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From the July-August 2008 issue of Union Democracy Review #174

Action and inaction in the Operating Engineers

Think of a town that's plagued by deaths, arson, and robberies, and yet the mayor and police don't seem to have the time or inclination to do anything about it because they are preoccupied by a campaign to stop residents from cluttering up the streets by passing out unauthorized handbills. That act of imagination could prepare you for these events in the International Union of Operating Engineers:

Local 150: Take the 22,000-member Local 150 which represents operators of heavy construction equipment in Illinois, Iowa, and Indiana.

In August last year, William Dugan, the incumbent president-business manager, was opposed by a rival slate. The insurgents set up their own campaign website. The international office, moving against what it perceived as this acute threat to the union's well-being, announced a new policy that made the website unauthorized. From now on, candidates could establish a website only if they restricted access to members and barred all others with a secret password system. The grave danger, the international union attorney explained, was that information about the union might leak out to employers. And so the international acted swiftly and decisively to protect the union against a possibility, hypothetical and remote.

Soon after, Local 150 was overwhelmed by an avalanche of a different kind of harmful information. But this time the international lacked the time or inclination to act. Hogan headed the local for some 20 years and in that August election, he won by 8,202 to 5,329; but he never served out the term. In June this year, motivated, he said, by his wife's ill health, he retired. Actually, he resigned during federal investigations into charges of criminal misuse of union resources and of improper practices during the August 2007 election. The Chicago Sun-Times reported that, on May 30, 2008, federal agents had raided Dugan properties in Maryland in the course of an investigation.

Federal action was prompted, in part, by a private suit in January 2007 against Dugan by six members of Local 150; four are former business agents; all supported Joe Ward, the local treasurer who ran against Dugan in August 2007. They charged that for fifteen years, Dugan had forced some 125 local employees to kickback $100 a month into what he called a "Christmas Fund" which he personally controlled without accountability to anyone. Since he had the right to hire and fire, they felt compelled to comply. The six charged also that Dugan used local resources and staff for his farm in Maryland and a tavern he owned.

Dugan denied the charges, insisting that the fund was voluntary, that the money was expended in the members' interests, and that he had reimbursed the local for expenditures on his own behalf. His supporters have filed a kind of countersuit against Joe Ward, accusing him of self-dealing in a 12 year old union land transaction, which Ward denies and rejects as politically contrived.

(Meanwhile, a complaint by the Ward slate against the August 2007 election is pending before the U.S. Labor Department. The charges are familiar and, as always, must meet the burden of proof: that stewards had collected and voted mail ballots, that ballot secrecy was compromised, union resources used on behalf of incumbents, hiring hall referrals manipulated in exchange for votes.)

On July 24, came a new blockbuster, a federal private suit filed under the RICO statute by Peter and Daniel Pena, both Local 150 members. They charge that a contractor had paid $25,000 in bribes to officials of Local 150 to allow the company to underpay the Penas and to cheat union insurance funds. According to the complaint, a union auditing firm reported that the firm had underpaid the Penas by $110,546 in past wages and owed the pension and welfare funds $52,740; but, after taking the bribes, the union reps allowed the company to reduce payments to the Penas to $27,637 and the fund payments to $8,865. At one deposition, Steve Cisco, the local recording secretary, took the Fifth Amendment in answer to questions about those bribes.

And so the Local 150 story is depressing and devious. Who took or stole what or anything and from whom if anyone? These are surely important questions. What is at least as important is this fact: an international union leadership which is alert to limit the simple rights of its members on the internet, is asleep at the switch in the face of basic challenges to union integrity. If you are charged with stealing money, no need to worry about international intervention. But if you clutter up the internet with a website, watch out!

Local 793 in Toronto, Ontario: When Monti Rose decided to run for local president against the incumbent in early 2008, he hired Don Styles, an apprentice engineer, to set up his campaign website. Rose had been a local member for 18 years, worked on heavy construction equipment, and served the union as an organizer and in other positions. Like other young workers, Styles is computer and internet savvy. To his surprise, Styles was directed by the local business manager to shut down the site. Neither Styles nor Rose had ever heard about the international's new requirement for a membership password. Styles replied that as Rose's employed agent he was not authorized to close the site. Nevertheless, Rose acted promptly to comply with the spirit of the ruling without losing the use of his site during the campaign. The site was modified with a clear notice that only members were authorized to click on it for information. It was not good enough. The incumbent local president filed disciplinary charges against both Rose and Styles. Trial is set to begin in mid-September.

Local 825 in New Jersey: In March, the business manager and former president were indicted on federal charge of taking bribes of more than $110,00 to permit contractors to use non-union labor and enjoy "labor peace." Last year, state prosecutors charged that a Gambino family member was manipulating local finances and took a $20,000 bribe from a contractor who wanted to avoid hiring local members. However, no danger threatened from any rank-and-file website. There was no public expression of interest from the international.

Locals 14 and 15 in New York: The two locals, which share a hiring hall,were accused in federal court of domination by organized crime back in November 2004. Tom Robbins wrote in the Village Voice, “So far, 39 individuals, including Thomas Maguire, former head of Local 15 and Joseph Rizzuto, Sr., who was leader of Local 14, have pled guilty. Rizzuto ....describing routine payoffs between major construction firms and mob-tied officials." A month later, five top executives of construction companies were indicted on charges of bribing union officials. This summer the scandal that has been New York construction in general and heavy construction in particular erupted in all its shame when two heavy cranes collapsed in crowded Manhattan killing workers and bystanders and crushing neighborhood residential apartments. A hurried investigation followed revealing a pattern of corruption in inspection, violation of safety standards, and fraud in the issuance of licenses. These events prodded federal law authorities into action. Under pressure of these events Local 14, the union of crane operators, consented to government oversight. Two monitors appointed by Federal Judge Sterling Johnson will police the union for at least five years to get rid of organized crime.

In all this time, nothing heard from the international. No problem; the threat came only from racketeers, not from a dangerous rank-and-file internet.

One bright note:
A significant hiring hall reform in Operating Engineers L. 14

Someone in the Justice Department seems to know what he/she is doing. To combat hiring hall corruption and favoritism, the government insists that, from now on, any request by an employer to hire a particular worker by name must be made in writing. This is no small thing.

Many construction contracts give employers the right to request a worker by name, in which case that worker skips ahead of everyone else on the hiring list and goes right to work. Unscrupulous union officials misuse that practice to reward their friends and punish critics. If you protest when they refer a crony out to the best jobs, even though you are way ahead on the list, the union agent simply claims that the employer requested his buddy. That claim could be a crude lie; but without documentary proof required, how can you prove it? However, the new rule must be more than enacted. It must be enforced to make a difference.

Other articles on the IUOE:
More on labor’s lasting quest for ethical practices: from the Operating Engineers (9/08-10/08)
Action and inaction in the Operating Engineers (7/08-8/08)
Confronting corruption charges in Operating Engineers Local 3 (11/06-12/06
In the Operating Engineers (IUOE)(11/05-12/05)
Reform breakthrough in Ohio Operating Engineers Local 18(9/05-10/05)
Action in Operating Engineers locals 18 and 66(7/05-8/05)
New voices at AUD construction trades conference (1/03-2/03)
"Women's Project launches Operation Punch List" (10/00-11/00)


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