Labor Pains: Because Being in a Union can be Painful

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  1. Labor Racket Weekly: Spring Roundup

    The seasons may have changed since our last labor racket check in, but these union bosses sure haven’t. Below, check out some of the latest rackets from the last month.

    In California, Stephen Rooze, former Secretary-Treasurer of the Brotherhood of Locomotive Engineers and Trainmen (BLET) Division 662, was charged in a four-count indictment for embezzling $140,064 in union funds.

    In Michigan, Brian Rittenhouse, former Financial Secretary of United Auto Workers (UAW) Local 1320, pleaded guilty to one count of embezzlement.

    In Illinois, Milton Thomas, former shop chairman of United Auto Workers (UAW) Local 890, pleaded guilty to one count of forgery. He was then sentenced to two years of probation. He was also ordered to avoid contact with UAW Local 890 and Xylem Corporation, to submit to DNA indexing, and to pay a $75 fine.

    In Pennsylvania, Gregory Fiocca, a member of International Brotherhood of Electrical Workers (IBEW) Local 98, was charged in an indictment with one count of conspiracy to commit extortion, 18 counts of extortion, and aiding and abetting.

    In Pennsylvania, John Dougherty, Business Manager of International Brotherhood of Electrical Workers (IBEW) Local 98, was charged in an indictment with one count of conspiracy to commit extortion, 18 counts of extortion, and aiding and abetting.

    In Michigan, Fiat Chrysler Automobiles US LLC (FCA), pleaded guilty to one count of conspiracy to violate the Labor Management Relations Act (LMRA). FCA knowingly joined a conspiracy whereby it paid and delivered over $3.5 million in money and things of value to officers and employees of the United Auto Workers (UAW), located in Detroit, Mich., from 2009 through 2016. The prohibited payments and things of value included the payment of approximately $262,000 to satisfy the outstanding mortgage on the residence of former UAW Vice President General Holiefield, $25,000 for a party for former UAW Vice President Norwood Jewell, and over $30,000 in meals for UAW officials at various restaurants in Palm Springs and Southern California.

    In Maine, Jeffrey Phillips, former Secretary-Treasurer of International Association of Machinists and Aerospace Workers (IAMAW) Local Lodge 836, was sentenced to two years of probation. He was also ordered to pay $57,611 in restitution, a $2,400 fine, and a $100 special assessment. On February 27, 2020, Phillips pleaded guilty to taking and carrying away personal property within the special territorial jurisdiction of the United States in the amount of $57,611.

    In New York, Donald Snyder, former President of International Association of EMTs and Paramedics, affiliated with the National Association of Government Employees (NAGE) Local R2-394, was charged in a criminal complaint with embezzlement of union funds in the amount of $94,649, false reports required to be filed by the Secretary of Labor, and false entries in union records.

    Categories: Labor Racket Weekly
  2. Should Sectoral Bargaining Come to the U.S.? New Report Says “No.”

    Sectoral bargaining is gaining support among top Democrats, including President Joe Biden, as a way to set wages, working conditions, and benefits for entire industries, often by union-controlled boards ─ even for those companies whose workers have rejected unionization. It’s also the latest policy being pushed by organized labor and its allies in academia and Congress.

    But is it a good idea?

    According to a new report from the Institute for the American Worker (I4AW), the answer is a resounding “no.” The Institute just released a comprehensive report on sectoral bargaining that outlines plenty of potential downsides to this system, which is already in play in Europe.

    For one, it strips away wage competition — meaning it’s harder for employees to get higher wages. When a wage standard is set across an industry, employees can’t try to get a raise by switching from one employer to another. Employers also have no incentive to attract the best employees by outbidding their competition. It would also mean higher prices for consumers as a result of less competition.

    Sectoral bargaining would also lead to less choice for workers. Many of the existing plans for sectoral bargaining call for unions representing just 10 percent of an industry. As a result, a minority of workers could select representation for everyone else. Sectoral bargaining could also hurt small businesses, since market share might determine how much of a say a company gets in negotiations with unions. This means larger companies would be calling the shots, while smaller businesses and their employees would have little say in negotiations.

    But this system could have the most profound impact on gig workers. Unions would be able to set wages and benefits for all gig workers, regardless of platform. Freelancers, the majority of whom prefer the flexibility they have as an independent contractor rather than a full-time employee, could suddenly find their livelihood controlled by a union they didn’t even vote for. Of course, this would likely lead to bargaining requirements for unions and, as a result, massive amounts of dues money for organized labor.

    Sectoral bargaining would “completely cut against the democratic grain of unionization in America.” For the sake of American workers, legislators should reject this system that would “enhance union power and finances at the expense of workers.”


    Categories: Gig Workers
  3. PRO Act Would Threaten The Freedom of Millions of Independent Contractors

    Congress is currently considering the latest iteration of the Protecting the Right to Organize Act (PRO Act) — a bill that reads more like a labor union wishlist than a serious piece of legislation. Still, unions are hopeful that a Democrat-controlled Congress and President Biden — who has expressed support for the bill — will finally get the PRO Act across the finish line. But if this happens, it would be a disaster for workers nationwide.

    For starters, the bill would override right-to-work laws in 27 states across the country. This means workers would be forced to contribute financially to a union as a condition of their employment. The PRO Act would also allow unions to bypass secret ballot elections in favor of “card checks.” During card checks, workers are persuaded to sign a card that authorizes union representation. Since the system is largely unregulated, it opens workers up to peer pressure, intimidation, and coercion.

    Perhaps one of the PRO Act’s most dangerous provisions is its attempt to copy language from California’s misguided AB 5 law. This law has threatened the livelihoods of countless freelancers in the state by reclassifying them as “employees” instead of as “independent contractors.” The PRO Act would seek to do the same on a national scale.

    But the success of Prop 22 in California — a recently passed ballot measure that allows certain gig workers to be exempt from AB 5 — proved that voters believe actual workers, not the government, should have control over how they earn a living. Of course, labor unions and their allies fought against Prop 22. Their goal was to preserve the new status quo that made it easier to classify workers as “employees,” making them easier organizing targets.

    But gig workers — who by a four to one margin prefer their current status to becoming full-time employees —  won out in the end. Unfortunately, the proposition didn’t apply to thousands of freelancers who work outside the gig economy and who are still struggling to navigate AB 5.

    As the country works to recover from the massive job losses caused by the COVID-19 pandemic, now is not the time to make it more difficult for Americans to earn a living. We can’t afford to repeat California’s mistake by threatening the freedom of millions of independent contractors.

    Categories: Gig WorkersPRO Act
  4. Progressive Leader Calls Out Chicago Teachers Union’s Push To Keep Schools Closed

    Teachers unions across the country have fought to keep schools closed, and students stuck at home during the pandemic. Despite a growing body of research that shows schools can reopen safely, the Chicago Teachers Union (CTU) has been one of the loudest voices against reopening. But even Democrats — usually union allies — are getting sick of teachers unions pushing to keep students out of the classroom.

    After reaching a tentative deal with the teachers union, Chicago Mayor Lori Lightfoot gave an interview with the New York Times where she opened up about how the union’s antics were hurting students.

    Mayor Lightfoot acknowledged what experts have been saying for months: “social life has been completely torn from so many of our young people. Our 3-, 4-, 5-year-olds? Their social-emotional learning is absolutely central to their growth, and yet we see them learning on screens.”

    Still, the union fought tooth and nail to avoid getting back in the classroom, even while Chicago Public Schools (CPS) were trying to move forward with safe and coordinated reopening plans. Caught in the middle of this battle were countless students, and their parents, who were being denied access to in-person learning.

    Putting students’ best interests second to its own is nothing new for the union. In 2019, CTU members walked off the job for a ten-day strike. The city rewarded them for this stunt, agreeing to a “five-year contract that included a 16-percent pay hike.” The average full-time CPS teacher made over six figures in 2020 including benefits. This time around, CTU had the coronavirus pandemic as an even bigger bargaining chip and was quick to use it to the union’s advantage.

    But many private schools in the area have been open for months with relatively low coronavirus infection rates. One parent even pulled his child from the CPS system after watching his “5-year-old daughter struggle during remote learning.” He saw her falling behind other kids who had access to in-person learning, including some at Chicago’s Catholic and private schools. Other parents faced similar struggles. As Mayor Lightfoot noted, “many students were suffering from depression and isolation” and their grades were also suffering.

    In the words of Mayor Lightfoot, “When you have unions that have other aspirations beyond being a union, and maybe being something akin to a political party, then there’s always going to be conflict.” She suggested looking at the union’s spending to see what their real priorities are — hint, it doesn’t look like it’s delivering the best education for students. In fact, Lightfoot went on to say she speculated the union’s ultimate goal is to “take over not only Chicago Public Schools, but take over running the city government.”

    Whether or not that’s true, one thing is certain: By fighting to keep students home, the CTU has put the education and development of thousands of students at risk.


    Categories: AFT
  5. Labor Racket Weekly: New Year, Same Union Corruption

    The New Year usually means a fresh start — but not for these union bosses. Check out the latest labor rackets from 2021:

    In New Jersey, Dorothy McBride, former President and Fund Administrator of Communications Workers of America (CWA) Local 81427, was charged in a criminal complaint with one count of embezzlement of labor union assets in the amount of $100,000 and one count of embezzlement from an employee benefit plan in the amount of $534,470.

    In Michigan, Edward “Nick” Robinson, former President of the United Auto Workers (UAW) Midwest CAP Council, was sentenced to one year in prison and one year of supervised release. He was also ordered to pay a $200 special assessment. Restitution will be determined at a later date. On March 2, 2020, Robinson pleaded guilty to one count of conspiracy to embezzle approximately $1,500,000 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. Robinson also pleaded guilty to one count of conspiracy to defraud the United States for failing to report over $1,500,000 in income on the IRS Form 990 returns filed by the UAW and UAW Midwest CAP and for failing to report the income on his Form 1040 tax returns filed with the Internal Revenue Service.

    In Michigan, Fiat Chrysler Automobiles US LLC (FCA), located in Detroit, Mich., was charged in an information with one count of conspiracy to violate the Labor Management Relations Act (LMRA), in violation of 18 U.S.C. 371. FCA was charged with knowingly joining a conspiracy whereby it paid and delivered over $3.5 million in money and things of value to officers and employees of the United Auto Workers (UAW), also located in Detroit, Mich., from 2009 through 2016. The prohibited payments and things of value included the payment of approximately $262,000 to satisfy the outstanding mortgage on the residence of former UAW Vice President General Holiefield, $25,000 for a party for former UAW Vice President Norwood Jewell, and over $30,000 in meals for UAW officials at various restaurants in Palm Springs and Southern California.

    In Pennsylvania, Donald “Gus” Dougherty, owner and operator of Dougherty Electric, Inc., an employer of International Brotherhood of Electrical Workers (IBEW) Local 98, pleaded guilty to one count of making and subscribing to false federal income tax returns and one count of theft from employee benefit plans.

    In New Jersey, Linda Rogers, former Secretary-Treasurer of American Federation of State, County and Municipal Employees (AFSCME) Local 225, pleaded guilty to count one of embezzlement of union funds. Between July 2016 and August 2017, Rogers’ daughter Jennifer Rogers, former member of AFSCME Local 2254, illegally wrote 111 checks to Linda Rogers and deposited them into their joint checking and savings account. Linda Rogers also wire transferred union funds from the union’s savings account to her personal credit card. The total loss to the union was approximately $40,455.

    In Michigan, Brian Rittenhouse, former Financial Secretary of United Auto Workers (UAW) Local 1320, was indicted with one count of embezzlement and one count of false entry in a record required to be kept by a labor organization.

    In Missouri, Scott E. Rodgers, President of National Postal Mail Handlers Union (NPMHU) Local 314, was charged with one count of embezzlement and theft of labor union assets, totaling $80,765.

    In California, John S. Romero, former President of United Industrial Service Workers of America (UISWA), was sentenced to 12 years of imprisonment and three years of supervised release, and he was ordered to pay a $1,400 special assessment. Romero was also ordered to pay restitution in an amount to be determined at a later hearing. On February 12, 2020, after a six-day trial, a jury found Romero guilty of one count of conspiracy, 12 counts of theft of approximately $800,000 in connection with health care, and one count of filing a false financial report with the Department of Labor, in which he failed to properly report the existence of more than $100,00 in receipts and disbursements.

    In Michigan, Hasan Zahdeh, President of Michigan Union of Healthcare Workers (MUHW), was indicted for embezzlement of union funds. On December 11, 2020, a criminal complaint, along with an arrest warrant, was filed against Zahdeh alleging an embezzlement of union funds of at least $15,640.

    Categories: Labor Racket Weekly
  6. Labor Group Infighting Over Dumpling’s Allegedly Duplicitous Nature

    Time and time again, we are reminded that few things are certain except death, taxes…and civil wars within labor movements.

    This latest scuffle occurred within the ranks of the Gig Workers Collective (GWC). The relatively young organization is committed to targeting and organizing shoppers on grocery delivery platforms such as Shipt and Instacart. GWC members have often pointed shoppers to a competitor called Dumpling, which bills itself as an “ethical” competitor. But a new Vice article revealed that Dumpling might be a bit stale. What’s more, a one-time prominent GWC member and representative of workers is now siding with management in the fight.

    According to Vice, Dumpling misled its shoppers, which it calls “business owners,” about how much autonomy and power they actually have on the platform. The truth became apparent after Dumpling changed its pay model in the second half of 2020. As the year went on, Dumpling increased prices and removed features.

    The app announced new monthly plans that charged business owners credit card processing fees of up to 3.9 percent per order, and higher fees for monthly subscriptions to its services. But the greatest pushback came in November, when Dumpling removed a popular feature that allowed business owners to set their own tipping minimums.

    As the changes increased, so did the company’s censorship of its Facebook group.  According to one shopper quoted in the article, “If someone didn’t like the new changes and spoke out in the Facebook group, their comments would be muted, not approved, or they would be kicked out of the group.” The situation came to a head when Dumpling deleted the Facebook group completely.

    Further details about the situation were revealed by GWC leader Vanessa Bain after she posted a series of Dumpling-critical tweets revealing that GWC tried to moderate between the company’s leadership and several “business owners.”

    The most interesting detail in the article is the change in tone of Matthew Telles. Telles, an early GWC member, appeared to be a de facto spokesperson for the group on several occasions dating back several years. Via the Chicago Tribune, Telles even earned himself the title of “chief agitator” against the delivery companies.

    Today, Telles is whistling a different tune. He was an early supporter of Dumpling and told TechCrunch last summer that “Dumpling is now my career.” He’s sure acting like management: In the Vice article, Telles defended the company’s decision on a new tipping policy, and on social media he lashed out against his former GWC comrades:

    While the situation seems far from over, it appears that the Gig Workers Collective isn’t so collective after all.

    Categories: Workers Center
  7. Report Gives Union Members Insight Into 20 Years of Labor Finances

    This month, the Office of Labor-Management Standards (OLMS) released a new report that analyzes union financial data between 2000-2019. While OLMS has collected information on union spending annually for years, this report allows members to see overall trends in how unions use their resources — mainly members’ dues dollars. 

    The country’s major labor unions — meaning unions that take in $250,000 or more in total annual receipts — collected a whopping $10 billion in dues in 2019 alone. Of these dues, $1.4 billion went to per capita tax — the amount of money local unions collect from members and kick up to their parent union. About $3.75 billion — less than half — went to representational activity overall. The average union collected almost $2.5 million in dues in 2019, and spent around $900,000 on representational activity — roughly 36 percent.

    Labor union membership has declined in recent years, primarily in the private-sector. But in 2019, that didn’t stop these larger unions from hitting their highest dues payment intake in 20 years. Meanwhile, average union membership that same year was similar to what it had been in 2011. It was certainly down from the average membership highs seen in 2014 and 2015. The data suggests that while union dues payments continue to rise more or less consistently, membership doesn’t. Translation: the price of union membership is going up, but less workers are interested in paying for it.

    The report also provides an overview of the criminal enforcement actions taken by OLMS between 2000-2019. That includes over $156.3 million dollars of restitution OLMS has collected in over 2,100 criminal cases. During that same time period, OLMS investigations led to 2,297 indictments and 2,166 convictions.

    Let’s not forget that some of the same bad actors involved at the scandal at the United Auto Workers (UAW) were counted among those criminal actions. Volkswagen workers in Chattanooga were right to be skeptical about the type of bang they’d get for their buck if they voted to join the UAW. With this added transparency into union spending, more workers will be able to decide for themselves if the price of union membership is actually worth it.


    Categories: Crime & CorruptionDOL
  8. Biden Admin Wastes No Time Capitulating to Union Interests

    Yesterday, Joe Biden was officially sworn in as the 46th president of the United States. He wasted no time capitulating to some of his biggest supporters — labor unions.

    After taking office, President Biden immediately threatened to fire National Labor Relations Board (NLRB) General Counsel Peter Robb. In an unprecedented move, Robb was given the option to resign by the end of the day, or be terminated.

    It’s no secret labor unions have pushed for Robb’s removal. A report by the Washington Free Beacon notes that the “Service Employees International Union (SEIU), which spent nearly $25 million on the 2020 elections, privately lobbied the Biden transition team to sack Robb upon taking office.” The union had sent a memo to Biden’s transition team in December calling for Robb’s removal. The Communications Workers of America also joined the push to oust Robb. When it was all over, the SEIU’s Fight for 15 movement applauded the move, tweeting “Good riddance. Now he’s [Robb] gone.”

    But Robb was confirmed for a four year term by the Senate — a term that wasn’t set to expire until next November. Furthermore, a president has not demanded the resignation of the NLRB general counsel in over half a century — even when a different political party has taken power at the White House. There’s concern that this unprecedented move could “threaten the agency’s independent status.”

    There’s also concern about the hypocritical message Robb’s termination sends. After all, the call for his resignation came barely an hour after Biden gave an inaugural address that called for “unity” between political parties. In response, Robb wrote:

    “It was my understanding that the incoming administration intended to foster civility and unity in this country and in the governing of this country, promising to adhere to the rule of law and enabling its chief law enforcement officers the independence, free from White House interference, to enforce the laws of the United States. A presidential removal of the NLRB’s General Counsel prior to the expiration of his or her term violates these promises and principles.”

    It’s remarkable, though perhaps not surprising, that one of Biden’s first actions as President was to start granting union wishes. Unfortunately for workers, it looks like kowtowing to labor interests will be the norm for the Biden administration. 

    Categories: NLRBSEIU