Labor Pains: Because Being in a Union can be Painful

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  1. Johnny Doc Gets Wiretapped

    For more than a year, the Federal Bureau of Investigation (FBI) wiretapped the cellphones of Philadelphia union boss John “Johnny Doc” Dougherty, who runs the International Brotherhood of Electrical Workers (IBEW) Local 98. As part of an ongoing investigation into union corruption, FBI agents also monitored Democratic City Councilman Bobby Henon and Local 98 political director Marita Crawford, and Joseph Ralston, a former investigator with the state Attorney General’s Office.

    According to PhillyVoice, “Henon also has a salaried job with Local 98, and Ralston performed security work for the union.” This could raise serious conflict of interest questions, given their positions in local and state government, respectively. Last summer, FBI and Internal Revenue Service agents searched Dougherty’s office, a nearby union bar, and the IBEW union’s headquarters to gain a better understanding of Local 98’s relationship with Henon and Ralston, in addition to union finances.

    The union has long been one of the country’s most prolific spenders. According to its most recent financial disclosures, Johnny Doc earns more than $406,000 annually, including nearly $227,000 in base salary and $169,000 in “disbursements for official business.” Counting Dougherty, the local union pays 27 employees six-figure incomes using member dues. By contrast, Boston’s IBEW Local 103 pays its president, Louis Antonellis, roughly $154,000 in base salary, with less than $3,000 reserved for business-related spending. Local 98 is also well-known for spending hundreds of thousands of dollars on sports tickets and luxury goods. (We covered Local 98’s finances in detail here.)

    It could be another rough summer for Johnny Doc.

    Categories: Crime & CorruptionUnion Spending
  2. The Employee Rights Act Goes to a Hearing

    The House Subcommittee on Health, Employment, Labor, and Pensions recently held a hearing on the Employee Rights Act (ERA) for the first time ever. It is the most significant development with the ERA—the most substantive update to American labor law since the 1940s—since its introduction in 2011. The Center for Union Facts ran an ad in Roll Call on the day of the hearing (see below).

    One of the witnesses was Karen Cox, a blue-collar employee from Illinois who was forced to join the Retail, Wholesale, and Department Store Workers Union (RWDSU) in 2012. She never received a secret ballot vote, which the ERA would guarantee. RWDSU organizers pressured Karen and her coworkers into publicly signing authorization cards to recognize the union—without a secret ballot vote. When Karen tried to decertify the union, the RWDSU threatened her. You can see Karen’s story here.

    But do union elites have any sympathy? Apparently not. At the hearing, Jody Calemine, general counsel for the Communications Workers of America (CWA), testified that he’s never seen “a bill as extreme and provocative and anti-union and anti-worker as the Employee Rights Act.” The International Association of Machinists and Aerospace Workers (IAM) claimed that the ERA is “designed to empower billionaires and CEOs, not working people.” The union-funded Center for American Progress even suggested that the legislation is an example of “voter suppression.”

    The “secret ballots suppress voters” argument is an interesting one, to say the least. If the ERA is the most “anti-union” piece of legislation in human history, then why do 80 percent of union household voters support it?

    The next step for the bill is a hearing before the full House Education and Workforce Committee, which will decide whether there’s a floor vote. Employees like Karen Cox are crossing their fingers for one.

     

     

    Categories: Employee Rights ActEnding Secret Ballots
  3. Labor Racket Weekly: Mobsters and Union Bosses

    A Chicago mobster and two union presidents saw their days in court. Here are this week’s best labor rackets:

    • In Texas, Clementine T. Ray, former President of American Federation of Government Employees (AFGE) Local 2109, pled guilty to a superseding information of false writings.
    • In Illinois, John A. Matassa, Jr., Secretary-Treasurer of Independent Union of Amalgamated Workers Local 711, was charged in an indictment with two counts of wire fraud, two counts of theft of approximately $3,291 in government funds in the form of Old-Age Insurance Benefits, four counts of embezzling $2,959 in union funds, and two counts of making false entries in union records. Matassa is known for his connections to organized crime in Chicago in the 1990s.
    • In New York, David Diaz, former President of American Federation of Government Employees (AFGE) Local 387, was sentenced to 280 hours of community service in lieu of 60 days in jail and three years of probation. Diaz was also ordered to pay $17,149 in restitution. On March 16, 2017, Diaz pled guilty to Petit Larceny.

    Check back next week for more unionized crime.

    Categories: Labor Racket Weekly
  4. Cash-Strapped Longshoremen’s Union Uses Ghost Workers

    Ghost work. Call it Big Labor’s newest corruption scheme.

    According to news reports out of Florida, the Tampa-based International Longshoremen’s Association (ILA) Local 1402 is allegedly paying “ghost workers” for dock jobs they don’t perform, at the expense of actual union members. ILA Pension Board Trustee Evan Cotten claims to have uncovered the problem last year by tracking longshoremen time sheets and the movement of cargo and supplies on and off the docks of Port Tampa Bay. Cotten explains, “A lot of money is involved that has been distributed to people who didn’t earn it and a lot of people have been deprived of that money. I think it’s criminal.”

    How bad is it? The ghost worker problem could go back at least five years, as Cotten has uncovered seven or eight such cases.

    One potential explanation is that inflating the number of employees on payroll limits individual pension payouts. Longshoreman routinely compete for jobs and hours. Their benefits improve as they accumulate hours and perform more dock jobs. Ghost workers increase competition for these jobs, making it more difficult for actual union members to work, reach thresholds, and accrue benefits. As Cotten puts it: “Failure to reach 700 [annual hours] by one hour will mean hundreds or thousands of dollars over the course of a year and it will mean his seniority position, his work ranking, his health benefits and eventually, his pension benefit.”

    Local 1402’s pension is woefully underfunded, giving union officials an incentive to cut back on payments. Records indicate that administrative expenses for the Local 1402 pension fund in 2010 were $509,528, compared to employer contributions of $393,110 that same year. That red ink is real.

    Categories: Crime & CorruptionEntitlements CrisisUnion Spending
  5. Congress Reintroduces the Employee Rights Act

    The Employee Rights Act (ERA) is back. Rep. Phil Roe (R-TN) recently reintroduced the ERA, the most comprehensive update to American labor law since the Taft-Hartley Act of 1947. Last session, 170 members of Congress co-sponsored the legislation, including 33 U.S. senators. (Learn more here.)

    The ERA protects workers from abusive union leadership with eight pro-employee reforms. Among other provisions, the bill would require secret ballot union elections and allow employees to periodically re-assess their union representation. Less than 10 percent of union members ever voted for the union currently “representing” them. Those who did were not guaranteed the right to a private vote. Moreover, union officials are not required to hold recertification elections, which leaves many employees “represented” by union officials they never even voted for. The ERA would make every union vote a private one and make it easier for employees to leave an out-of-touch union.

    Less than one percent of local unions get voted out each year. Yet polling shows that 75 percent of current and past union members have a negative view of union leadership, suggesting that decertification rates should be much higher. The system is broken.

    The ERA would also prevent union officials from spending member dues on political advocacy without prior approval. Since 2012, union officials have sent more than $530 million to the Democratic Party and liberal special interest groups, even though 40 percent of those in union households vote Republican in any given election cycle. The bill would allow employees to have an affirmative say before funding political advocacy efforts they might not agree with.

    Union-backed liberal think tanks like the Economic Policy Institute (EcPI) predictably attack the ERA, criticizing a provision that requires union officials to win the support of the majority of all eligible workers before unionizing a workplace. But their criticism doesn’t pass the smell test. Voting for a union isn’t like voting for a member of Congress. Unlike regular voters, employees are deciding whether to have monthly dues taken out of their paycheck, so union representation is a much more directly personal issue than electoral voting. Regular voters also have a guaranteed opportunity to vote for their members of Congress every two years. Employees have no such option in a union workplace. When less than one percent of unions get voted out despite high disapproval, employees need more legal protections.

    National and regional polls show that 80 percent of those in union households support the ERA’s key provisions. The bill is so popular that the Heritage FoundationAmericans for ProsperityFreedom Foundation, and Workplace Fairness Institute have already endorsed it. As Congressman Roe says: “The Employee Rights Act isn’t pro- or anti-union, it’s a common-sense measure to ensure a transparent and fair workplace.”

    Congress, let’s make it happen.

    Categories: Employee Rights Act
  6. Labor Racket Weekly: Cross-Country Corruption Continues

    Corruption. Embezzlement. Allegedly unauthorized cash withdrawals. Here are this week’s best labor rackets:

    • In Arkansas, Jeni May Hughes, former office manager for Plumbers Local 155, pled guilty to embezzling $428,874 in union funds.
    • In Iowa, Curtis Lang, former President of the United Dairy Workers of LeMars, pled guilty to one count of embezzlement. On March 22, 2017, Lang was indicted for one count of embezzling union funds in the amount of $45,040.
    • In New York, Victor Davila, former President of the Hunts Point Police Benevolent Association, was charged with one count of embezzlement of union funds. Why? He was spending association funds on personal expenditures and making approximately $35,000 in cash withdrawals that were not authorized by the union.

    Circle back next week for more union shenanigans.

    Categories: Labor Racket Weekly
  7. SEIU Members Sue Mary Kay Henry Over Nevada Power Grab

    shutterstock_299196185Union members to Mary Kay Henry: You crossed a line. A group of Nevada union members recently sued Henry, international president of the Service Employees International Union (SEIU), and other SEIU officials for seizing control of their local union.

    Last month, Henry removed Cherie Mancini, board member of the Nevada-based SEIU 1107, after Mancini cancelled a contract ratification she deemed harmful to Local 1107’s members. Mancini publicly accused the union’s bargaining team of violating its fiduciary duty to membership. Within days, Henry stripped Mancini of her board membership and suspended her union membership; removed Sharon Kisling, SEIU Nevada’s former executive vice president from office; and took control of Local 1107’s finances, contract negotiations, and day-to-day operations. The SEIU has allegedly taken out credit cards on the local union’s account.

    Now, Mancini and nine union members are speaking out against Henry’s forced trusteeship, calling it a “manufactured emergency” situation. The plaintiff is Raymond Garcia, a dissatisfied Local 1107 member. Peter Nguyen, Local 1107’s former director of organizing and representation, claimed the following: “I’m certain that there’s irreparable harm that’s taken place to the members because the bargaining process has clearly been disrupted.”

    The SEIU’s bickering now moves to a federal court, which will decide whether to reverse the trusteeship. Power struggles: Just another perk of union membership.

    Categories: SEIU
  8. Labor Racket Weekly: $71,523 in Dues for “Personal Use”

    shutterstock_547250767Union dues are being used for union leaders’ personal benefits, not members’ benefits. Here are this week’s best rackets:

    1. In Illinois, Thomas M. Miller, former Secretary-Treasurer of Brotherhood of Locomotive Engineers and Trainmen (BLET) Division 815, was charged with embezzling approximately $10,686 in union funds.
    2. In Rhode Island, Christopher Hayes, former Rhode Island Police Department Sergeant and former President of Fraternal Order of Police (FOP) Lodge 8, pled guilty to an information charging him with one count of wire fraud. Hayes admitted to the court that, between August 2009 and December 2014, he used an FOP debit card to pay for his own personal expenses; wrote checks payable to himself from the FOP bank account; withdrew cash from the FOP bank account for personal use; and made online payments to his personal credit card from the FOP bank account, converting approximately $71,523 in union funds for his own personal use.

    Check in next week for more union fails.

    Categories: Labor Racket Weekly