GOVERNMENT EMPLOYEES
New York Boss Charged with Embezzlement, Bribery & More
Patricia J. Ford, an ex-boss of the N.Y. State Public Employees Fed'n in Albany, was charged Feb. 22 in a five-count union corruption indictment. First, Ford allegedly embezzled some $10,000 from the union for her personal expenses in Mar. 1997 and, second, allegedly falsified the union's disbursement journal. Third, because NYPEF was in receipt of a federal grant of more than $10,000 from OSHA, Ford was also charged with embezzlement by an agent of an organization receiving federal funds.

Fourth, she was charged with receipt of bribe by an agent of organization receiving federal funds. Between Mar. and July 1997, Ford allegedly accepted a bribe from Peter Bynum, a N.Y.C.-based political consultant, to whom she awarded union business in exchange for his free help with her 1997 reelection campaign. Finally, she was charged with making false statements to a federal investigator--she allegedly lied about the bribe in May 1998.

Ford served as secretary-treasurer in 1994-97. If convicted, she faces up to 31 years in prison and $1.1 million in fines. The case has been assigned to U.S. Dist. Judge Lawrence E. Kahn (N.D.N.Y., Clinton). [USAO N.D.N.Y. 2/25/02; Times Union (Albany) 2/27/02]

STEELWORKERS (USWA)
Las Vegas Boss, Accused of $24,900 Theft, Pleads Guilty
David S. Manes, ex-business representative of United Steelworkers of Am. Local 12-711-A, which represents cab drivers in Las Vegas, pled guilty Feb. 20 to one count of embezzling $1,500 in union funds through an unauthorized salary payment on Oct. 8, 1998. The case is assigned to U.S. Dist. Judge Philip M. Pro (D. Nev., Reagan) and sentencing is scheduled for May 31.

Manes was indicted Aug. 29 on 153 counts of embezzling $24,923.42. Between Dec. 1996 and June 1999, he allegedly stole the funds in four ways: 1) 20 unauthorized salary payments; 2) 103 personal purchases on the local's Am. Express card; 3) 16 personal purchases on the local's Office Depot account; 4) 14 unauthorized union checks for his personal credit card and debts payments. According to the indictment, charges on the local's credit card included: Liquor Land $44.90, Frederick's of Hollywood $47.08, Wet Lace $89.80, Serge's Show Girl Wigs $177.62, and Roland's of Las Vegas (women's clothing store) $329.15. Manes also made multiple purchases at Dillards, Service Merchandise, Las Vegas Golf/Tennis, Mr. Bill's Pipe/Tobacco, and something called "Express Cash." He also allegedly made charges at Caesar's Palace, the Golden Nugget and the Desert Inn. He allegedly spent $364.20 at Airport Rent-a-Car and $479.50 at Eye Glass World.   Charges were also allegedly made at hotels, restaurants, foot-wear stores, records stores, drug stores, video stores, and gas stations. While he only pled guilty to one count, the plea agreement states that he "agrees to make restitution in an amount to be determined by the court." [USAO D. Nev. 3/1/02; DOL 2/20/02]

Virginia Bosses Indicted for Stealing From Disaster Fund
Five union bosses of United Steelworkers of Am. Local 9336 in Radford, Va., were indicted Feb. 19 with embezzling more than $10,000 that was paid the Local 9336 Disaster Relief Fund established after a fatal explosion at the Intermet New River Foundry in Mar. 2000. The fund was earmarked for workers affected by the explosion, in which three workers were killed. About $22,500 was raised. Some workers were facing foreclosure, repossession, and eviction as a result of the subsequent plant shutdown.

The five are charged with making payments to themselves totaling $11,856 from the Fund, while denying payments to workers in greater need. Allegedly, they didn't publicize the fund and made payments to themselves after they had gone back to work or on paid sick leave. William E. Fricker, ex-local president, is charged with stealing $3,154; Edward A. Ramsey, ex-president and vice president, $1,101; Joseph W. Burress, ex-financial secretary, $1,276; Rhonda L. Creed, ex-grievance committee chairwoman, $1,239; and Elizabeth J. George, an unidentified officer, $4,186. George, who never returned to the foundry, is also charged with approving $900 in unauthorized payments to Robert E. "Robbie" Martin, with whom she had a "relationship." Martin wasn't charged.

All but George were also charged in a second scheme which secured about $10,809 from false or excessive claims for "lost time"--they allegedly double-billed the local for lost time for which they were also paid by the foundry. Further, some submitted claims at excessive pay rates. Fricker is charged with stealing $3,217; Ramsey, $3,964; Burress, $1,745, and Creed, $1,883. The 19-count indictment included charges of conspiracy to embezzle, conspiracy to make false entries in union records, embezzlement, and false entries. If convicted, the four face up to 17 years in prison and a $950,000 fine. George faces 11 years in prison and a $600,000 fine. The union reported the schemes to the Dep't of Labor. The five surrendered to federal authorities on Feb. 21 in Roanoke.

"We are saddened that there may have been people who tried to profit from the tragedy of others," said Mike Kelly, communications manager at Intermet's headquarters in Troy, Mich. "These things happen. . . . It's strictly a matter between the Department of Labor and certain former officials of the union."  [Roanoke (Va.) Times 2/21-22/02; USAO W.D. Va. 2/19/02]

Ohio Boss Sentenced for $21,600 Theft
U.S. Dist. Judge Paul D. Matia (N.D. Ohio, H.W. Bush) sentenced Stephen T. Hanlon Feb. 13 to five years probation, including six months home confinement with electronic monitoring, for embezzling $21,657.58 from United Steelworkers of Am. Local 01-4564-S in Girard, Ohio. He also ordered Hanlon to make full restitution.

Hanlon pled guilty Nov. 16 to union embezzlement after being charged on Nov. 2. He admitted to embezzling the funds from May 1998 to June 2000, while serving as financial secretary. He embezzled the funds by various checks-for-cash schemes and using the cash for personal purposes. To circumvent the three-signature requirement for union checks, he wrote and cashed 47 counter checks, payable to himself or cash. He also stole funds by getting cash back from bank deposits of union checks, including payroll tax deposits. He also diverted and cashed the local's tax refunds from the IRS, the receipt of which he did not disclose to other bosses.

Because the local's practice was to use the home address of the financial secretary as the local's business address, Hanlon received the refunds at home. To conceal the thefts, he provided the local's treasurer false figures and did not provide actual bank statements. [USAO N.D. Ohio 2/14/02, DOL 2/13/02]

Knoxville Boss Gets 10 Months for $10,500 Embezzlement
On Feb. 11, ex-secretary-treasurer of United Steelworkers of Am. Local 35-8681 Donald G. Martin was sentence to five months at a half-way house and five months home detention. Martin was indicted on Mar. 21, 2001, on charges of embezzling $10,591 from the Knoxville-based local, making false entries in union records, and false reporting. Martin was found guilty on all counts by a jury on Oct. 10. In addition to the confinement, he was sentenced to three years of supervised release. He was also ordered to make restitution of $10,400 and pay $5,075 in special assessments. [DOL 2/11/02]

Probation for $3,800 Ohio Theft
U.S. Dist. Judge Paul D. Matia (N.D. Ohio, H.W. Bush) sentenced William A. Fast, ex-treasurer of United Steelworkers of Am. Local 1013-L (now part of Local 1-3059) in Sebring, Ohio, Feb. 12 to two years probation and fined him $1,000 for embezzling $3,893.71 from the local. Fast pled guilty on Oct. 22 to one count of union embezzlement  and has paid $6,914 in restitution. According to his confession to Dep't of Labor agents, Fast embezzled the funds by using 19 union checks for personal use between 1995-98. He admitted writing false information in the memo section of the checks in order to conceal their true purpose. This false information reportedly included bogus vending machine repairs, stamp purchases, dues refunds, and lost salary. Also, he allegedly claimed expenses for a fictitious Christmas party, Christmas bonus, summer party, and contract negotiation. [USAO N.D. Ohio 2/26/02; DOL 2/12/01]

SHEET METAL WORKERS (SMW)
Michigan Staffer Accused of $32,800 Theft
Lorri Delaney was charged Feb. 6 with embezzling $32,890 from Sheet Metal Workers Int'l Ass'n Local 80 in Southfield, Mich. She was the local's bookkeeper. [DOL 2/6/02]

FLINT GLASS WORKERS (AFGWU)
Kentucky Boss Admits $14,400 Theft
Raymond F. Pendygraft, ex-financial secretary of Am. Flint Glass Workers  Union Local 1009 in Danville, Ky., pled guilty Feb. 20 to one count of embezzling $14,419.23 in union funds from 1996 to Dec. 1999. U.S. Dist. Judge Jennifer B. Coffman (E&W.D. Ky., Clinton) in Lexington set sentencing for June 6. Pendygraft faces a maximum of five years in prison followed by three years supervised release plus a $250,000 fine. Based on his conviction, he will also be prohibited from serving as an officer in any labor organization for 13 years. [DOL 2/20/02; USAO E.D. Ky. 2/20/02]

FOOD & COMMERCIAL WORKERS (UFCW)
North Carolina Boss Sentenced for $13,200 Theft
On Jan. 30, Roger Causby was sentenced to four months imprisonment and four months home detention, followed by two years of supervised probation, for embezzling union funds. Causby, ex-secretary-treasurer of the United Food & Commercial Workers Int'l Union Local 427 in Morganton, N.C., had previously pled guilty to union embezzlement and had made restitution of $13,218 He was charged Jan. 9, 2001. [DOL 1/30/02]

Fresno Boss Gets Year for $6,000 Theft
In Kings County (Cal.) Superior Court on Feb. 14, Robert S. Ramos, ex-president of United Food & Commercial Workers Local 193-I in Fresno, entered a plea of no contest to misdemeanor theft. He was sentenced to one year in the county jail, three years probation, and fined $2,700. He was also ordered to pay $6,000 in restitution, $1,000 of which was already paid, over three years. He was charged on Nov. 1, 2001. [DOL 2/14/02]

PLUMBERS & PIPE FITTERS (UA)
Arkansas Staffer Indicted for $11,600 Theft
L. Ann Brockman, ex-office secretary for United Ass'n of Plumbers Local 665 in Pine Bluff, Ark., was indicted Feb. 5 on 26 counts of embezzling $11,621 in union funds. [DOL 2/5/02]

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ADDITIONAL BRIEFS NOT INCLUDED ON THE FAX EDITION OF THIS UNION CORRUPTION UPDATE:

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NURSES (PNA)
Ohio Boss Gets 3 Months at home for $19,100 Theft
U.S. Dist. Judge David A. Katz (N.D. Ohio, Clinton) sentenced the ex-treasurer of the Lima (Ohio) Mem'l Prof'l Nurses Ass'n, Sharon K. Schmenk, Feb. 1 to three years probation, the first six months to be spent in home confinement. She must wear an ankle monitor, which costs  $4.95 a day. She must pay for the monitor (approximately $891). Katz also ordered the boss to to make full restitution. She pled guilty Oct. 5 to embezzling $19,170 in union funds.  [DOL 2/1/02; USAO N.D. Ohio 2/25/02]

NURSES / TECHNICAL EMPLOYEES
Minnesota Boss Gets Probation for False Entries, Paid $18,700 in Restitution
On Feb. 25, in the U.S. Dist. Court for the Dist. of Minn., Judy Domning, ex-executive director of the Minn. Licensed Practical Nurses Ass'n and ex-executive director of the Technical Employees Ass'n of Minn., was convicted of making a false statement by making false entries in union records. She was sentenced to two years probation and barred from employment by unions "for life." She had pled guilty on Aug. 24 and had previously made restitution of $18,772.

The sentence was a downward departure for her substantial assistance in the prosecution of union consultant, Elliot M. Cohn of Coral Springs, Fla. who had pled guilty to mail fraud on Feb. 8, 2001 before U.S. Dist. Judge Michael J. Davis (D. Minn., Clinton). Cohn, president of a labor negotiating firm, admitted to bilking the two unions out of almost $25,000 in fraudulent expenses. For example, Cohn said that from 1996-98, he billed $22,000 in phony airfare expenses to the MLPNA and also manipulated the compensation he drew from the TEAM. He paid $106,476 in restitution to the two unions during the 2001 hearing. [DOL 2/25/02; Star Trib. (Minneapolis) 3/9/01]

TRANSPORTATION UNION (UTU)
Syracuse Boss Pleads Guilty to Falsification Charge
Michael G. Brown, secretary-treasurer of United Transp. Union Local 1007 in Syracuse, N.Y., pled guilty Feb. 13 before U.S. Magis. Judge Gary J. Sharpe (N.D.N.Y.) to making false entries in union records to conceal theft. A one-count information was brought on Feb. 7 and alleged that the crimes occurred from Jan. 1999 to June 2001. According to the plea agreement, Brown wrote unauthorized union checks to himself for alleged reimbursed Local Committee of Adjustment (LCA) expenses which he did not record in the local's LCA ledger. He confessed that the funds belonged to the local and that he used them for his own personal expenses. The amount of funds taken was not disclosed, but Brown must make full restitution under the terms of the plea agreement. There was no reason given for why a union embezzlement charge was not brought. Sentencing is tentatively scheduled for Mar. 20. [USAO N.D.N.Y. 2/22/02; DOL 2/13/02]

GUARD UNIONS
Two Bosses Admit False Entries; Ordered to Make $4,800 in Restitution
On Jan. 24, U.S. Magis. Judge Harwell G. Davis, III (N.D. Ala.), sentenced Roy Summerlin, ex-treasurer of Guards Independent Reg'l Council 10, to three years supervised probation and ordered him to make restitution of $1,212. Davis also sentenced Tom T. Hall, ex-vice-president of Reg'l Council 10, to three years supervised probation and ordered him to make restitution of $3,636.95. The two amounts reportedly equate to full restitution. Both bosses were charged on Nov. 29 with making false entries in required union records, and both pled guilty on Jan. 22. According to the U.S. Atty's Office for the N. Dist. of Ala., the false records charge, a misdemeanor, was brought instead of a union embezzlement charge because it was more expedient. Reg'l Council 10 is based in Nashville. [DOL 1/24/02; USAO N.D. Ala. 2/25/02]

ELECTRONIC WORKERS (IUE)
Mississippi Boss Accused of Failing to Maintain Union Records
On Jan. 28, 2002, in U.S. Dist. Court for the N. Dist. of Miss., Richard S. Smith, ex-president of Int'l Union of Electronic Workers Local 770 in Columbus, Miss., was charged in a one-count information with failure to maintain union records. [DOL 1/28/02]

TEAMSTERS (IBT)
Indicted Boston Teamster Released
A Boston-area Teamster with ties to reputed mobster James J. "Whitey" Bulger was freed on house arrest Feb. 21 after his daughter pledged her home as $100,000 surety.  John J. "Mick" Murray was released on an electronic monitoring bracelet to his daughter's custody and ordered not to leave the house except for court appearances.  Murray, a Int'l Bhd. of Teamsters Local 25 member, was charged in with shaking down a bookie as well as planning an extortion of indicted Local 25 boss George W. Cashman for favored treatment on the local's movie crew. Both Murray and Cashman were indicted on charges of trying to defraud the union's health and pension funds. [Boston Herald 2/22/02]

LABORERS (LIUNA)
Oregon Fund Manager May be Close to Plea Deal
Jeffrey L. Grayson, the indicted former union fund manager, has tentatively agreed to cooperate with federal prosecutors in Oregon in the fraud and money-laundering case stemming from his investment firm's collapse. His cooperation could mean that a plea agreement is imminent, which would allow Grayson to avoid a trial on 22 counts of fraud, conspiracy, money-laundering, witness-tampering and making illegal payoffs to a union trust fund trustee. Harvey Silets, a Chicago criminal defense lawyer representing Grayson, said that "we've been in discussion with the government. No plea agreement has been signed."  Asst. U.S. Atty. Lance Caldwell said essentially the same thing. "The only thing I can confirm is that there have been discussions."

The Securities & Exchange Comm'n and the Dep't of Labor seized the firm, Capital Consultants in Sept. 2000, accusing Grayson of running a Ponzi-like scheme to conceal investment losses. A court-appointed receiver estimated the losses, mostly to union pension and benefits funds, at $355 million. Unless Grayson and the government finalize their plea deal, he is due to go on trial Mar. 26. If convicted on all counts, Grayson could face eighty years in prison.

The fate of Grayson's prison-bound son, Barclay L. Grayson, ex-president of Capital Consultants, played a role in the senior Grayson's decision to seek a deal. Sources close to the case said Barclay helped persuade his father to negotiate with prosecutors. "If an agreement is reached between Jeff Grayson and the government, this could benefit Barclay Grayson," said Steven Ungar, Barclay Grayson's Portland attorney. Prosecutors could file a motion requesting the judge reconsider Barclay Grayson's sentence.

Barclay Grayson is due to report in May to the Fed. Correctional Institution at Sheridan where he will begin serving a two-year term after pleading guilty to mail fraud. The unexpectedly stiff penalty, imposed in Oct., drew cries of dismay from Barclay Grayson and his family, who had hoped for a suspended sentence.

John Abbott, former co-chairman of three Laborers' Int'l Union of N. America pension and benefit funds, also is headed for prison in May. He was sentenced to 15 months in Nov. 2001 after admitting in federal court he accepted nearly $200,000 in secret payoffs from Jeffrey Grayson while steering the trust funds' money to Capital Consultants.

Jeffrey Grayson's cooperation could prove valuable to the ongoing criminal investigation of the case. "There is a substantial amount of information concerning other people that has yet to be told to anyone," Jeffrey Grayson said an e-mail to friends uncovered by the Oregonian. "I already know that [there is interest] in information concerning existing defendants as well as those that have not been named."  Andrew Wiederhorn and Lawrence Mendelsohn were both notified last spring that they were targets of a federal grand jury investigation. The duo headed the former Wilshire Credit Corp., which borrowed and failed to repay $160 million from Capital Consultants. The default threw Capital Consultants into financial disarray. After the firm's collapse, several unions and others filed civil lawsuits against Wiederhorn, Mendelsohn and their company, accusing them of having an "undisclosed corrupt relationship" with Grayson and Capital Consultants. Caldwell declined to comment on where the investigation may now lead. [Oregonian 2/22/02]

GOVERNMENT EMPLOYEES / UNION DUES
Pro-Worker Reforms force Colorado Union Eliminate Entire Field Staff
Colo. Gov. Bill Owens (R) terminated state payroll deduction of union dues through an executive order issued in May 2001. Now Owens reports that the Colo. Fed'n of Public Employees has seen its dues collection drop of 50% since the order was issued, prompting the union to lay off its entire field staff of 17 people. Reportedly, such positions are routinely used for political operations.  Americans for Tax Reform believes this is further evidence that when unions are forced to collect funds in the same way everyone else has to, many union members choose to not participate.

In a recent UPI interview, Owens stated: "We ordered a review of all the withholdings the state took with their permission from employee paychecks. We withheld funds from paychecks for literally hundreds of reasons. After a thorough review and following state statute, we now restrict those withholdings to just a handful that are clearly in the state's interest. Among the enterprises we no longer withhold are labor unions. For legal reasons, I'd point out, a labor union member can now go to a bank and get that withholding done where 20 or 30 years ago that was impossible. The result is that we have seen about a 50 percent drop in our state public employee union. They have laid off all 17 of their field personnel. This is going to force that union to be closer to its membership. Clearly, a large number of its members were not willing to pay the annual dues when those dues had to be publicly and directly collected." [ATR 2/19/02]

AIR LINE PILOTS
Houston Judge Slaps Down Member's Fiduciary Duty Suit
U.S. Dist. Judge Lynn N. Hughes (S.D. Tex., Reagan) ruled Feb. 4 that Louis A. Hoffman, a member of the S.W. Airlines Pilots Ass'n aggrieved by the conduct of the union's bosses, including the ex-president's use of union money to ship a pair of moose antlers to his out-of-state home, does not good cause to bring suit under the Labor-Mgmt. Reporting & Disclosure Act of 1959 (a.k.a. Landrum-Griffin Act). "Because corrupt union leadership cannot be trusted to police itself, individual union members may sue officers if the union refuses to take action," but the have to show good cause, Hughes wrote. Hoffman has appealed the ruling to the U.S. Court of Appeals for the Fifth Circuit.

"However stupid and wasteful the former officers' actions may have been," they did not amount to breach of fiduciary duty under the LMRDA, Hughes said. Finding that Hoffman had no cause to sue, the court suggested that he "pursue his frustration ... through other avenues; he should watch the current administration to ensure it does not repeat the errors."

Hoffman brought fifteen charges in all. In addition to the shipment of the moose antlers, Hoffman charged that the bosses, John E. Kramer, Marilyn H. Zeiler, and Patrick P. Filburn, conspired to rig a union election and complained about the bosses' decisionmaking and administrative practices. He filed internal union charges maintaining that the officers, who no longer hold the elected posts, engaged in conduct that breached their fiduciary duty to the union. When the pilots' union refused to take action, Hoffman petitioned the court, maintaining that he had good cause to sue.

Further, Hughes pointed out that the union officer election Hoffman complained of had been rerun by the Dep't of Labor and that the initial winner of the vice president post lost in the second election. "The remedy for the defective electoral process is not this suit but the intervention of the Labor Department," Hughes said.

Hughes described other claims of Hoffman as arising from disagreements over the officers' routine operating decisions and internal office administration. "Deciding to pay for an employee's graduate studies, giving employees extra time off, or even shredding union documents are not breaches of fiduciary duty covered by the statute," the court said. "Neither are poor attendance, sloth, and sending letters to union members instead of using the union newsletter violations of federal law."

With respect to the moose antlers, Hughes acknowledged that the former president spent union money to send the trophy from his office to his home in New Mexico. However, "he had used the antlers as an office decoration, giving the union the benefit of their use in consideration of the re-delivery cost," the court said. "Federal law does not bar a union from shipping personal effects from an office to a home once an officer has been turned out of his position," according Hughes.  Thus, Hughes concluded that Hoffman did not have good cause to sue.

The union is headquarter in Dallas, but the suit was brought in Houston. Joseph A. Garnett of Houston represented Hoffman, Patrick Flynn of Houston represented the former officers, and Nicholas Enoch and Stanley Lubin of Phoenix represented the union. [BNA 2/21/02; Hoffman v. Kramer,  No. 01-486,  2002 U.S. Dist. LEXIS 2475, at *1 (S.D. Tex. Feb. 4, 2002)]

CARPENTERS (UBC) / UNION DEMOCRACY
Appellate Victory for New England Member's Election Suit
The U.S. Court of Appeals for the First Circuit ruled Feb. 19 that the Dep't of Labor's explanation for rebuffing a union member's challenge to the United Bhd. of Carpenters' election procedures raised "serious question" regarding DOL's adherence to its "own articulated policies" and demanded that the decision be presented in a "more reasoned fashion" The court's decision stemmed from a challenge to the election of officers of the Carpenters' New England Reg'l Council. Thomas Harrington, a UBC member, maintained that, since CNWRC performed functions and purposes traditionally accorded to local unions, its officers should be elected in accordance with the procedures governing local elections. Harrington argued that the officers should be selected by members in a direct election by secret ballot, rather than by a vote of delegates who are elected by members of local unions.

Harrington filed suit under the Labor-Mgmt. Reporting & Disclosure Act of 1959 (a.k.a. the Landrum Griffin Act) challenging DOL's refusal to order CNWRC to hold a new election as a local union. While the district court dismissed the suit, the First Circuit found what it called an apparent "inconsistency between [DOL's] approach" to this case and its "regulation and prior decisions." The "paucity of explanation hinders judicial review, requiring a remand to DOL to reopen, thereby providing [DOL] an opportunity to better explain [its] position," the court said in a decision by U.S. Circuit Judge Sandra L. Lynch (1st. Cir., Clinton), joined by U.S. Circuit Judge Kermit V. Lipez (1st Cir., Clinton).

DOL said that while CNWRC's bylaws "appear to invest it with some of the powers and functions the locals traditionally possessed," it could not conclude that the council "is no longer an intermediate body entitled to elect its officers in accordance with either of the two choices prescribed by Congress" in LMRDA Section 401(d). That section requires that officers of intermediate bodies "be elected not less often than once every four years by secret ballot among the members in good standing or by labor organization officers representative of such members who have been elected by secret ballot."

Taking issue with DOL's reasoning, the court questioned why the statement of reasoning failed to cite prior DOL regulatory interpretations of the LMRDA and why it failed to distinguish Harrington's case from previous decisions in which it sued to force an entity purporting to be an intermediate body to conduct elections. The majority stopped short of calling DOL's decision arbitrary and capricious, but U.S. Circuit Judge Juan R. Torruella (1st Cir., Reagan) did not. In a concurring opinion, he argued that the position should be classified as such and put aside since DOL's "decision in this case does not square with [its] established policies and practices."  DOL provided no reasoned basis for the inconsistency, he said. However, he continued: "Since my view does not command a majority of this panel, I must await, with morbid curiosity, a persuasive clarification of the reasons for [DOL's] decision."

Renee J. Bushey of Feinberg, Campbell & Zack in Boston represented Harrington. J. Matthew McCracken argued the case for DOL.

HOTEL & RESTAURANT EMPLOYEES (HERE) / UNION DEMOCRACY
LMRDA Preempts State Whistleblower Statute, says New Jersey Court
The N.J. Superior Court, Appellate Division, held Feb. 15 that a claim by union employee Regina Dzwonar that she was discharged for exposing what she considered to be union violations of the Labor-Management Reporting & Disclosure Act of 1959 cannot be brought under state law. Dzwonar's claim under N.J.'s Conscientious Employee Protection Act against the Hotel Employees & Restaurant Employees Int'l Union Local 54 in Atlantic City was preempted by the LMRDA, according to Judge Donald S. Coburn.

LMRDA, the court said, requires that "elected union officials be responsive to the will of their union membership-electorate." This in turn requires that elected officials have the authority and ability to discharge employees of the union in policymaking positions, such as Dzwonar, who they believe ill-serve the membership, the court explained. To allow state actions contesting such discharges, the court said, would undermine the strong federal policy favoring union democracy embodied in the LMRDA.  CEPA prohibits, among other things, retaliatory action against an employee who objects to an activity or practice the employee "reasonably believes ... is in violation of law."

In 1996, Dzwonar was employed by Local 54 as a full-time arbitration officer. After many intense disagreements about union business with the local president, Dzwonar was discharged. She sued the local under CEPA, claiming that she had been discharged because she had brought to light what she alleged were violations of LMRDA by the local. Specifically, the court said, she maintained that she had repeatedly advised the local president that the local union's by-laws and the LMRDA were being violated by the executive board's failure to share information with the general membership concerning matters such as the hiring of staff and their salaries. She thought this might be remedied by reading executive board minutes at general membership meetings, and sent the suggestion in a memo to executive board members.  The provisions of the LMRDA that Dzwonar claimed she reasonably believed were violated, the court noted, were those assuring members equal rights to participate in deliberations, express their views, and vote on union business.

Judges James M. Havey and Dennis J. Braithwaite concurred in the opinion. William T. Josem of Cleary & Josem, represented Local 54. Nelson C. Johnson represented Dzwonar. [BNA 2/26/02]

LETTER CARRIERS (NALC)
Michigan Local Mistreatment of Nonunion Worker Precluded Grievance Representation
The U.S. Court of Appeals for the Dist. of Columbia Circuit ruled Feb. 26 that because union stewards wrongfully prevented a nonunion postal employee from filing a grievance, Nat'l Ass'n of Letter Carriers Branch 3126 in Royal Oak, Mich., must allow the employee to proceed with the grievance and pay for him to be represented by his own attorney.

Enforcing an order issued by the Nat'l Labor Relations Bd., U.S. Circuit Judge Douglas H. Ginsburg (D.C. Cir., Reagan) ruled that NLRB was authorized to issue the order for attorneys' fees. The court rejected the union's argument that it could have represented employee Joe Pitlanish fairly and without bias: given the union stewards' prior mistreatment of Pitlanish, it was within the board's discretion to decide that an independent lawyer was the better strategy, the court said.

Pitlanish is a letter carrier for the post office in Troy, Mich. In 1997, he tried to file a grievance about the distribution of overtime opportunities, but the union stewards impeded his efforts. In particular, union steward Greg Swindall, who monitored the employer's distribution of overtime and represented unit employees in overtime disputes, refused to file and process his grievance because he was not a member of the union. The court added that Swindall also referred to Pitlanish as "Scablanish."

U.S. Circuit Judges A. Raymond Randolph (D.C. Cir., H.W. Bush) and David S. Tatel (D.C. Cir., Clinton) joined in the ruling.  Thomas N. Ciantra represented the union. James M. Oleske argued on behalf of the board. [BNA 3/4/02]

AUTO WORKERS (UAW) / UNION DUES
Beck Victory for Connecticut Worker
On remand from the U.S. Court of Appeals for the Dist. of Columbia Circuit, the Nat'l Labor Relations Bd. provisionally held Dec. 20 that autoworker George Gally is entitled to a make whole order to remedy the violation found by the court. That is the United Auto Workers of Am.  and UAW Local 376 in Hartford, Conn. violated the Nat'l Labor Relations Act causing Gally's employer Colt Industries to discharge Gally for nonpayment of dues without first informing him of the amount by which his union fees would be reduced if he became an objector under CWA v. Beck. NLRB originally dismissed Gally's complaint but was reversed by the court.

NLRB accepted the court's findings and found that UAW and Local 376 engaged in unfair labor practices, it required them to notify the employer in writing, with a copy to Gally, that they have no objection to his employment and that they affirmatively request his reinstatement. NLRB also required the union and the local to notify Gally of his rights under Beck and to inform him that he is not subject to discharge for nonpayment of union dues in the absence of such notification. The notice must include the amount by which Gally's fees would be reduced were he to become a Beck objector. UAW and Local 376 were ordered to make Gally whole for any loss of wages and benefits he may have suffered as a result of their unlawful conduct, from the date of his discharge until the date of his reinstatement by the employer.

However, NLRB gave UAW and Local 376 the opportunity to litigate, at the compliance stage of this proceeding, that Gally was a "free rider," who willfully and deliberately sought to evade his union-security obligations. If the union and the local make this showing, Gally will not be entitled to backpay. In the overturned decision, NLRB did not address the free rider issue because it held that the union and the local's conduct causing Gally's discharge were not unlawful. [BNA 1/22/02]

TEAMSTERS (IBT) / UNION DUES
Oklahoma Seeking to Stop Union Payroll Deductions for Non-Members
Enforcing for the first time an administrative rule that has been on the books for five years, the Okla. Comm'r of Labor Brenda R. Wynn ordered a Tulsa employer to stop deducting the union dues of employees who resigned from their union. In a Feb. 12 letter to Baldwin Steel Co., Wynn demanded that the firm refrain from withholding union dues from the paychecks of 19 employees who resigned their membership from Int'l Bhd. of Teamsters Local 523 and asked that their dues no longer be deducted.

Wynn said the regulations implementing its wage law lists allowable deductions from employee paychecks, but that union dues are not an allowable deduction. The regulations are intended to protect employees who do not want money deducted from their paychecks without their permission

Reportedly, the regulation had never been enforced in terms of union dues or agency fees because no one had ever complained before. Here, a Baldwin official reportedly contacted the Okla. Dep't of Labor and reported that Baldwin was deducting dues from the paychecks of employees who had resigned from the union and had asked Baldwin to stop deducting the dues. The employer was reportedly seeking guidance on whether it had to continue making the deductions as demanded by the union.

"This is a worker's rights issue," Wynn said. "At least 19 workers have told both the union and their employer they want to keep the fruits of their labor. As labor commissioner, I will do everything within my authority to promote the welfare of Oklahoma workers."

In her letter, Wynn said that if Baldwin did not comply with the regulation she would initiate hearings and subpoena witnesses to "fully investigate this matter and, at the conclusion thereof, I will issue an appropriate (and binding) order as the facts may warrant." She pointed out that if Baldwin is found to have violated the regulation, it will be liable to the employees "for the amount of any illegal deductions, plus liquidated damages, costs, attorney's fees, and any other remedies or penalties as provided" in the law.

According to Local 523 president Randy Campbell, Baldwin is obligated to continue deducting dues from employees who sign dues checkoff cards unless the employee complies with the requirement that he/she revoke the checkoff in writing during a specified time. He explained that the dues checkoff provision in the contract specifies that an employee's checkoff authorization renews automatically unless the employee sends written notice to the union asking to revoke checkoff at least 60 days but not more than 75 days before the anniversary date of the signing of the authorization card. For example, he said, if an employee signed a card for dues checkoff on Feb. 1, 2001, he/she would have to revoke the authorization in the last two weeks of Nov.

Baldwin is still considering its options, according to president Bob Welter. Welter said that after several employees asked Baldwin to stop withholding union dues from their paychecks, Baldwin asked the union to "agree that those employees who have resigned from the union should no longer have union dues withheld from their paychecks. The union vehemently disagreed and threatened to sue Baldwin if it stopped withholding dues from the employees' paychecks or refused to pay those dues to the union until such time as the union formally advised Baldwin to stop. The union indicated that the time frame in which an employee could cease paying dues was controlled by internal union rules and that Baldwin would be guilty of unfair labor practices if it ceased withholding and remitting union dues for these employees," he said.

Campbell disputed the claim that the union threatened to sue Baldwin if it failed to withhold dues. He said that when the parties were negotiating a new contract in Oct. 2001 Baldwin proposed deleting the union security clause and the dues checkoff because of a new right-to-work law in the state that took effect in Sept. 2001. Campbell said he told management that he would not delete the dues checkoff clause because Baldwin was obligated to deduct dues for those employees who have signed authorization cards. When asked what would happen if Baldwin took out the language, Campbell said he replied that Baldwin may have a problem and might have to pay the dues for the workers.

W. Kirk Turner of Newton, O'Connor, Turner & Ketchum, attorneys for Baldwin, told BNA Feb. 14 that Baldwin is "looking at all the issues."  According to Turner, the State is not saying that the union cannot collect dues but rather that the employer cannot withhold dues under the regulation. "My client is in the middle," he said. "It's the employees' money that is being withheld. The employees and the state are telling them not to withhold the money, while the union is telling them to withhold the dues," he added.

Reportedly the newly enacted right-to-work law was the "catalyst" for the 19 employees asking the company to stop deducting their dues.

The regulations prohibit all payroll deductions except those mandated by statute, court order, or the rule itself. Under the regulation an employer and an employee can agree to only five categories of payroll deductions. "A union dues check-off agreement does not fall within the parameters of the five categories of deductions lawfully permitted by" the statute.  Wynn wrote in her letter to the company.  [BNA 2/19/02]

GOVERNMENT EMPLOYEES:PROFESSIONAL ENGINEERS (PECG) / UNION DUES
California State Employees Win Class Action Status
By certifying  a federal suit as a class action, U.S. Dist. Judge Garland E. Burrell, Jr. (E.D. Cal., H.W. Bush) has allowed 3,200 Cal. state employees to  challenge the money confiscated for politics and other  activities by the the State and the Prof'l Engineers in Cal. Gov't.  Nat'l Right to Work Legal Def. Fdn. attorneys filed the  lass-action suit, Wagner v. PECG, in Sept. 1999 on behalf of Richard Wagner, an investigator for the Cal. Air Resources Bd. in the Sacramento area,  and Kristin Schwall, a water quality engineer from San Diego. They filed the complaint on behalf of all non-member government workers under the PECG's statewide memorandum of understanding (MOU) - also known as a collective bargaining agreement - who have been illegally forced to pay for union political  activities.

On Apr. 1, 1999, then newly elected Cal. Gov. Gray Davis (D) signed the MOU which forced all workers under the agreement to pay illegally high dues to PECG. "Governor Davis has done everything possible to payoff  California's union officials, at the expense of the  working men and women of this state," said Stefan Gleason, Vice President of the National Right to Work  Foundation, which is providing free legal aid to the employees.

PECG is one of Cal.'s most politically active unions. Union bosses have seized union dues and used them to fund its ballot initiatives and other political activities. According to the union's own records, it has been estimated that over one-third of PECG's $3.2 million annual budget is used for political activities.

According to the constitutional protections construed by the U.S. Supreme Court in NRTWLDF-won decisions of Abood v. Detroit Bd. of Educ. and Lehnert v. Ferris Faculty Ass'n, the union may not collect compulsory dues spent on activities unrelated to collective bargaining. Politics, lobbying, organizing, public relations, and other non-bargaining activities are explicitly non-chargeable to employees who have exercised their right to refrain from union membership.  The employees are asking the court to provide the abused workers with retroactive refunds, with  interest, on all dues illegally collected since Apr.  1, 1999. [NRTWLDF 2/25/02]

Milton L. Chappell of the Nat'l Right to Work Legal Def. Fdn. in Springfield, Va., represented Wagner and Schwall. Steven B. Bassoff of Sacramento represented the union. [BNA 3/14/02]

AFL-CIO / ELECTIONS & POLITICS
FEC Appeals Hidden Records Case
The Fed. Election Comm'n filed an appeal Feb. 15 in a case testing the limits of disclosure of documents from FEC investigations of possible campaign finance violations.  The notice of appeal was filed with the U.S. Court of Appeals for the Dist. of Columbia Circuit. It challenged a decision by U.S. Dist. Judge  Gladys Kessler (D.D.C., Clinton), that documents from the FEC probe of links between the Democratic Nat'l Committee and the AFL-CIO must be kept secret. The FEC investigation was launched following reports of a $35 million AFL-CIO effort to aid Democrats in the 1996 congressional election

The four FEC commissioners participating in the case -- two FEC members are recused -- voted unanimously for the appeal in a closed meeting Feb. 12. The move means that the FEC will defend its historic policy of placing virtually all documents from campaign finance investigations on the public record, once the case is closed. FEC Chairman David Mason said that some documents involving other FEC enforcement cases would continue to be made public pending the appeals court decision. Just which documents to make public in each case will be decided "on more or less an ad hoc basis," Mason said.

Kessler held that federal law only requires limited disclosure of documents resulting from an investigation by the commission. Only summary documents, such as a settlement agreement or FEC general counsel's report about a case, should be disclosed.  In Dec. 19 decision, Kessler acknowledged that the decision would end "a 25-year practice by the FEC to make available to the public the full investigatory record pertaining to any complaint filed once the complaint is resolved." [BNA 2/19/02]
 

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