News pertaining to the Teamsters and unions in general.

Hired Truck probe blocked by Hoffa

BY TIM NOVAK, STEVE WARMBIR AND ROBERT HERGUTH Staff Reporters

Teamsters President James P. Hoffa's administration blocked his investigators from putting Mayor Daley's scandal-plagued Hired Truck Program and other possible union-related corruption under a microscope, the Chicago Sun-Times has learned.

The non-union drivers who are the backbone of the Hired Truck Program were one area of concern of Hoffa's internal corruption unit.

But Hoffa's administration argues there was no need for a union investigation because the FBI already is conducting one and law enforcement is best equipped to handle a probe.

The unit made national news last month when its chief, former prosecutor Ed Stier, and key investigators resigned over what they saw as Hoffa's resistance to examine several union corruption matters in Chicago.

"This is a dispute between Ed Stier and me over who is going to do the investigations and how they will be conducted," said Patrick J. Szymanski, the general counsel for the Teamsters in Washington, D.C. "This is not about the International Brotherhood of Teamsters all of a sudden changing its mind and throwing open our doors to organized crime."

Attorney Howard Anderson, Stier's partner, declined to say what investigations Hoffa allegedly blocked. A Teamster official confirmed that the Hired Truck Program was among those areas investigators wanted to further explore.

The Sun-Times exposed waste and corruption in the Hired Truck Program, in which the city hires private dump truck companies with non-union drivers to haul debris and material. Some companies had ties to organized crime figures; others were heavy with political clout.

Anderson did say that investigators became concerned after reading the Sun-Times' series on the program in January. "It certainly caught our attention. That's for sure," Anderson said.

"It raises some obvious questions," Anderson said. "There may be agreements between organized crime people and politicians that make it difficult for the union to do anything about it."

"We think non-union labor is a vehicle that can be used against the interests of the union," Anderson said, speaking generally.

Szymanski said it was "ridiculous" to suggest the Teamsters didn't care about the sub-union wages being paid to workers in the Hired Truck Program. He pointed to a lawsuit that was filed by Teamsters Local 731 and remains on appeal.

"They went to the City of Chicago and said, 'How can you do this?' And when they didn't get any satisfaction or any results . . . they filed a lawsuit," Szymanski said. "So the idea that the Teamsters haven't protested it or haven't done anything about it is ridiculous."

Local 731 sued the Illinois Labor Department to act on its own findings that 134 trucking firms in the Hired Truck Program were not paying the prevailing wage, as state law requires. The state, which contends it has discretion in enforcing the law, balked at enforcing it in this instance because it said the companies might go bankrupt if they were forced to give their drivers raises.

BY ROBERT C. HERGUTH AND CHRIS FUSCO Staff Reporters

A truck driver or warehouseman represented by Teamsters Local 710 -- with a few years under the belt and some overtime -- might pull in $52,000 a year.

Before he retired Dec. 31, longtime Local 710 boss Frank Wsol also was, on average, making $52,000 -- a month.

Wsol's $630,000-a-year salary was the highest of any Teamsters officer in the country, even James P. Hoffa, the International Brotherhood of Teamsters chieftain. He also appeared to be the highest-paid labor leader in the Chicago area, though six-figure salaries are common for top union officials here, according to a Chicago Sun-Times analysis of the most recent U.S. Labor Department wage data and interviews.

At least 160 union officers in the Chicago region each made $100,000 or more annually. At least 10 officials made more than $200,000.

Often, those salaries are significantly higher than what's paid to the dues-paying workers they represent.

Before leaving his job as a dock worker at a south suburban trucking outfit, Tom Albano made $19.90 an hour, or $45,000 to $50,000 a year with overtime. The Chesterton, Ind., resident was a longtime member -- and critic -- of Local 710 who described officer salaries as "disheartening."

Wsol and other union officials, however, said members have the right to change the compensation levels and vote for new leadership if they're unhappy. He said he was paid so much because of the long-held practice of awarding "commissions . . . based on how many members you represented, how many members you organize, etc., things of that nature.

"The perks are darn good, there's no question about it," said Wsol, 78. "Then again, the responsibility is pretty darn tough, too."

*****

A common argument for paying union bosses big money is they are, effectively, CEOs.

"If you look at a local of any size, what you're talking about is a multimillion-dollar annual nonprofit organization . . . you generally have pension funds . . . many employees," said Brian Rainville, a spokesman for Teamsters Joint Council 25.

The Joint Council represents 22 Teamsters locals in the region, covering 110,000 members. It's led by John Coli, who is paid around $300,000 a year for his work at the council and a Teamsters branch that he and a brother lead.

"It is reasonable because it is set in a democratic process," Rainville said of Coli's salary.

Still, such levels have come under scrutiny, particularly from a dissident organization called Teamsters for a Democratic Union, which regularly releases names of Teamsters officials making more than $100,000 a year.

"They say the CEOs of companies make a lot more," said TDU's Ken Paff. "Our movement doesn't agree with the comparison at all. We don't want union officials to have the same reputation as CEOs or even used car salesmen."

Indeed, the subject of leaders' pay is a touchy one. Several unions declined to return telephone calls about the issue.

Even so, it seems most agree that the excesses of the past -- which involved union heavyweights such as the late Edward Hanley flaunting cars, jets and luxury homes -- are largely gone. In several unions, leaders have frozen their salaries after the economy started to tank in 2001.

Charles Anderson, secretary-treasurer of Painters AFL-CIO District Council 30 in St. Charles said an average painter earns about $56,000 a year after health insurance and other costs are paid.

Anderson, a 21-year union leader, makes about $200,000 a year. He believes the 3,600 people in his union understand his salary in light of his responsibilities, including helping oversee about $100 million in pension funds.

Union leaders who represent public employees -- such as police, fire and teachers -- appear more apt to tie their salaries to what they would earn if they had moved up doing those jobs.

"I'm probably in the ballpark of what a district chief earns," said Chicago Fire Fighters Local 2 president Jim McNally, who earns about $120,000 a year.

Sometimes officials' pay is tied to what members make.

"Our officers make what a teacher would make, but for an 8-hour day and a 12-month year," said Chicago Teachers Union president Deborah Lynch, who earns around $111,000 a year.

*****

One paycheck that's raising eyebrows belongs to Joseph Senese, who runs the Oak Brook-based National Production Workers Union.

Senese, the son of late Teamsters boss and reputed mobster Dominick Senese, was paid $345,000 in 2002, records show. With expenses and allowances, he took home $385,000.

The membership, composed in part of landscape workers, has been at 4,500 and is reportedly growing. Still, some are stunned by Senese's salary.

"Wow," said the Illinois AFL-CIO's Margaret Blackshere, who is paid just over $100,000 a year and whose umbrella organization represents a million workers.

After Wsol's departure, some officers in Teamsters Local 710 have taken salary cuts as part of a new salary cap tied to Hoffa's salary, said the local's new chief, Patrick Flynn. The large salaries last year helped contribute to a financial crunch at Local 710.

"We ran $250,000 in the red last year," said Flynn, who represents 14,000 UPS workers and truck drivers, among other types of jobs. "We've made a commitment to our membership that that's not going to happen this year."

Select area union leaders and how much they get paid »

Laborers' "In House Prosecutor" Tapped to "Help" Teamsters' Clean Up

The Intl. Bhd. of Teamsters has hired the "in house prosecutor" for the Laborers' Intl. Union of N. Amer. (LIUNA) to set up its own system of fighting corruption.  By hiring the ethically-challenged Robert Luskin, who helped forestall a federal govt. takeover of LIUNA in the 1990s, it is reported that the Teamsters hope they will persuade federal prosecutors to end their 14-yr. supervision of the IBT.

In 1995, the Clinton Dept. of Justice dropped a nationwide racketeering suit against LIUNA.  Instead of supervision by a federal court, LIUNA was allowed to establish an "internal reform effort" to be monitored only by the DOJ of Clinton Attny. General Janet Reno.  Luskin, who was representing LIUNA, was hired by the LIUNA Gen. Exec. Bd. to investigate and remove corrupt officials from the union.  Luskin's salary and expenses, as well as those of others hired for the reform, are paid entirely by the union.

In 1999, LIUNA president Arthur Coia -- repeatedly accused of ties to organized crime by DOJ -- agreed to resign from the union, but only after an internal union trial dubiously cleared him of mob ties and found him guilty only of tax evasion.  Coia was slapped with a $100,000 fine, but was given the title of "general president emeritus" and allowed to draw the equivalent of his $335,516 yearly salary for life.  More recently, Luskin agreed to drop his investigation of Richard S. Caravetta's "possible association with organized crime" in exchange for his resignation from all leadership and employment positions with Local 2 in Chicago.  But just days after his Feb. 19, 2002 resignation, Caravetta's signature appeared on letters to thousands of Local 2 members urging them to support Democrat Lisa Madigan for Ill. Attny. General.

NLPC's report on the LIUNA "internal reform," and Luskin's problematical role can be accessed on our web site at http://www.nlpc.org/olap/liuna/failure/failure.htm.  As the Teamsters negotiate with the fed. govt. to end their supervision, union attny. Patrick Szymanski said that Luskin will be "purely a consultant" and will not be involved in the negotiations. [Detroit News, 10/30/03]

Feds Offer Deal to End Supervision of Teamsters, Hoffa Claims

Even though he endorsed Cong. Richard Gephardt (D-MO) for President on Aug. 9, Intl. Bhd. Of Teamsters president James Hoffa told the Detroit News a week later that he has received a proposal to end the Federal government's 14-year supervision of the union.  That would likely mean an end to federal supervision of union elections.  The deal would also likely replace the Independent Rev. Bd. (IRB) with an internal ethics officer to keep organized crime figures out of the union hierarchy.

The Intl. Bhd. of Teamsters has functioned under the supervision of the U.S. Dist. Ct. for the Sou. Dist. of NY since 1989. The IBT hierarchy agreed to settle a complaint by then-U.S. Attny. Rudolph Giuliani that racketeers affiliated with the Cosa Nostra organized crime enterprise completely controlled the union. Under the consent decree, the IRB was formed with broad powers of investigation over the Intl. and its affiliates, even to override internal decisions by the union hierarchy. The IRB continues its work under the supervision of U.S. Dist. Judge Loretta A. Preska (S.D.NY, G.H.W. Bush).

In his Aug. 21st column for the Chicago Sun-Times, syndicated columnist Robert Novak wrote that "no realist could imagine the Teamsters union not endorsing Gephardt, who attended law school with Hoffa and has gone down the line for the union's full agenda."  But if Gephardt does not win the Democrat party nomination, both "the Bush and Hoffa camps think at least neutrality and even a Bush endorsement is possible."

According to Hoffa, the offer came from the ofc. of U.S. Attny. James B. Comey.  Any deal to end federal control would need to be approved by Judge Preska.

Federal Judge Upholds IRB's Expulsion of Teamster Bosses

U.S. Dist. Judge Loretta A. Preska (S.D.NY, G.H.W. Bush), on Aug. 22, upheld the Independent Rev. Bd's. expulsion of two frmr. allies of Teamsters president James P. Hoffa.  Formed in 1989 to root out mob influence from the Intl. Bhd. Of Teamsters, the IRB expelled William Hogan, Jr. and Dane Passo for plotting to drive down wages for members of Las Vegas Local 631 to benefit a non-union company in which Hogan's brother had a stake.  Hogan -- whom Hoffa appointed as Intl. Representative, and Passo -- whom Hoffa actually appointed as Personal Representative to Local 631 -- appealed the IRB's May 30, 2002, ruling to Judge Preska, who oversees the IRB's work.

In June 1999, William Hogan arranged a meeting between Local 631 officials and his brother, Michael, and Rick Simon, who managed the Chicago-based United Services Companies.  In June, the two proposed that United provide non-union workers to trade show contractors in Las Vegas at less than half the hourly wage of Local 631 members, opening the door for other contractors to pay the same wages even to union members.  When the officials refused, Passo engineered complaints about the Local's leaders from his allies in the Local, and persuaded Hoffa to place Local 631 in trusteeship, under which the officials who refused to go along with the scheme were fired.  When the trustees also refused to make a deal with United, Passo, whom Hoffa had appointed Special Rep. to Local 631 in Nov. 1999, engineered their firing.

Even when the new Local 631 trustee refused to cooperate with United in 2000, United dispatched its lower-paid employees to perform work reserved for union members.  After complaints by the fired trustee reached officials in the IBT's Washington, D.C. HQ, Passo was ordered not to deal with Simon.  In March 2001, Hoffa barred Hogan from negotiating with Las Vegas contractors on Local 631's behalf.  Soon afterward, the IRB began its investigation.

Contrary to their claims that the dispute was merely about the interpretation of Local 631's contract with the trade shows, Judge Preska summarized the actual misconduct of Hogan and Passo that led to their expulsion.  In addition to Passo's machinations, the IRB found that Hogan had falsely claimed the support of IBT officials in trying to persuade Local 631 officials to accept United's proposal.  Their misconduct also refuted the contention that Hogan and Passo were only advocating a proposed contract, and that the IRB ruling violated their right of free speech under the Labor-Mgmt. Relations Disclosure Act (LMRDA). [U.S.A. v. Intl. Bhd. Of Teamsters; Application 102: William T. Hogan and Dane M. Passo, 88 Civ. 4486, U.S.D.C. S.D.N.Y., 8/22/03]

U.S. oversight of Teamsters ending?

Associated Press

The Teamsters union and federal authorities are in negotiations that could result in the end of government supervision of the 1.4 million-member union, Teamsters president James P. Hoffa said.

Fixing Pensions

Tuesday, July 15, 2003; Page A18

THE U.S. PENSION SYSTEM -- what's left of it, that is -- is in sad shape. While many employers have moved away from offering workers fixed pensions, about 34 million current and retired employees are still covered by such plans, and many of them are woefully underfunded: They don't have nearly enough money set aside now to cover their eventual costs. According to the Pension Benefit Guaranty Corp., the shortfall totals more than $300 billion. The airline industry has $26 billion in underfunding, the auto industry more than $60 billion.

The problems stem from the declining stock market (which has devastated the assets of many plans) and low interest rates (which require the plans to have more money on hand to fund future costs). Now, some in Congress are pushing a "fix" that would, in essence, define part of the problem away by reducing the amount of money that companies have to put into their plans. This approach -- contained in a measure proposed by Reps. Rob Portman (R-Ohio) and Benjamin L. Cardin (D-Md.) -- would ultimately put more funds at risk of not having enough money to pay workers what they are owed.

The central issue involves the interest rate that companies use to calculate how much they must pay into plans. Companies argue, and with some justification, that the current rate, which is tied to the 30-year Treasury bond, is so low that they are being required to put too much money into the plans to cover future liabilities. This is a problem because it drains cash away from other uses and risks driving companies to freeze their plans or drop them entirely. But the proposed replacement -- a long-term corporate bond rate -- would go too far in the opposite direction.

The administration has put forward an alternative that deserves serious consideration. It would use the corporate bond rate for two years, an approach that has multiple benefits as a short-term remedy. It would help companies during an economic crunch, ease a transition to a different system and, perhaps not coincidentally, keep pensions from becoming an election-year headache. After that period, however, firms would have to adopt payment rates more directly linked to the composition of their own workforces. The notion is akin to certificates of deposit that pay different interest rates based on their maturity dates -- the shorter the holding period, the lower the rate. Under this plan, companies with a greater proportion of older workers would have to pay into their funds based on lower interest rates -- in other words, they would have to ante up more money because their costs come due earlier. The administration, commendably, also wants to beef up disclosure rules that would let workers know the true financial state of their plans.

There are many wrinkles to be worked out -- for example, how to make certain that workers who take lump-sum distributions are treated fairly by lower rates. But the first step to fixing the pension system is to work out an approach based on factual, accurate projections of future costs, not convenient fictions that may boost corporate profits now but create more problems down the road.

Truckers must rest longer between shifts
Associated Press
Posted April 25, 2003

WASHINGTON - The government says a new requirement that truck drivers rest two more hours between shifts will save as many as 75 lives annually by reducing fatigue-related accidents.

Safety groups and the truckers' union dispute that. They say the benefits from that change will be offset by another: Allowing the drivers to spend up to 11 straight hours behind the wheel, one more than now permitted.

"An extra hour of driving time will just add to driver fatigue," said Rob Black, spokesman for the International Brotherhood of Teamsters.

The changes, announced Thursday by Transportation Secretary Norman Y. Mineta, are the first for truck drivers since 1939. Mineta said they could lower the cost of moving freight by 1 percent and mean a yearly economic benefit of almost $100 billion in increased productivity.

Drivers will have to rest at least 10 hours between shifts, two hours more than now, while also getting the chance to stay on the road an hour longer. The changes take effect Jan. 4.

David McCorkle of McCorkle Truck Line in Oklahoma, the former head of the American Trucking Associations, said the trucking industry supports the changes.

"We can live with this one," he said.

Federal officials decided not to require breaks during driving shifts, which the trucking association said are unnecessary. The group conducted a survey three years ago and found that truck drivers automatically take breaks because they have to eat and use the bathroom, said David Osiecki, the association's vice president for safety and operations.

"Rest breaks are built into a driver's day," Osiecki said.

The National Sleep Foundation objected to provisions that allow drivers to be assigned nondriving duties, such as loading and unloading trucks, after they have driven for 11 hours.

"Eleven hours of driving time might be fine, but three hours of nondriving duties is getting away from what the established research says is safe," said Darrel Drobnich, a foundation spokesman.

The new rule does not require trucks to have on-board recorders, which keep track of wheel movement. Drobnich called that "ludicrous" because the devices, which he said cost about $300, would allow the government to better enforce driving regulations.

Annette Sandberg, acting administrator for the Federal Motor Carrier Safety Administration, said there is a problem enforcing the hours-of-service rules. But, she said, the recorders are not tamperproof and could infringe on a driver's privacy. Law enforcement officers also cannot check the information on the devices, she said.

The agency plans to research new technologies that could be used to record a truck's movement.

The number of people who died in large truck accidents declined 3.5 percent last year, from 5,082 in 2001 to 4,902 in 2002, according to preliminary government estimates released Wednesday.

Changes ahead for OT pay
Associated Press
Posted March 28, 2003

WASHINGTON - New government definitions of white- and blue-collar workers proposed Thursday would drastically change the types of jobs entitled to overtime pay, making eligible millions of low-income employees but cutting thousands of professionals.

Nearly 22 million workers could be affected by the Labor Department's plan, which would be first overhaul of the nation's overtime rules in more than 50 years.

About 1.3 million lower-wage workers now exempt from overtime pay for working more than 40 hours a week would be required to receive it or a salary hike. But at least 644,000 well-paid, professional employees, such as some engineers, pharmacists and insurance claims adjusters, would lose theirs in the proposal, which was submitted Thursday for a 90-day public comment period.

Millions of other workers would gain and lose under the new regulations, though their status isn't clear. Industries most affected by the changes would be construction, retail, health care, business services and personal services.

Overtime pay is just one area of the nation's labor laws that the Bush administration is tackling at the urging of business groups. The Family Medical Leave Act, job training programs and unemployment insurance also could be overhauled.

Employers have been pushing for changes in overtime pay regulations because of mounting lawsuits. Workers filed 79 federal collective-action lawsuits seeking overtime pay in 2001, surpassing for the first time class-action job discrimination suits against employers, according to the American Bar Association.

Businesses and labor unions agree that the current regulations of the 1938 Fair Labor Standards Act and last updated in 1948, are confusing and antiquated. But they disagree about how to update standards that determine what jobs must receive an hourly wage of time-and-a-half for working more than 40 hours a week.

Almost 110 million workers are covered by the law, or about 80 percent of the work force.

Union ranks shrinking, federal report says

News comes as workers agree to concessions

By JOEL DRESANG and THOMAS CONTENT
jdresang@journalsentinel.com

Last Updated: March 5, 2003

Against a backdrop of more Wisconsin factory workers giving back wages, benefits and pensions to try to keep their jobs, a new federal report shows that union membership continues to recede.

Steelworkers at Rexnord Industries in West Milwaukee voted Wednesday to accept pay cuts and other concessions to keep their chain assembly jobs at the company's West Milwaukee plant, 4800 W. Mitchell St.

The workers are giving up $3 an hour in wages on average, though for some workers - who were paid on an incentive basis until now - the concessions are far greater, said Douglas Drake, staff representative for the United Steelworkers of America District 2.

Likewise, autoworkers at AxleTech International in Oshkosh have agreed to cut their wages, to pay more toward health insurance and to drop medical coverage for retirees. They did it with the hope of sparing themselves from the same fate as about 900 cookware makers in Manitowoc whose jobs will move to Mexico in the next six months.

Todayin Marinette, boilermakers who have been on strike against rising health care costs are voting on a contract that would, for the first time, make them shoulder some of those expenses.

Amid such turmoil among industrial workers, data released last week from the U.S. Bureau of Labor Statistics show union ranks kept shrinking 2002, declining by 280,000 workers to 13.2% of the work force from 13.4% in 2001 and 20.1% in 1983, the first year comparable figures are available.

In Wisconsin, union membership dropped by 22,000 to 15.6% of all workers, down from 16.2% in 2001.

According to the report, Wisconsin remains in the upper to the middle tier of states for unionized workers. Although it ranked 16th largest in overall employment last year, Wisconsin was 12th in number of union members (398,000) and 12th in workers represented by but not necessarily members of unions (420,000).

Unions have suffered from their concentration in manufacturing industries whose ranks have fallen to cheaper competition abroad and labor-saving technology, said John Heywood, a labor economist at the University of Wisconsin-Milwaukee.

"To some extent, Wisconsin is more heavily invested in the traditional manufacturing industries. The declines that have hit those industries have hit us harder," Heywood said.

David Newby, president of the Wisconsin State AFL-CIO, agreed.

"Our numbers do tend to be worse than the national average because that's where the job loss is," Newby said.

Workers at Mirro, the aluminum cookware company that's closing in Manitowoc, were told that the company needed to save more than $12.5 million a year in order for the costs associated with the plant to be comparable to the operating costs of the company's new plant in Mexico, said Robert Glaser, director of the Steelworkers District 2.

In Oshkosh, after AxleTech International bought ArvinMeritor's axle division, the new owners told United Auto Workers Local 291 that it was preparing to close the plant and move it to North Carolina, Tennessee or Mexico if the workers did not provide contract concessions.

In January, workers voted to accept wage cuts that dropped their pay by $2.50 an hour, to $16.50, union President Alan Sawitski said. Also, the workers agreed to give up company-paid health insurance for retirees.

Increasingly, health care costs are at the heart of contract tussles between workers and management, as has been the case at Marinette Marine, a subsidiary of the Manitowoc Co.

Members of the Boilermakers Union Local 696 went on strike in January to protest the health insurance requirement. In the contract proposal being considered today, union President Steve Gromala said, "There is a health care cost now, but the wage package takes care of the cost that there would be, as well as still gives the members a very fair raise."

At Rexnord, company officials released a statement Wednesday confirming that the company will reverse an earlier decision and will close a plant in North Carolina to keep the West Milwaukee chain assembly operations open.

"Clearly the competitive pressures facing the business dictated that extraordinary efforts would be required," company spokeswoman Nancy Stadler said in the statement.

Drake said union members are always reluctant to give concessions but did so in this case based on the company's commitment to close the Morganton, N.C., plant.

"That gives us, to some degree, a bit more control over our destiny here in Milwaukee," he said.

TEAMSTERS (IBT)
Teamster-Financed Study Claims Fed. Oversight No Longer Necessary
In an internal report costing more than $2 million, the law firm of Stier, Anderson & Malone claims that the Teamsters union is no longer dominated by organized crime racketeers, and that "the time is ripe" to end the federal govt's supervision of the union.

The Intl. Bhd. of Teamsters has functioned under the supervision of the U.S. Dist. Ct. for the Sou. Dist. of NY since 1989. The IBT hierarchy agreed to settle a complaint by fed. prosecutors that racketeers affiliated with the Cosa Nostra organized crime enterprise completely controlled the union. Under the consent decree, the Independent Review Board (IRB) was formed with broad powers of investigation over the Intl. and its affiliates, even to override internal decisions by the union hierarchy. The IRB continues its work under the supervision of U.S. Dist. Judge Loretta A. Preska (S.D.NY, G.H.W. Bush).

The report, commissioned by the Teamsters and released Oct. 3, argues that the govt. monitoring "allowed the International Brotherhood of Teamsters to change course," and that under IBT president James P. Hoffa's leadership, "the union has institutionalized its commitment to cultural reform through union-defined and enforced standards of conduct." The report's authors concede, ‘[w]hat constitutes reform, however, can be a contentious subject...As a political tactic, those out of power often describe themselves...as ‘reformers' regardless of whether any changes that would occur through their ascension to power could properly be termed ‘reforms.'" A recent case involving of Hoffa's closest allies illustrates that dilemma.

On May 30, the IRB barred William Hogan, Jr., Chicago's most powerful Teamster, from the union for life due to a plot to drive down wages and benefits for Las Vegas IBT Local 631 to help a Chicago-based firm in which his brother had a stake. Also banned for life was Dane Passo, a Chicago Teamster who became Hoffa's right-hand-man at IBT headquarters in Washington.

The IRB ruled that Hogan and Passo colluded with United Serv. Companies to have the firm's nonunion employees perform work at Las Vegas trade shows and conventions at less than half the hourly wage of Local 631 members, thus allowing other contractors to pay the same wages even to union workers. Hogan's brother, Michael, was United's vice-president. Reportedly, Hogan and Passo engineered Hoffa's firing of Local 631 officials who opposed the deal. Only when IRB began investigating did Hoffa stop Hogan and Passo's campaign. Hoffa responded to warnings about Passo's links to organized crime by one of the report's authors, Edwin Stier, by raising Passo's salary and keeping Passo as his "special representative" to the besieged Las Vegas Local.

"With the Independent Review Board still forced to take action against corruption in the Teamsters union, it is highly premature to end federal supervision of the union," said David Kendrick, Director of NLPC's Organized Labor Accountability Project. [The Teamsters: Perception & Reality. Stier, Anderson & Malone, LLC: The New Republic, 4/8/02]

Teamsters elect Coli as council president

BY FRANCINE KNOWLES BUSINESS REPORTER

William Hogan Jr., head of the 100,000-member Teamsters Joint Council 25 and at one time a running mate to international president James P. Hoffa, has been permanently barred from the union for corruption.

The Independent Review Board barred Hogan and Dane Passo, special assistant to Hoffa, from working or holding membership in the union. The board ruled the two colluded with a non-union placement company in Chicago, where Hogan's brother was an executive, to help the company land convention and trade show work in Las Vegas that could have gone to Teamsters Local 631 members there.

Under the scheme, the workers from United Services would get less pay and benefits than the Teamsters contract requires when outside workers are used. Workers would get $8 per hour, compared to the $12.49 an hour the contract requires.

"Passo's and Hogan's actions, which Local 631 officials fought, were designed to benefit United and the trade show contractors, including Hogan's brother's company," said the IRB decision.

"There was no benefit to Local 631, its members or the United employees. In fact, they were repeatedly harmed."

The decision followed a hearing, in which Hogan and Passo denied wrongdoing. Hogan and Passo did not return calls for comment.

The international union declined comment.

"It's a welcome decision to have these top Hoffa aides who were found selling out members to be removed from the union," said Ken Paff, organizer with Teamsters for a Democratic Union, which has fought corruption. "This ... would have undermined a contract for 1,100 Teamsters."

Hogan was Hoffa's running mate in 1996 against a ticket headed by then-union international President Ron Carey. Hogan, who at that time headed Teamsters Local 714 and the joint council, stepped down after the international suspended him and placed the local under trusteeship. The international accused Hogan of steering higher-paying jobs to family members and friends, and failing to run the local democratically.

The local represents thousands of workers at McCormick Place and the Rosemont Exposition Center.

Hoffa Rams Through Dues Hike 

Increase begins in July.

Convention delegates overwhelmingly approved the Blue Ribbon Commission's proposal for the largest dues increase in Teamster history at the Special Convention in Las Vegas on Tuesday, April 30.

In local union meetings and in private conversations, many Hoffa delegates said that they opposed the dues hike and supported members’ right to vote. But on the Convention floor, where it really counted, only TDU and the reform movement stood up for the rights of working Teamsters.

The Convention was closed to members and the media. Inside, the Hoffa delegation was mob-like and fanatical.

They booed delegates who proposed that members have the right to vote on the dues increase. They said members who are against the massive dues increase want the union to be weak. They denounced all opponents of the dues hike as not real Teamsters.

When the dues hike hits members’ paychecks in the beginning of July, many local officers who are Hoffa supporters will claim the International is to blame.

But the record shows that these same officers sat on their hands when they had the chance to do something about it.

Report ties 2 Teamsters to non-union scheme

William Hogan Jr., Chicago's most powerful Teamster, improperly tried to steer Las Vegas convention jobs away from Teamsters to lower-paid, non-union workers supplied by his brother's temporary labor firm, a union oversight panel charged Thursday.

The investigators charged that Hogan and Dane Passo, a personal aide to Teamsters President James P. Hoffa, put pressure on Local 631 in the Nevada city to shift jobs to Chicago-based United Services Companies, where Hogan's brother Mike was an officer.

Mike Hogan, in turn, offered along with another United official to pay thousands of dollars in kickbacks to officials of the local to go along with the scheme, investigators alleged.

Although the local never accepted the deal, it gave some work to the firm, stirring union members' complaints, according to the 192-page report.

Several officials with Local 631, who opposed the plans also lost their jobs with the local and in one case received anonymous threats, investigators said.

If the union's executive board upholds the allegations, it could call for Hogan and Passo to be expelled from the union. Such an order also could come from an independent review board, created in 1989 under a federal court order as part of a consent decree between the Teamsters and the Justice Department.

Tough time for Teamsters

The charges come at a critical time for the powerful 1.4 million member union, which has been trying to shed itself of the oversight panel by showing that it is now corruption free.

The charges also come only months before Hoffa faces a re-election challenge from union reformers, who predicted that the allegations would support their claim that the union is still riddled with wrongdoing.

"This was called to the attention of Hoffa a long time ago, and he did nothing against his top lieutenants," said Ken Paff, head of Teamsters for a Democratic Union, a small dissident movement based in Detroit.

Hogan's union career

Hogan called the allegations "ludicrous."

In 1996, he stepped down as Hoffa's running mate in national union elections because of a union inquiry into nepotism and favoritism in his power base, Local 714 in Chicago. Hoffa, son of long-missing Teamster boss Jimmy Hoffa, lost that election but won in 1998.

"They never could charge me last time," said Hogan, 60, , who was stripped of his leadership of Local 714 by union officials in 1996. Investigators at the time had claimed that the local was "run for the benefit of the Hogan family and friends."

When Hoffa finally gained the union presidency in 1998, Hogan and several relatives also regained control of the local, which had been established more than six decades earlier by Hogan's father. The son of William Hogan was elected as the head of the local in 1998. Soon after, William Hogan and a brother James were returned to positions with Local 714.

Since then, Hogan has consolidated even more power in the union. He currently serves as the organizing and political director for Local 714, is an international union representative, the president of Joint Council 25 for Chicago-area Teamsters' locals and vice president of Local 179 in Joliet.

His various union salaries add up to $210,000 a year, according to the investigators' report.

Passo, 48, ran Hoffa's campaign effort in Chicago, and later became Hoffa's special assistant. He lost that title last October but has continued with the same duties, the report said.

Power shift in Las Vegas

Last year, after Hogan's initial approach to Local 631, control of the local was taken by Hoffa and handed to a trusteeship that Passo was assigned to oversee. He spent months in Las Vegas and kept in close contact with Hogan, the report said.

Neither Passo nor Mike Hogan could be reached to comment. Teamsters officials in Washington also declined to comment on the allegations.

Local 631 runs a hiring hall for workers who set up conventions and do custodial work at the mammoth shows in Las Vegas. Since Nevada is a right-to-work state, the union hall is also open for non-Teamsters.

When the local can't find enough Teamsters, it first turns to other unions for help to fill jobs and, if that doesn't suffice, can then seek non-union help, said Tim Murphy, the local's former leader.

The alleged scheme to benefit the temporary labor firm began in June 1999 when Hogan set up a meeting for his brother's firm with officials at Local 631, according to the report.

Hogan told the Tribune that he set up the meeting to help out the local because it could not always find enough workers for "big shows." He also said he had hoped that the non-union workers would become Teamsters.

According to the investigators' report, however, the local rarely had to go outside its membership to fill jobs at conventions. The report also said Passo made no effort to organize the workers.

The report highlighted that first meeting between Michael Hogan, Richard Simon, the CEO of the United labor firm, and two of the local's officials, including Murphy. At the meeting, Michael Hogan and Simon allegedly proposed that the local hire workers through United. While the rate for Teamsters was $20 an hour, the company hired mostly Hispanic immigrants for much less.

"Only Simon and, perhaps, the contractors who used his company, benefited from the cheaper labor," the report said.

'Too close to being illegal'

In a Tribune interview, Murphy said both of the company officials said the deal would pay off for the local and its officials. "When they talked to me, they mentioned a service fee that would be kicked back to the union or whatever, and that is when I walked out," Murphy said. "I felt that it was too close to being illegal. I wasn't going to sell out the members."

He recalled the company officials saying they paid their workers about $7 an hour, but charged conventions about $13.

Murphy lost his job with the local in April 2000 when Passo arrived. A month later, he wrote to the U.S. Labor Department and the independent investigators, detailing his allegations about the hiring scheme.

Simon said he had not seen the report and could not fully comment. But he called the charges, "the most blatant distortion of facts that I have ever seen or heard."

CHICAGO'S LABOR ELITE

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Last modified: May 22, 2004