Labor Pains: Because Being in a Union can be Painful

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  1. “Culture of Corruption” at UAW Documented by New Website

     In light of the recent guilty plea from ex-UAW Vice President Norwood Jewell, the Center for Union Facts has created a new website www.UAWInvestigation.com. The site is the latest phase of an on-going campaign to hold the UAW accountable for corruption and anti-worker tactics.

    A full page print ad promoting the site ran in three papers: The Detroit News, Detroit Free Press and the Chattanooga Times Free Press. The ad highlights what the Justice Department has described as a “culture of corruption in the senior leadership” of the UAW.

    This critique stems from an ongoing federal investigation. Four high-ranking union officials pleaded guilty to funneling money away from workers and into their own pockets. Former UAW President Dennis Williams has also been implicated in the scandal for allegedly OK’ing the use of union training funds to pay for lavish meals and travel.

    But that’s not the end of the union’s woes. The site also details a luxury cabin constructed for Williams that was bankrolled with interest from the union’s strike fund—and built with non-union labor.

    Even the UAW’s own members admit the union has a problem with its leadership. It seems workers’ “justified doubts about joining and paying into” the UAW have finally come back to bite the union. Last year, the UAW saw a drastic drop in membership—the steepest decline since the Great Recession.

    The union has already paid over $1.5 million of members’ dues to cover legal representation during the investigation—but no amount of money will change the facts.

    Anyone who thinks the UAW has workers’ best interests in mind should think again.

    Categories: UAWUncategorized
  2. New Site Tracks $1.5 Billion in Public Union Political Spending

    On Monday, the Center for Union Facts launched a new project www.PublicUnionFacts.com. The first of its kind, the website compiles 20 years of data on public-sector union political spending in one place. The site includes over 385,000 political contributions from nearly 5,000 labor unions.

    Unlike most private unions, public-sector unions are not currently required to file financial disclosures with the Labor Department. The best source of information on public-sector union spending habits is its political giving. Unfortunately, this information is often spread across multiple difficult-to-access state databases. With PublicUnionFacts.com, employees can simply type in the name of their union to find its political spending history.

    The site also highlights the disproportionate amount of member dues unions have sent to Democratic causes over the last 20 years. Of the $1.5 billion that was sent directly to Republicans or Democrats, 90 percent went to Democrats with only 10 percent going to Republicans. Additionally, Democrats in just five states—California, New York, Illinois, Pennsylvania, and Oregon—received more money from public unions than Republicans did nationwide.

    After the Supreme Court’s landmark decision in Janus vs. AFSCME, public-sector union members are no longer forced to financially support their union as a condition of employment. Now, workers can choose to keep the portion of their dues that would have gone to support predominantly left-leaning causes. In fact, early data from the Labor Department shows many workers are doing just that.

    There is a growing disconnect between how unions are spending money and what workers really want. Now, with access to more facts, employees can start to hold their representatives accountable.

    Categories: Center for Union FactsUncategorized
  3. The Employee Rights Act is Back

    Last week, Representative Phil Roe, M.D. (R-Tenn.) reintroduced the Employee Rights Act (ERA). The bill, which garnered over 180 co-sponsors in the last Congress, would bring our current labor law into the 21st century by providing protections for the 7.6 million private-sector union members in the U.S.

    Right now, about 40 percent of union certifications bypass the secret ballot election. This means union leaders can hold public votes, relying on coercion and intimidation to maintain the status quo. To combat these scare tactics, the ERA would ensure secret ballot elections—a method over 80 percent of union households support. It would also guarantee periodic recertification votes to make sure current union members actually get the chance to vote for their representation.

    The ERA would bring much-needed reform to the process by which unions can deduct members’ dues from their paychecks and use them to support political causes. Right now, dues are automatically withheld from workers’ paychecks. While employees can request a refund, the method for doing so is often vague and arduous. The ERA would put an end to this out-dated process by instead requiring workers to opt in to making dues payments that go to support their union’s political agenda.

    This is good news for the 40 percent of union households who vote Republican in any given election, even though unions have given over $1.3 billion dollars—or 99 percent of their total political spending—to liberal groups and causes.

    As Rep. Roe put it, “The ERA will restore workers’ faith in unions because it is neither pro- nor anti-union. It will simply make unions more accountable to the workers they serve.”

    It’s time for Congress to get on board with the over 70 percent of Americans who support the ERA’s provisions.

    Categories: Employee Rights Act
  4. UAW “Flower Funds” are the Latest in Union Corruption Scandals

    Once again, the United Auto Workers has found itself in hot water. Federal investigators have launched a probe into the union’s so-called “flower funds.” Allegedly intended to collect money to provide flowers at the funerals of auto makers, these funds may have a more nefarious purpose.

    Investigators are looking into the possibility that senior UAW officials who control the funds—including presidents, vice presidents, and regional directors—were threatening high level staff into contributing to them. If these staff members refused to donate, they could fear being demoted back to the assembly lines. Even worse, it looks like UAW officials were funneling money from the flower funds into their own bank accounts.

    Let’s not forget that this investigation is just the latest probe in an ongoing corruption scandal at the union. Last year, federal investigators found that over $9 million was funneled to UAW officials through the union’s training centers. Fiat Chrysler Automobiles (FCA) officials bribed UAW staff with extravagant vacations and presents, including “a $30,000 party for a UAW official, complete with ultra-premium booze, $7,000 worth of cigars and $3,000 in wine with custom labels honoring the union boss.” So far, this probe has resulted in the conviction of seven high ranking UAW and FCA officers.

    To make matters worse, during the investigation the union was constructing a luxury cabin in Michigan for former UAW president Dennis Williams–who was also implicated in the scandal. Williams’ residence was financed with money from the union’s $721 million strike fund—which is funded by worker dues. To top it all off, the cabin was built using non-union workers.

    Erik Gordon, a professor at the University of Michigan, explained how the flower funds scandal could be the final straw for UAW employees: “This positions the union not as the workers’ friend but as a big powerful thing that would extort money from its own members.”

    Any union looking for an example of “what not to do” need look no further than the UAW. Members would be wise to take notice.

     

    Categories: UAW
  5. Ex-LIUNA Employee Comes Out Against Union “Culture of Mismanagement”

    A LaborPains post from December 2017 stated that Roderick Bennett, former Chief of Staff for the Laborers International Union of North America (LIUNA) was charged with “one count of embezzling $141,335 from the union.” Since then, Bennett has plead guilty to this charge. He has also volunteered new information regarding what he describes as an “extremely loose and lax ‘fiduciary management environment’ that has long existed within the union’s leadership team.”

    According to a press release from the public affairs firm representing Mr. Bennett, the former LIUNA employee “wishes to ‘go public’ with what he knows to be inappropriate behavior on the part of his former colleagues with regard to the use of the LIUNA-issued credit card.” 

    Bennett provided statements for this credit card—spanning from January 2014 to December 2016—that denote personal expenses made by union officers. From lavish steakhouse dinners to international travel for non-employees, below are some of the most egregious purchases:

    • William Bergfeld April 9, 2016, Joe’s Stone Crab purchase of $4,491.48 in the District of Columbia
    • William Bergfeld May 5, 2016, Best Buy purchase for $4,769.97
    • Armand Sabitoni  February 18, 2015 purchases of Hilton Hotel services totaling $3,456.91
    • Armand Sabitoni  May 21, 2015, purchase of four airline tickets to Rhode Island costing a total of $1,972.20
    • Sandra Khoury November 11, 2014, Bobby Van’s Steakhouse purchase for $11,515.52
    • Sandra Khoury, July 14, 2014, purchase of an airline ticket to Germany (for someone named Sylvia Khoury, believed not to be a LIUNA employee) for $1,874.50
    • Sandra Khoury, July 14, 2014, purchase of a second airline ticket to Germany (for someone believed not to be a LIUNA employee) for $1,874.50

    Apparently, it was common practice for employees to put expenses, both personal and business, on the union credit card in order to earn American Express points. Since there was no protocol for how these points were spent, employees would then use them freely.

    Bennett admits to participating in this system, but claims the “federal government should be looking at the entire culture of mismanagement that was occurring at the union.” It’s unclear whether or not this information will result in a separate investigation, but this insight into LIUNA’s questionable financial practices should be a red flag for union members. 

    Categories: Uncategorized
  6. Labor Racket Weekly: IBEW Edition

    The International Brotherhood of Electrical Workers (IBEW) Local 98 faces several charges of conspiracy, embezzlement, and fraud after an FBI investigation led to the indictment of Philadelphia’s most notorious union boss Johnny “Doc” Dougherty and members of his crew.

    Below are some of IBEW’s latest rackets and the recent sentencing for Rocco Fazzolari of NY, who plead guilty to embezzling union funds back in September:

    In Pennsylvania, John Dougherty, Business Manager of IBEW Local 98 was charged in an indictment with one count of conspiracy to embezzle from a labor union and employee benefits plan, 34 counts of embezzlement of union funds, 23 counts of wire fraud theft from the union, two counts of wire fraud theft from political action committee, two counts of filing a false LM report, two counts of falsifying union records, five counts of filing false federal income tax returns, one count of conspiracy to accept unlawful payments from an employer, eight counts of accepting unlawful payments from an employer, one count of conspiracy to commit honest services fraud and federal program bribery, 11 counts of honest services wire fraud, and one count of honest services mail fraud.

    In Pennsylvania, Brian Burrows, President of IBEW Local 98 was charged in an indictment with one count of conspiracy to embezzle from a labor union and employee benefits plan, 14 counts of embezzlement of union funds, two counts of filing a false LM report, two counts of falsifying union records, and five counts of filing false federal income tax returns.

    In Pennsylvania, Michael Neill, Apprentice Training Director of IBEW Local 98 was charged in an indictment with one count of conspiracy to embezzle from labor union and employee benefits plan, four counts of embezzlement of union funds, one count of theft from an employee benefit plan, and four counts of filing false federal income tax returns.

    In Pennsylvania, Marita Crawford, Business Agent and Political Director of IBEW Local 98, was charged in an indictment with one count of conspiracy to embezzle from a labor union and employee benefits plan, four counts of embezzlement of union funds, three counts of wire fraud theft from the union, two counts of wire fraud theft from political action committee, one count of filing a false LM report, and one count of falsifying union records

    In New York, Rocco Fazzolari, former President of the International Brotherhood of Trade Unions Local 122 (an independent union located on Long Island, N.Y.), was sentenced to 37 months in prison and three years of supervised release, and he was ordered to pay $1,288,810 in restitution. On September 26, 2018, Fazzolari pleaded guilty to embezzlement of union funds, embezzlement of benefit plan funds, and conspiracy to embezzle plan funds.

    Categories: Crime & CorruptionLabor Racket Weekly
  7. Did Unions Drive Amazon Out of NYC?

    Mayor Bill de Blasio claims that Amazon’s tragic break up with NYC was simply “scuttled by a few very powerful people sitting in a boardroom in Seattle.” But it takes two to tango and de Blasio would be wise to consider what the city—or more specifically, what the city’s labor unions—did to push Amazon away.

    Even after Amazon made concessions to the city’s most prominent unions, including promises to hire an estimated 5,000 unionized construction workers, some unions still demanded more. As the American Prospect recently reported, “The AFL-CIO, the Teamsters and the Retail, Wholesale, and Department Store Union (RWDSU) were intent on using Amazon’s New York ambitions as a way to get a union inside Amazon.”

    Stuart Applebaum, President of RWDSU, along with the AFL-CIO and Teamsters, called on Amazon to agree to a neutrality pledge, which would allow 2,500 workers to organize at the retail giant’s new location.

    But some unions weren’t on board. 32BJ, an SEIU local in NYC, worried that the unions’ continued demand for neutrality “could fan the anti-Amazon flames” and encourage the company to pull out of the deal. Someone should tell Applebaum that if your tactics are too radical for the SEIU, it might be time to reevaluate!

    Shortly after, Applebaum and the AFL-CIO leadership made another push for neutrality at a meeting with NY Governor Cuomo and Amazon officials. Just hours after the meeting, Amazon announced it would be pulling out of the deal.

    To make matters worse, this isn’t the first time Applebaum and the RWDSU have helped kill a development project and cost the city thousands of jobs.

    About a decade ago, Applebaum opposed the Kingsbridge Armory development in the Bronx because the developers wouldn’t sign a living wage/union neutrality agreement. The armory development, which would have created 1,000 construction jobs and hundreds of permanent positions, was subsequently terminated. The site sat empty for years while the city languished under high unemployment in the midst of the Great Recession.

    With Amazon’s departure, New Yorkers can once again thank the hubris of union leaders for stripping the city of 25,000 job opportunities.

    Categories: AFL-CIOBuilding and Construction Trades CouncilSEIUTeamsters
  8. Labor Racket Weekly: December Round-Up

    Union bosses across the country ended 2018 on a low note. From embezzling union funds to committing fraud, below are some of the worst labor rackets from the end of last year:

    In Rhode Island, Adam Conheeny, former police officer and former Treasurer of Fraternal Order of Police (FOP) Lodge 8, was sentenced to three months of imprisonment followed by two years of supervised release. Conheeny previously paid $20,000 in restitution. He admitted to using an FOP debit card, writing checks from a union account payable to himself, and withdrawing cash from an FOP bank account for his own personal use, totaling approximately $31,413.

    In Michigan, Nancy Adams Johnson, former senior official in the Chrysler Department of the United Auto Workers (UAW), was sentenced to 12 months and 1 day in prison and 12 months of supervised release.  She was also ordered to pay a $10,000 fine and a $100 special assessment. Johnson plead guilty to one count of conspiracy to violate the Labor Management Relations Act, stemming from her receipt of over $45,000 in prohibited payments and things of value from Alphons Iacobelli, former Vice President of Fiat Chrysler Automobiles US LLC (FCA), and others acting in the interest of FCA.  The payments were made using the bank account and credit card account of the UAW-Chrysler National Training Center (NTC), which was established to provide for the education, training, and retraining of Chrysler workers.

    In New Jersey, Lawrence Ackerman, the Chief Operating Officer of “shell” companies including Atlantic Business Associates (ABA) and Atlantic Medical Associates (AMA), plead guilty to a superseding information for Health Care Fraud, as well as Aiding and Abetting. Ackerman executed a scheme to defraud Horizon Blue Cross Blue Shield (BCBS) of New Jersey involving enrollment of ineligible participants who were purported employees of ABA and AMA, both sham companies, in the benefit plan of United Auto Workers (UAW) Local 2326 which had an insurance contract with Horizon BCBS.  Ackerman entered into a collective bargaining agreement (CBA) with Local 2326; however, neither ABA nor AMA had any full-time employees eligible for participation in the benefit plan as required by the CBA and benefit plan trust agreement. The resulting loss to Horizon BCBS was approximately $481,500.

    Categories: Labor Racket Weekly