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From the November-December 2006 issue of Union Democracy Review #165
Confronting corruption charges in Operating Engineers Local 3
While leaders of New York's Central Labor Council were agonizing over what to do after their president was indicted for stealing a few million dollars from unions and assorted other sources, members of Operating Engineers Local 3 on the West Coast did not wait upon law enforcement authorities after they discovered that their business manager had misdirected the local's money. By New York standards, it was a modest amount, only $500,000. Still, it was their money. They shamed their executive board into retaining an independent investigator whose report became public property in the local. They organized an insurgent slate which defeated the business manager and ended his control over the local. Then the local sued to try to get the money back. It was not an easy undertaking. This is a construction local with over 40,000 members scattered over four states, including Hawaii. Here, according to informed local members, is how they did it:
The beginning was all familiar, but the sequel was unusual.
When Don Doser, the local business manager retired before his term of office expired, John Bonilla was appointed in his stead. Such a mid-term replacement is a familiar method for anointing a successor without running the risks of an election. In this case, however, there was a hitch. Members learned that Doser had been awarded "severance" pay by Bonilla. In many construction locals, that would have ended the story; ask too many questions and you don't work.
But Local 3 members are not easily intimidated. With the aid of information mined from AUD and the LM2 reports filed with the Labor Department, they learned that Doser had received $765,000 which, they estimated, was around $500,000 more than justified. But more! They discovered that Bonilla had paid out the money without approval of the local executive board.
After trying to shuck off responsibility, executive board members admitted to enraged local members that they had actually endorsed the payment, but after the fact and only because the local had advised that it was the proper thing to do. After more protests from more irate members, some of the e-board members conceded that they may have been mistaken, and so the board voted for an investigation by an outside attorney whose findings, the Farris report, vindicated the critics of the huge payment to Doser. [At this writing, we do not have a copy of that report but reply upon second-hand information.] The news was circulated to the membership.
Meanwhile, according to our informants, Business Manager Bonilla reported that, because of unpredictable and unfavorable stock market gyrations, the local's pension fund was now unfunded by $700,000. Tough, but stock markets will fluctuate, and you have to take the good with the bad. But the trouble was that, upon investigation, members discovered that the actual unfunded liability was over a million: $1,157,000. And so, members lost confidence in the information they were receiving from their business manager.
When election time rolled around in August this year, Bonilla was challenged by two insurgent slates that highlighted all these facts to the membership. Russ Burns, who headed the opposition Gold Ticket, had been one of the e-board members who pressed for the Farris report. Gold Ticket was publicly endorsed by 107 incumbent and retired representatives at all levels and by 272 rank and file members throughout the four states. When the votes were courted, almost 11,000 members had voted. The Gold Ticket swept every post with 6,550 votes; Red, White, and Blue --- a second opposition slate --- got 2,303; Bonilla's Unity ticket came in a distant third with 2,102.
Now, under the new regime, the local is suing the former business manager, and the lawyer who advised him, to try to get some of the money back.
The success in Local 3 was possible because there were so many members who were not afraid to speak out, which fact makes this an especially interesting story:
IUOE Local 3 was a prime target of the Senate McClellan hearings back in 1957. Its officers had been misappropriating hundreds of thousands of dollars. Under oath, they admitted crass vote fraud in union elections. How account for the transformed atmosphere fifty years later? We can think of one possible explanation: In 1959, two years after those revelations at the McClellan hearings, Congress adopted the Labor-Management Reporting and Disclosure Act which gave some protection for the rights of members in their unions. At AUD, we first established contact with members of Local 3 in 1972 when Norris Casey, running as an insurgent, came close to defeating incumbent business manager Al Clem. Casey not only survived, he remained active, served for a time as a local representative, and is still a local member.
In the years that followed, according to one longtime member, contested elections were frequent and accepted as normal; no fooling around with the ballot count. And so in this huge construction local, where members were free to speak out and to run for office, they were able to resolve charges of financial manipulation against their top officer.
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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