Hands in the Till Prompt Oversight of Big Verizon Local

A New York City telephone workers local will be overseen by a monitor, after a union investigation revealed top leaders engaged in “a number of highly questionable practices involving compensation.”

The action by the Communications Workers’ national executive board is not a trusteeship and allows Local 1101’s November election to proceed on schedule. The board also upheld charges, filed by reformers in the local, alleging violations of democratic process at membership meetings.

Local 1101 has 7,000 members, mostly at the telecom giant Verizon, where the contract for 50,000 members on the East Coast expires in August.

A union-appointed prosecutor and financial investigator revealed in a report released March 24 that local officers and executive board members granted themselves $225 a week in unreceipted expenses—a cumulative cost of $156,000 annually for the union’s top leaders.

The expenditure, which was never approved by members, was explained as covering costs for gas, mileage, insurance, and tolls, although the local also paid out up to $37,000 a year in car service costs.
Local leaders also gave themselves a 401(k) plan with a contribution equaling 15 percent of salary. The contribution was paid for by members’ dues—again without seeking member approval.

The investigators’ report criticized the “imprudent use of local funds,” noting that officers charged meal costs that averaged more than $225 per meal and hotel rooms that cost $600 a night during out-of-town conferences.

Other allegations of financial impropriety raised by three incumbent board members in a March 1 request for a trusteeship were shunted to the side, awaiting the resolution of a Department of Labor investigation.

Al Luzzi and Joe McAleer, Local 1101 vice presidents, and business agent Pat Gibbons claimed that officers routinely charged both the local and the company for 40 hours of work per week, and had done so for decades. CWA investigators tried and failed to access Verizon payroll records to settle the claim of double-dipping. Neither would officers turn over tax returns to settle the matter.

But the DOL, unlike the union, has the power to subpoena records.

Contract Fight, Then Election

Reform candidates hailed the move, saying it would ensure a level playing field for the fall election.

“This will keep a check on the executive board,” said Kevin Condy, a candidate on the Rebuild 1101 reform slate. “It ensures there will be no crazy spending going on and that our democratic rights are respected.”

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CWA’s decision to monitor the local instead of trusteeing it fits into a pattern within the union.

After incumbents in CWA Local 1400 in New England stole an election eight years ago, the national union took the election process out of the hands of local officers, and a slate headed by reformer Don Trementozzi swept into office in a re-run.

Supporters of the approach, like former CWA staffer Steve Early, say it allows rank-and-file leaders inside locals to reclaim their union when it goes astray, instead of depending on outside trustees appointed by national officers.

Reformers inside Local 1101 have a long history of standing up for their rights.

Condy, along with fellow candidate Al Russo, filed charges after a November membership meeting where incumbents turned aside members’ wishes on a referendum vote.

Almost 900 members turned out to tell officers that they wanted to separate the eight proposed bylaw changes in the referendum and not vote them as a block. One would have sweetened members’ pensions and was a sure-fire win, while another reshuffled representation posts to the incumbents’ advantage. The challengers voted for a line-item ballot, but incumbents sent one out with a block-vote option anyway.

The referendum, which passed in January, was overturned by the national executive board. Incumbents may yet try again.

While the installation of a monitor is something of a vindication for the Rebuild 1101 slate, which has been chipping away at the incumbents for years, the timing is painful.

Contract talks promise to be tough, with Verizon likely to copy its competitor AT&T, which forced major health care cost-shifting onto CWA members two years ago.

With just five months before contract expiration, the challengers are reaching out to chief stewards aligned with the incumbents to present a united front against the company. Russo said they will join up for informational picketing before work and during lunch on April 4, the AFL-CIO’s national “We Are One” day of action, and then march together to a rally at City Hall after work.

“Nobody is happy about this embarrassment,” Condy said. “But the union is strong enough to sustain this.”

Mischa Gaus was the editor of Labor Notes from 2008 to 2012.mischagaus@gmail.com
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Comments

Pamelagalpern (not verified) | 04/19/11

In a previous post Ed Rosado asks “What is Rebuild 1101's plan for reform”? The program we've put forward for reforming the Local is based on the principle that an educated, mobilized membership is the backbone of a strong union. Rebuild's platform calls for the following changes.

We need regular membership meetings with real information, discussion and debate. We need local-wide contract mobilization campaigns that start early, ramp up, and get as many members involved as possible. We need a local-wide campaign to fight contracting out, a huge threat at the moment. We need to make organizing Verizon Wireless and other new telecom jobs a priority. We need to rebuild our stewards’ network. We need to revamp our grievance procedure. We need to provide better representation for ALL our members, including AT&T Mobility workers who have been underrepresented for years. Given the results of the recent national investigation, we need to implement a program for financial reform and accountability at the Local. And we need to bring democracy back to the Local. We need to make sure every shop has elections for stewards and chiefs, and make sure members' democratic rights are protected.

In the past year Rebuild has led the way in showing that members are willing to fight to protect our jobs. 900 members came to a membership meeting, the first quorum in years, to make their voices heard. Members stood up to leaders who are violating members democratic rights and forced the national union to look into financial wrong-doing at the local and take steps to end abusive practices. We are building a movement of members who want to see real change in the union. In my book that’s a reform movement.

edward rosado (not verified) | 04/20/11

Pam,

welcome to the discussion. :-)
(oooo . . . do yourself a favor
if you can't deal with diatribes
skip down to the part where i plug
Labor Notes Books)

my guess is that there are at least nine more o'ya
on the way. is it okay if we spread them out a bit.
there's only one of me.

just kidding. i really did not intend for this to take over
Labor Notes. but i'm glad that you joined because
finally someone addresses the issue, somewhat.

are the re-builders a reform movement?

based on what i've just read - in your book, they are.

in your book.

should i argue? of course not. you are entitled to
an opinion. and, . . . you've given some darn good reasons to support it.
something i find refreshing in the discussion thus far.

thank you.

now, lets be frank, shall we?

you've listed a set of things that we "need".

we'd be hard pressed
to find anyone who disagrees with much of your list.
i would add a few "things that we need" myself,
but that not the issue, is it?

this is a commendable list of wants and needs,
it's a start. but its not a plan.

like other lists of things that we need:
world peace, an end to poverty,
a chicken in every pot and a good five cent cigar . . .

this list lacks a commitment to detail.

without strategy and tactic it is just
political pabulum.

and just what is political pabulum meant to achieve?

you got it: getting elected.

now, i could go on and on about
the characteristics of a reform movement,
but who am i to lecture anyone?
especially you Pam, someone i admire as a
somewhat progressive labor activist.

its a pity that you've been drawn into the illusion.

once we get past the rah-rah-rah,
we see what my point is,
that these candidates are by and large
a card-carrying product of the status quo.

they are reformers because they say they are,
they go to all the righ...er...left meetings,
they attend labor classes, rah-rah all the rallies,
anything to endear themselves to anyone who
can help them get elected.

yet they have no PLAN for reform.

and do you know why they have no plan?

it is because though
single-minded support is welcome,
and a lower level of dissent is tolerated,
the rebuilders lack the machinery,
or the will to allow a grass-roots building of a platform
by the people "under them" as they say.

an anecdote:
at a Labor Notes Conference a couple of years back
Al, Kevin, Myself and others had occasion to
listen to Rafael Feliciano speak on his experiences
with the FMPR struggles in Puerto Rico. with tears in his eyes
Feliciano spoke in heavily-accented english about the 2008 strike
by 40,000 teachers.

i will spare you the comments
made afterwards by these so-called reformers.
suffice it to say that they are NOT progressives, Leftists,
or anything closely resembling the people who spoke
at the Conference.

instead i'll quote Steve Early, if i may.

in his latest MUST-READ book THE CIVIL WARS IN U.S. LABOR,
Steve writes about Rafael Feliciano's presentation with what can
only be called reverence.

and, Steve focuses on what he calls
the Puerto Rican Lesson :

". . . term limits for officers and the importance
of union leaders being paid no more than the members they represent
. . ."

and he quotes Feliciano: "a union's militants are more important
than money."

Early credits this line of thought for FMPR's successful
2008 labor campaign against the Commonwealth Governments'
union-busting efforts with little funding but much commitment.

now, that's a plan and that's successful reform.

here, watch what reform looks like:
change the by-laws to include term limits so that:

elected officers must concern themselves with mentoring their replacements,
and with increasing member participation, because the officers MUST go back
to the rank-and-file workplace when their terms are concluded.

eliminate any remuneration above top-craft's,
(okay maybe an extra 10% for those who need
a profit motive. i know, i know, you may lose 90% of the slate.
not necessarily a bad thing.)

THIS is how we "implement a program
for financial reform and accountability".

According to Mike Parker's DEMOCRACY IS POWER
(available from Labor Notes for a tidy $17)

elimination of executive pay in excess of top-crafts'
results in the following:

-members will not choose to run for office for the pay,
hmmm, again . . . try running this by your heroes.

-leaders' standard of living will be the same as for
the rank-and-file they represent
i.e. they'll have the same problems

-the financial cost of losing office will not be as
great, so the pressure to hang on to a position by suppressing
democracy will be lessened.

- a great organizing campaign that says our leaders make the
same as our members. that'll get 'em in the door, eh Pam?

(gotts'ta luv LABOR NOTES BOOKS, no?)

o'course these are only some possibilities,
there are thousands of suggestions just waiting
to be elicited from the membership and in
the process "bring democracy back to the Local."

but, i've already said way too much,
the audacity! no profit?!?

in a nutshell,

1) the so-called reformers have no plan for
reforming, nor for rebuilding. what they do have is a list of
attention getting slogans, and an amazing gift for
glad-handing and name-dropping.

2) the entire financial fiasco
was not brought to light by the re-builders,
though they've certainly exploited it.

the actual light-shedding, if you will,
was by er, uhm, current Executive Board Members
who wrote a 37page letter of complaint to
the national union. in essence the E-Board
is attempting to re-form itself. pun intended.

3) if i can badger folk into offering improvement,
or into stopping the suicidal mudsling,
it'll be worth the nausea.

look, i've got personal issues to deal with
at the moment. so, if'n yer gonna queue up
in indignation. yer gonna have to wait until
my mom finishes dying, i promise i won't
ignore you forever.

in closing,
or, enclosing . . .uh . . .

if your intention is to reform
get a plan, it'll help ya get there.

if the only this that's gonna change is the
faces, well, no thanks. i'll stick with
the devil i know, he knows more because
he's an old devil than he knows by
virtue of being the devil.

in solidarity
{no, i mean it}
ed rosado (to Pam)
MR.ROSADO (to the rest'a ya)

..
.

edward rosado (not verified) | 04/15/11

Someone who runs an election on the basis of "those guys are crooks, vote for me" is not by definition a reformer. A contender perhaps, but reformation requires more than a vague promise to safe-guard the cookie jar. Where is the plan for reform?

Are we promised term limits so that we do not have to be eternally saddled with careerists?

Are we promised reduction in executive pay?

is there a plan to counter-balance loss of union dues?

Or a willingness pay for Shop Stewards who are the ones who do the heavy lifting day-to-day and are
currently paid the equivalent of $3 a week as compensation for attending quarterly meetings?

Are we promised an end to cronyism in appointments to committees?
Or in appointing chiefs? Or in appointing stewards?

How will the reformers increase attendance to membership meetings?
Aside from the "keeping the membership energized" pabulum do they have an actual plan?

Does their vision include opening up past grievance case files to the Chiefs, or the Stewards,
or perhaps to the members?

Do they intend to provide documentation to the members of resolution to their grievances?

The "reformers" proclaim transparency,
Yet what are the specifics of a promised rebuilding of the local?

In spite of rhetorical flourishes mined from Jack Kennedy, Barack Obama and a bat-wielding Carl Palladino there is no concrete evidence of a plan for reform other than an even more vague plan to get elected. a plan which they've worked at almost exclusively for the three years since they were last rejected by the rank-and-file.

These are not reformers these are disgruntled hangers-on who were happily conformed
to the status quo until they no longer profited by the privilege of proximity. They themselves were, in fact, not initially elected to their current positions, but rather they were appointed by the current e-board and where was the outrage then?
Cura te ipsum.

Vinny Galvin (not verified) | 04/19/11

First of all the Rebuild team is not running on the premise of “those guys are crooks” We as Rebuilders are running on the premise of change. The Rebuilder team is Chiefs, Stewards and Members who want to help build a stronger union. We are proud members who are concerned about the future of our local and believe we need to rebuild and reorganize our union. In addition those same Brothers and Sisters have experience and have been better themselves by attending Cornell University ILR program and the Murphy Labor college so they can be ready fro the challenges that will await them in the future.
As far as a safe guarding the cookie jar there will have to be transparency and that you will see from the Rebuilders. As far as term limits are concerned as long as there are fair and I mean fair and honest elections the membership will decide who are worthy to be elected or reelected time and time again. When you talk about Executive pay our by-laws dictate what that will be how any one can promise you anything if it is in the by-laws. When you talk about a plan to counter balance a loss of union dues the local will save thousands of dollars a year for the fact the Rebuild team can get joint conference time and on the current E-Board only two can receive it. Now I see you are concerned about the local’s funds but yet you are concerned about stewards getting a raise. As a whole some stewards deserve a raise for the great work they do but there are many who don’t do a thing. I believe a hard working steward should be compensated either by be being placed on a committee or we as a local should come up with a plan for an increase for the stewards who make a difference.
When we talk about appointing Chiefs or stewards there should be always be an election. As far as being appointed to a committee a member is rewarded for the hard work they have done and who have the same goals for a better local. Another point you bring up is membership meetings and how attendance can be increased. The question you have to ask yourself is who you want at our meetings. Do you want just Verizon or the whole family of companies that belong to Local 1101? Since we are spread all over the region it’s hard for all of us to get together. When you do finally have a membership there must be real substance at these meetings because if there is not no one will come back. So enclosing the Rebuilders are here changes will come to what degree it will be up the membership. Also I am not disgruntled hangers-on I am a true unionist with a vision and along with my Brothers and Sisters this will be done.

In Solidarity

Vinny Galvin
Proud Rebuilder 1101

Kevin Condy (not verified) | 04/18/11

Reform is defined as
Noun
1. The improvement or amendment of what is wrong, corrupt, unsatisfactory, etc.:

Verb (used with object)
2. To change to a better state, form, etc.; improve by alteration, substitution, abolition, etc.

All journeys begin with a first step. While you are not satisfied that a promise to safe-guard the cookie-jar is enough and more is required I must assume that you believe that the ‘cookie-jar”, in this instance, our dues money needs to be safe- guarded.
I will take that as an acknowledgement that the Current Executive Board has not safe-guarded it.

Everyone is entitled to their own opinion but they are not entitled to their own facts.

Lets list the FACTS:

• The REBUILD1101 Team is informing members of events concerning Our Local
• The CWA Executive Board in Washington assigned a Monitor to our Local to oversee finances and other duties.
• While investigating claims of wrongdoing, the investigator discovered even more "troubling" practices.
• The CWA’s investigation FOUND the Awarding of a weekly expense allowance of $225 to each officer and Executive Board member over and above their regular compensation and over and above their entitlement to reimbursement for certain other, documented expenses
• The CWA’s investigation FOUND the Establishment of a 401(k) Plan for officers and Executive Board members to which the Local contributes fifteen (15%)of their annual compensation (including the weekly expense allowance) each year. This Plan has not ever received specific approval by the membership even though it also represents a significant amount of additional compensation to these individuals over and above that specified in Article XXII of the local's Bylaws.

Local 1101’s By-Laws contains the following:
ARTICLE XXII
COMPENSATION FOR UNION BUSINESS

A) Any member of the Local shall receive compensation commensurate to the highest basic weekly wage of his respective craft for any period of time that he is engaged in duly authorized business of the Local.

B) The local Executive Board shall be compensated at an annual rate as follows:

Officers and Executive Board members shall receive compensation commensurate to the highest basic weekly rate of top craft for any period of time that they are engaged in duly authorized business of the local.
Officers and Executive Board members shall not be entitled to overtime compensation under any circumstances

C) In addition to the compensation provided in Paragraph (B) above, the Officers and Executive Board
members shall be compensated at an annual rate, payable in fifty-two (52) installments as follows:
PRESIDENT ………………………… 90% of top craft rate
VICE PRESIDENT ......………… 75% of top craft rate
TREASURER .........………….. 75% of top craft rate
SECRETARY .........………………… 75% of top craft rate
BUSINESS AGENT ....……………… 60% of top craft rate

Plus all benefits available to the general membership under the collective bargaining agreement covering their employment, excluding the pension benefit.

Again it states,
.....excluding the pension benefit.

The Executive Board was not entitled to ANY amount of 401k benefit.

When 15% of our money is deposited into a 401k fund (a pension fund) that was not authorized, in fact it was specifically excluded from their compensation, it is called STEALING.

You ask, “Are we promised a reduction in executive pay?”

The answer to that is yes. Re-read the above. That alone would save the Local hundreds of thousands of dollars. This money could be used to give the Stewards a raise, develop a system to better train and communicate with them and also counter-balance the loss of union dues? Ultimately the membership would decide how to spend this money. It would not be the self serving members of the current Executive Board.

Reform is also defined in the dictionary as a verb: To improve (an existing institution, law, practices, etc) by alteration or correction of abuses.

Mr. Rosado, please include all pertinent facts in your next post.

As for you ending with,
Cura te ipsum. – (cure yourself first), I believe we at the REBUILD1101 team are. We are all current and active members of Local 1101. We acknowledged that there are problems that need to be addressed within this local. If that by definition make us “reformers” than we are guilty.

Kevin Condy , Al Russo on behalf of the REBUILD1101 Team.

edward rosado (not verified) | 04/19/11

Definition:

A 401(k) is an employer-sponsored retirement plan,
sometimes called a defined contribution plan
(in contrast to a defined benefit pension plan). ...

biztaxlaw.about.com/od/glossarynumbers/g/401kdef.htm

edward rosado (not verified) | 04/18/11

Al (and Kevin),

thanks for your phone call.
{and thank you for wishing my mother well.}

in solidarity,
ed rosado

Ed Beaugard (not verified) | 03/31/11

I urge everyone to read the late Robert Fitch's book, "Solidarity for Sale", which discusses the deadly problem of corruption in the labor movement. Reform efforts will always fail if the model of "business unionism" isn't changed.

Sincerely,
Ed Beaugard