existing wages and benefits even after their contracts expire. And in the midst of a fiscal crisis like California’s, in which personnel costs have become a top target for number-crunchers, that means unions have little incentive to sit down at the bargaining table and agree to any drastic cuts.  Meanwhile, as long as the unions continue to negotiate in “good faith,” the state has only limited leverage to extract concessions. Unions remain politically powerful, and even in a fiscal emergency, wresting significant wage and benefit savings is nearly impossible. Instead, the state must pursue other tactics such as furloughs — which, new studies suggest, may not save nearly as much money as officials had hoped.

With political power and expired contracts that continue to pay out even in a budget crisis, there is truly no incentive for unions to move quickly to get a new contract ironed out.  As long as the economy is bad, unions don’t really want to seal the deal on a concessionary contract that they will have to fight back from for years to come.

A columnist for the Sacramento Bee puts union’s political power bluntly:

Finally, public unions could bypass collective bargaining and seek benefits through legislation — again drawing on their relationships with politicians they helped elect. A case in point occurred a decade ago, when then-Gov. Gray Davis championed public union-backed legislation that sharply increased pension benefits after unions helped him win the governorship — a major contributor to pension systems’ current financial travails.

In this scenario, the public interest loses out to the the public sector union.

For a nationally focused piece on unions’ roll in states’ budget woes, check out Power Players in the Philadelphia Inquirer.

Image courtesy of Onkel_wart.