It Happened Before. It’s Happening Now. Will It Happen Again?

We have been over-inundated with news of corrupt union officials betraying their members’ trust and stealing their members’ dues monies. The case involving Fiat Chrysler Automobiles (FCA) and the UAW being the most recognized. It’s no secret that unions have a history of corruption, but it still seems like many people are surprised when they read about these abuses of power. Many people are asking themselves, “Where is the oversite on union finances?” or, “Are all union officials corrupt?”

Ricardo Torres – President & CEO

We have been over-inundated with news of corrupt union officials betraying their members’ trust and stealing their members’ dues monies. The case involving Fiat Chrysler Automobiles (FCA) and the UAW being the most recognized.It’s no secret that unions have a history of corruption, but it still seems like many people are surprised when they read about these abuses of power. Many people are asking themselves, “Where is the oversite on union finances?” or, “Are all union officials corrupt?”

There is oversite on local union finances, and the international unions tend to take their fiduciary responsibilities seriously when it reaches into the public realm. However, it is usually difficult to break through the “good old boys’ club” mentality and get anyone to start a serious investigation when concerns show up. First, nobody wants to trespass on anybody else’s turfon the local level, so there are many cliques in local union relationships. Second, inside the union halls, nobody wants to be viewedas a “rat”.

Most local Bargaining Agents (BAs) and Representatives (Reps) intermingle, so this is an additional barrier to overcome, as they have an unwritten rule about betrayal (of each other – members are another matter), even though most union constitutions have clear and specific language about corruption.

Different locals and unions also have different organizational chartsand cover a wide range of hierarchies. In some unions, the Secretary Treasurer holds the most power, while others grant it to the President. It all comes down to what is written in the individual local/union’s constitution or bylaws. For example, some locals have the President or Secretary Treasurer represent the members and negotiate contracts, whilein others, these duties are left to the BAs and/or Reps. Also, some unions have Districts or Regions, and the BAs and Reps are employees of aDistrict/Region, rather than individual locals. Other unions have a similar hierarchy where the BAs and Reps are staff charged with representing multiple locals. Finally, in some unions, BAs and Reps are employed directly by the locals.

Some positions are held only after getting elected by the union membership and represent specific units within their local and, if required by Department of Labor (DOL) guidelines,they also exercise executive functions of a labor organization and are considered Union Officers. It can get very confusion, depending on the union and their constitution/bylaws, to determine who is or is not an officer. In fact, it can get incredibly confusing.

According to the DOL, a typical Shop Steward does not have to be elected, although they usually are elected by their peers in the unit. Unless, he or she “would qualify as an officer (and thus become subject to the act’s election requirements) if he were so designated in the union’s constitution or if, as a steward, he were a member of the union’s executive board”.

So, you can see how confusing trying to determine who a union officeris, before even talking about whether they are all corrupt or not. I’m trying to point out that the definition of “Union Officer” can be very vague, but in the long run, it doesn’t really matter. Whether it’s just aunion employee or the union in general that is corrupt, action must be taken to protect the members who are paying their hard-earned dues money.

While unions have been viewed by many as corrupt since their inception, it seems that the corruption has been made more public over the last few years:

•Longshoremen Business Agent in Virginia sentenced for embezzling over $1 million.
•Pittsburgh Boilermakers Business Manager pleads guilty to embezzlement, tax evasion.
•New York City-area Labor Chieftain pleads guilty to shaking down contractor.
•UAW local president in New Jersey, insurance executive charged in $6.6 million union health plan scheme.
•And many, many more.

When I was a Union Official, I sat on several different review boardswhere we monitored and investigated alleged misdeeds. The problem that arises today is that some of the people who sit on some of these boards are from the District, Region, or Council that the accused parties come from and are compromised dues to local and policital ramifications. So, unless there is clear evidence of fraud, the matter is dropped, as long as there aren’t clear political and/or public relations complications.

One of the most memorable oustings I was involved in was when the former Teamsters President, Ron Carey, was accused of and
indicted for lying 63 times to federal officials regarding a fund-raising schemefor his 1996 reelection campaign. Under federal law, it is illegal to use money from a union treasury to support a candidate for union office,so the Independent Review Board overturned his election, disqualified him from running for Teamsters President again and he was expelled from the union for life. Although eventually cleared of any wrongdoing in the scandal by a jury ,Carey was never able to have the lifetime ban rescinded. It was notablethat Carey didn’t have much support from the Teamsters International staff, due to salary reductions that he put into effect after his first election victory. Ironically, this was coupled with a campaign promise to clear the union house of corrupt officers.

James P. Hoffa (or “Junior” as he was known in the inner Teamsters circle – which he hated, by the way) was quoted as saying, “We were the ones who eventually brought Ron Carey down. Thegovernment hated that, but they finally saw it.” Hoffa was also investigated for finance fundraising violations during his 1996 campaign. The Federal monitor overseeing the election didn’t find that he had any direct knowledge of a scheme to fix the election, but Hoffa could also have been barred for running from office.

I remember that election so well because I, along with other Teamsters, took unpaid leaves to volunteer with campaigning efforts for Ron Carey across the country. I also worked closely with Ken Paff, who heads the Teamsters for a Democratic Union (TDU), along with his staff and volunteers. I also remember reports of Hoffa supporters violating campaign rules, but the allegations were never substantiated.

I never believed that Carey knowingly violated any campaign rules. I participated in almost daily conference calls with the Washington, DC, campaign headquarters, and careful reminders of campaign ethics were a constant subject. I witnessed Ron Carey interact with the rank-and-file members and even spend the night in the homes of local union supporters.I knew all the Teamsters Vice Presidents and was personal friends with several who were of the highest personal and professional ethics.

I always believed that Hoffa would never have been elected in the 1998 election to replace Carey without his last name. Practically nobodyknew him personally, and he was disqualified from the 1991 election because he not been “employed at a craft within the union”. After his disqualification, he eventually got a “no-show” job as an assistant to Larry Brennan, who was then the head of the Teamsters’ Michigan Joint Council #43 and President of Local 337 in Detroit. Both Hoffa’s and Brennan’s fathers were indicted together for taking payoffs from commercial carrier companies to open a trucking company in their wives’ names.

In a perfect example of backstabbing, Hoffa removed Brennen from the International position he appointed Brennan to after his election. Hoffaeventually fired Brennan in 2007, although Brennan retained his positions with Local 337 and Michigan Joint Council #43.

As you can see, the politics of union corruption can get complicated,but the most common cases (and the most damaging, as they have the mostdirect impact on members) are on the small level. Local Reps sometimes receive kick-backs for negotiating sweetheart deals. I’ve witnessed Repsworking with management to get rid of trouble-maker members and union stewards. I even witnessed union staff members going to strip bars with company management on a regular basis to indulge themselves of these adult-only services on the company dime. I told the staff members that it had to stop, or I would report it. However, the practice didn’t stop,and I was met with blank stares when I tried to report it, and nothing ever came from it.

These union abuses that we are reading about now are, in my opinion, just the tip of the iceberg. I believe that they represent an internal flaw of the labor union structure. In the case of the UAW’s recent corruption problems, they claim to be cleaning house; but I saw first-hand what “cleaning house” meant when I was in the union, and I amnot personally convinced that the unions have changed their ways. Only time will tell.

I hope companies involved with unions don’t fall into a trap with them. Greed and power appear to be greater motivators than fear of prison time in a lot of cases. Year after year, we see reports about allthe union corruption cases, and the fear of incarceration does not seemto have any effect on dishonesty in the unions. The difference today isthe amount of exposure union corruption receives on social media. Members are hyperaware (compared to my day) of the unions’ mishandling of their dues.

If anyone should be paying attention to this, it’s the members and any group of employees who are contemplating joining a union. I sincerely hope these workers are doing their homework before signing a union authorization card or voting on an NLRB election day.