Labor Pains: Because Being in a Union can be Painful

  1. UAW Spent Big To Defend Guilty Ex-Prez, and Other Officials

    The United Auto Workers (UAW) is still embroiled in an ongoing corruption scandal that goes all the way to the top of the union’s leadership.

    Most recently, former UAW President Gary Jones pleaded guilty to helping embezzle hundreds of thousands of members’ dues dollars, making him the 14th official to be found guilty in the federal investigation. Another former union president Dennis Williams, who has been implicated in the crime — though not formally charged —  just paid back $55,000 of “inappropriate travel expenses” to the union.

    The union’s finances over the past several years remain under scrutiny. Now, the UAW’s latest financial filing with the Department of Labor is publicly available — and it includes some eye opening expenses.

    According to the union’s 2019 LM-2 form, the UAW spent more than $2.3 million on legal fees related to the federal corruption investigation. This includes thousands of dollars spent defending now-convicted Jones, as well as Williams.

    The UAW has paid “more than $1.9 million to the Chicago law firm Cotsirilos, Tighe, Streicker, Poulos & Campbell since 2015,” when the federal investigation into the union started heating up. An itemized breakdown of the union’s legal expenses last year includes: $320,912 for Dennis Williams; $68,094 for Retired Secretary/Treasurer Gary Casteel; and $24,599 for Gary Jones.

    That’s not the only law firm the union has paid millions of dollars to in recent years. Since 2015, the UAW has paid DC-based law firm Bredhoff & Kaiser, PLLC almost $2 million. This is the same law firm the union hired to conduct an “independent” investigation into recent allegations of sexual harassment against UAW executive board member and regional director Richard Rankin. Based on the union’s history with Bredhoff & Kaiser, we’ve questioned how truly “independent” this investigation can possibly be. 

    To help explain some of its legal bills, the UAW holds that it’s “been the practice” of the union to cover legal costs for current and former leaders. We wonder if the UAW’s members will agree with the union using their hard earned dues money to defend the same union bosses that stole from them.  

    Categories: Crime & CorruptionUAW
  2. Labor Racket Weekly: Coronavirus Catch Up

    The coronavirus may have put some court proceedings on hold, but union bosses are finally seeing their own misdeeds catch up with them. Check out the latest labor rackets below:

    In Michigan, Gary Jones, former President of the United Auto Workers (UAW), pleaded guilty to one count of conspiracy to embezzle union funds and use a facility of interstate commerce to aid racketeering activity, in violation of 18 U.S.C. 371, 1952(a)(3), and 29 U.S.C. 501(c), and one count of conspiracy to defraud the United States, in violation of 18 U.S.C 371. During the course of the conspiracy, from at least 2010 and continuing through in or about September 2019, Jones embezzled and conspired to embezzle approximately $1,000,000 in union funds by submitting fraudulent vouchers to the UAW that misrepresented the destination and purpose of the expenses and by using unauthorized checks to divert funds from the UAW Midwest CAP.

    In New Mexico, Jessica Pangburn, former office secretary of Operating Engineers Local 953, was sentenced to one day of jail (time served), two years of supervised release, and 25 hours of community service. She was also ordered to pay restitution in the amount of $69,469. On November 26, 2019, Pangburn pleaded guilty to one count of wire fraud, in violation of 18 U.S.C. 1343.

    In West Virginia, Eric Childress, former Secretary-Treasurer of Communications Workers of America (CWA) Local 2276, was sentenced to five years of probation and was ordered to pay restitution of $30,611 and a $25 special assessment. On December 18, 2019, Childress pleaded guilty to one count of making a false entry in a union record, in violation of 29 U.S.C. 439(c).

    In Wisconsin, Linda Woodford, former President of American Federation of State, County and Municipal Employees Local 727D, pleaded guilty to one count of misdemeanor theft, in violation of Wisconsin State Statute 943.20(1)(b). She was then sentenced to five days in jail, one year of probation, and 50 hours of community service. She was also ordered to pay $453 in court costs; Woodford previously paid full restitution of $4,065.

    In Indiana, Rhondalyn Cornett, former President of the Indianapolis Education Association, pleaded guilty to one count of wire fraud for embezzling $154,118 from the union, in violation of 18 U.S.C. 1343. She was then sentenced to 16 months of incarceration and two years of supervised release. She was also ordered to pay restitution of $154,118 and a $100 special assessment.

    In Georgia, Janet Pilcher, former Secretary-Treasurer of National Association of Letter Carriers (NALC) Branch 536, pleaded guilty to embezzlement of union funds in the amount of $65,033, in violation of 29 U.S.C. 501(c).

    In Kentucky, Shannon Pemberton, former Treasurer for Painters Local 238, was sentenced to three years of probation and ordered to pay restitution of $958 and a $100 assessment. Pemberton previously paid $5,444 in restitution. On January 23, 2020, Pemberton pleaded guilty to one count of embezzling union funds in the amount of $6,403, in violation of 29 U.S.C. 501(c).

    Categories: Labor Racket WeeklyUncategorized
  3. Seattle’s Union-Backed Ordinance Would Hurt, Not Help Gig Workers

    Next week, Seattle’s City Council is expected to vote on an ordinance to create a premium pay requirement for gig workers. This potential law is supposed to provide relief for workers during the current health crisis, but a close look at the bill — and the organization backing it — indicates it could have just the opposite effect.

    The bill’s main proponent and promoter is Working Washington (WW), an organization that acts as a front group for prominent labor unions. The Service Employees International Union (SEIU) is joined by the United Food and Commercial Workers (UFCW) and the Teamsters in funding WW’s latest objective: Organizing gig workers.

    Before the group targeted the gig economy, its main objective was organizing restaurant workers in the city under the SEIU’s Fight for $15 campaign. The campaign, meant to incentivize unionization among restaurant workers, succeeded in helping pass a $15 minimum wage in Seattle in 2014, although it flopped in its main goal of unionizing the restaurant industry./

    Seattle employers and their staff have been paying for the $15 experiment ever since. One report found that, although mandated wages were rising, workers were earning $125 less a month as employers were forced to cut staff hours. Local restaurant owners had to lay off employees; still, they feared for the long term viability of their business. Other restaurants closed for good.

    One Seattle restaurant worker recently found herself out of a job after six years because her employer couldn’t bear the high labor costs. Looking for a new job was difficult, considering several other restaurants in town suffered a similar fate. And it wasn’t just restaurants — child care centers in the city were forced to cut jobs, reduce staff hours, and raise their tuition prices in response to higher wage mandates.

    Now, the geniuses who helped ruin Seattle’s restaurant scene have set their sights on the gig economy. The latest WW-backed Seattle ordinance would create a $5 per order premium pay requirement for each online delivery or transportation service with a work-related stop in Seattle. That means an additional $5 every time an Uber or Lyft driver drops off a customer, or a DoorDash or GrubHub worker makes a delivery.

    But the cost of an extra $5 per delivery, based on a union formula of $15 per hour (assuming three stops per hour), adds up quickly. What’s more, the legislation offers a threatening, vaguely authoritarian, and likely-illegal prohibition: “No hiring entity shall, as a result of this ordinance going into effect, reduce or otherwise modify the areas of the City that are served by the hiring entity.”

    Get that? Under Seattle’s law, it would be illegal for a business to leave the city to reduce its costs. You’re damned if you do, damned if you don’t. As the Wall Street Journal argued in a recent editorial: “There’s no free lunch. Gig economy companies are struggling amid the pandemic—Uber has laid off more than a quarter of its workforce—so their customers and workers in other places will pay the cost of the regulation.”

    Seattle’s workers face enough obstacles as it is. Passing yet another ordinance that makes it difficult to do business in the city only puts another hurdle in their way.

    Categories: Workers Center
  4. Union Push to Reclassify Workers in CA Could Result in 900,000 Jobs Lost

    As if workers didn’t have enough to deal with while trying to navigate the coronavirus pandemic, California has gone and made matters even worse. The state is suing rideshare apps Uber and Lyft for violating the state’s AB5 law by allegedly misclassifying workers as independent contractors, instead of employees.

    We’ve covered which unions are funding the lawyers behind this suit, but we haven’t discussed what will happen to gig workers if these attorneys — and their pals in the labor movement — actually get their way.

    A new report from the Berkeley Research Group found that “forcing app-based delivery and rideshare drivers to become employees would result in eliminating 900,000 jobs, reducing the number of drivers needed in California by 80 to 90 percent.”

    It turns out, 80 percent of drivers in CA work fewer than 20 hours a week, with most working less than 10 hours per week. That means when these workers are forced to become employees — and to comply with less flexible work schedules  — the number of app-based drivers “needed to satisfy consumer demand” will drop by 80-90 percent.

    Right now, over one million Californians use rideshare or delivery apps to make additional income. But if the state’s union-backed attorneys successfully reclassify all of these workers as employees, it could leave 900,000 CA workers without their gig.

    Organized labor’s front groups — led by “Gig Workers Rising” — criticized the study on Twitter, and pointed readers to a comforting counter survey from a researcher at UC-Santa Cruz. But that survey’s credibility is in doubt for several reasons:

    • Survey respondents were “recruited” through labor groups opposed to the gig companies;
    • The survey authors had no way to verify whether the person taking a survey was currently a gig worker;
    • Gig Workers Rising advertised the survey to its members to boost the respondent counts, even offering to pay them–and still wound up with a very small sample;
    • The author, Chris Brenner, has worked on past research projects with the sponsoring organization for Gig Workers Rising.

    It’s pretty rich to criticize as biased a study whose authors received industry support — and point readers to another study whose authors receive labor support.

    Drivers don’t seem to want what labor is selling. One gig worker who switched from ridesharing to delivery after the coronavirus hit had this to say about AB5 and the lawsuit: “These new laws and lawsuits that try to take away our freedom to choose flexible, independent work will kill jobs and take away chances to make money in the midst of an economic meltdown. It makes absolutely no sense.”

    Another worker who’s been using the gig economy as a way to pay for his college tuition mentioned the countless individuals who would be hurt by this change, including “students who need the flexibility to work around school schedules, working people who need to supplement income, seniors who want to work a few hours a week to support their retirement.”

    According to the Bureau of Labor Statistics, “79 percent of independent contractors preferred their arrangement over a traditional job.” But unions like the United Food and Commercial Workers (a long time supporter of the CA Attorney General bringing this lawsuit) don’t seem too concerned with what workers would prefer.

    Judging by labor’s support for AB5 — a law that has already cost thousands of Californians their jobs — the UFCW and other labor unions have no issue taking away opportunities or flexibility for CA’s gig workers, so long as they can increase their number of dues-paying members in the process.

    Categories: UFCW
  5. Labor-Backed Attorneys Target Uber and Lyft in Lawsuit

    This week, the state of California filed a lawsuit against ride-share companies Uber and Lyft. The lawsuit claims these gig companies are misclassifying workers as independent contractors under the state’s AB5 law. The suit was filed by California Attorney General Xavier Becerra; city attorneys from San Francisco, Los Angeles and San Diego joined in.

    Since unions can’t directly organize independent contractors, they’ve supported laws like AB5 that would reclassify thousands of these workers as employees. This lawsuit is just the next step in the battle these unions, and their conduits, are waging to organize the fast-growing gig economy. (At WorkerCenters.com, we’ve mapped the coordination between labor unions, the 501c4 groups they fund, and organizations such as the Gig Workers Collective.)

    It’s no wonder whose side these attorneys are on — each one involved in the suit against Uber and Lyft has a history of financial backing from labor unions.

    Let’s start with California Attorney General Xavier Becerra. Before he became AG, Becerra had a long stint as a Congressman. According to FEC filings and data available on OpenSecrets.org, Becerra received a total of $129,000 from the United Food and Commercial Workers (UFCW) during his time in the House of Representatives.

    During his run for AG, UFCW PACs donated a total of $59,700 to Becerra, including donations to his 2022 campaign. A list of re-election endorsements from UFCW leaders (below) speaks to Becerra’s popularity with the union. (It’s worth noting that the UFCW is one of the key unions funding Working Washington — a worker center dedicated to organizing workers in the gig economy.)

    This is in addition to the thousands Becerra has received from other labor unions, including the International Brotherhood of Electrical Workers (IBEW), the Service Employees International Union (SEIU), and the Teamsters.

    Across his campaigns for San Francisco city attorney, Dennis Herrera has received $17,000 from labor unions, including the IBEW, Teamsters, and the Transport Workers Union of America. Similarly, Los Angeles City Attorney Mike Fueur has received over $10,000 from labor unions during his campaigns for city attorney, including donations from the SEIU and the Los Angeles Building and Construction Trades Council.

    San Diego City Attorney Mara Elliott, who filed her own lawsuit against a gig company last year, received $162,407 in independent expenditures from labor unions during her 2016 campaign. She also received over $20,000 from Policy Action PAC (shown below)– a PAC that received $5,000 from SEIU Local 221 that same year. Unions also spent $28,001 in independent expenditures against Elliott’s opponent. So far, Elliott’s 2020 campaign has been endorsed by the Democratic Party of San Diego and the San Diego-Imperial Counties Labor Council, which receive significant support from UFCW locals.

    Union’s have spent big to support their friends in high places, and it looks like their efforts are paying off. But AB5 has already cost thousands of workers their jobs in California. During the coronavirus pandemic — when millions have found themselves unemployed — is going after one of the few industries that’s still hiring really what’s best for workers?

     

    Categories: Gig WorkersUFCWWorkers Center
  6. SEIU-Backed Worker Center Targets Postmates

    The Service Employees International Union (SEIU) is in the midst of a corporate campaign against Chipotle. Last year, New York City-based SEIU local 32BJ ramped up its Fight for $15 movement to organize workers at the burrito chain’s locations in the city. And that’s just the latest iteration of the union’s partnership with the Fight for $15. Over the years, the SEIU has poured millions of dollars into this national campaign to raise the minimum wage and organize fast-food restaurant employees.

    The coronavirus may have stunted the union’s on-the-ground efforts for the time being, so it’s not surprising that the SEIU has turned to its trusted (and funded) worker center Working Washington (WW) for help. What is surprising: That WW would use its gig worker organizing efforts to launch a second front against Chipotle.

    This week, WW is calling for a three day long #GuacOff where Postmates delivery workers are asked to ignore any Chipotle orders that come in. The strike follows a partnership between Chipotle and Postmates that gives customers free delivery during the crisis. Through its Payup.wtf campaign platform, WW has advertised the strike as a way for workers to “demand sick leave, hazard pay, and safety protections” from Postmates.

    Considering WW’s close relationship with the SEIU, it seems this “GuacOff” has the added benefit of going after one of the SEIU’s top targets, if only indirectly. According to financial filings with the Department of Labor, the SEIU has given almost $20 million to WW over the last several years. Since 2017 alone, the worker center has received over $1.7 million from labor unions overall. As union membership continues to decline, labor leaders have increased efforts to organize the gig economy. WW and other gig economy-focused worker centers provide the perfect front — it seems they can even kill two birds with one stone when it comes to doing the SEIU’s bidding.

    The #GuacOff is just one of the many gig-worker strikes WW and its conduits are planning for this week. However, if the outcome is anything like their efforts to strike last month, we’d bet Postmates — and Chipotle — don’t have too much to worry about.

    Categories: Gig WorkersSEIU
  7. Coronavirus Response Bill Includes Handout for Labor Unions 

    Congress finally passed phase three of its coronavirus relief package, known as the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The bill provides much needed financial assistance for U.S. businesses that have been hardest hit by the coronavirus outbreak, as well as direct relief to individuals and families. But it’s not without a catch.

    The CARES Act allows businesses employing between 500 and 10,000 employees,to apply for a direct loan from the Treasury Department. (It’s worth noting these are not the Small Business Administration loans for smaller businesses that are also provided by the bill.)

    If a business accepts one of these loans (which are not forgivable), it is then required to “make a good-faith certification that the recipient will remain neutral in any union organizing effort for the term of the loan.”

    But it’s unclear when the word “neutral” will come into play. For instance, it could come into effect after a union petitions for an election, when representation cards are first being solicited, or when a union notifies management of their intention to represent employees. The definition is not established by the law. Therefore, it will be up to the interpretation of the National Labor Relations Board (NLRB), the Department of Labor, or the Treasury Department.

    Typical neutrality agreements stipulate that unions can organize via card check — bypassing secret ballot elections to authorize union representation. However, those are agreements that employers voluntarily agree to for various reasons and do not apply here.

    The neutrality requirement has nothing to do with mitigating the effects of the coronavirus, and everything to do with restoring power to labor unions that have seen a continued drop in membership — especially in the private-sector. Consider how auto workers at the Volkswagen plant in Chattanooga, TN might have fared if their plant had been subject to a similar neutrality provision. These workers recently voted to reject the United Auto Workers (UAW) — a union that remains tied up in a federal corruption investigation in which its former president and 13 other officials have been charged. Plant employees certainly dodged a bullet by voting “no” to unionizing. But under this new stipulation, countless workers may end up shackled to the UAW or a similarly corrupt union.

    It’s shameful that union officials and their political allies in Congress would use a legislative response to a global health crisis as a way to promote Big Labor’s agenda.

    Categories: UAW
  8. The Gig Worker “Strike” That Wasn’t

    To listen to Vice tell it, Monday’s planned gig worker “strike” was the country’s biggest labor action since the 1936 General Motors workers sit-down in Flint, Michigan:

    Instacart shoppers are planning a nationwide mass revolt over the grocery delivery app’s response to the coronavirus pandemic. … The March 30 walkout will build on a wave of wildcat strikes sweeping across the country …  leading to calls for a “general strike,” or mass strike action across the country.

    USA Today reported that more than 150,000 Instacart shoppers and customers would “walk off the job” today. (It’s unclear how a gig worker who doesn’t gig, or customer who decides not to use the app, can “walk off” a job–but set that aside.) Meanwhile, TechCrunch said that online retail giant Amazon would face a “bevy” of strike activity today. 

    The strikes are part of a larger labor union campaign to organize these workers and turn them into dues-paying members. But if you strained to see the impact of the so-called strike on Monday, you’re not alone.

    Axios reported that the strike had “absolutely no impact” on Instacart’s operations, citing a statement from the company. Relative to this time last week, the “platform had 40% more workers on it…” That’s basically the exact opposite of what a successful strike should accomplish.

    Independent verification of this was visible around the country. In Lancaster County, PA, for instance, one local reporter found that the service was “operating normally.”  In central Oregon, a group of Instacart shoppers took to local media to confirm that they would not be participating in the strike, and viewed being an independent contractor as a perk of the job rather than a drawback.

    Amazon’s antagonists didn’t fare much better: The company confirmed that just 15 people out of a workforce of 5,000 participated in the Staten Island demonstration”–a participation rate of less than one percent. 

    Unions have struggled in recent years to reverse membership declines in the private-sector, and view the tech industry as fertile ground. But if today’s poor showing is any indication, the workers don’t want what the union is selling.
    Categories: Gig WorkersWorkers Center