The new is not all good. The restrictions on 25-and-out and 30-and-out pensions before age 57 remain in place. New England Teamsters who did not have enough years of credit by July 31, 2005 will not be eligible for 25- or 30-and-out until age 57. Unlike in the past, the changes did not include grandfathering provisions to protect Teamsters who were close to making their 25 or 30 years and were planning to retire soon. Members are calling for the fund trustees to grandfather existing negotiated promises. Teamsters who were close to qualifying under the old rules should have their contracts honored.
Change #1: No Punishment for Continuing to Work
Under the original changes, Teamsters with 25 years who continued working after July 31 would have their pension frozen until they reach age 57. Then, at 57, the pension would snap back to the full rate. A member who had to retire before 57 because of injury or the closure of their company would get no additional benefit for their extra time worked.
The Trustees have now eliminated this “Snap Back” provision. If, and only if, you had 25 years on July 31 and were eligible for a special service benefit, then you will continue to earn the additional $150 per year and be eligible to retire at any age.
Change #2: Honoring Promises in Existing Contracts
Under the original cuts, Teamsters would have suffered a reduction in their pension accrual if they were covered by contracts that did not include annual increases in their pension contributions of 5 percent. This would have meant pension cuts for many New England Teamsters covered under multi-year contracts that were negotiated before the pension rules were changed.
The Pension Fund Trustees have backed off of this unreasonable rule. Now, the Pension Fund will honor all existing contracts by maintaining the accrual rate. When these contracts expire, the new contracts must include increased pension contributions of 5 percent a year to maintain the accrual rate.
Pension Reform, Accountability Needed
Both of the reforms to the original cuts address problems that were first reported by TDU. It remains to be seen whether membership pressure can convince the Trustees to introduce stronger grandfathering provisions that will protect Teamsters who were planning to retire under the old rules.
Teamster members and officers won these improvements by putting pressure on the Pension Fund Trustees. This is an example of how our union trustees on the pension fund are indirectly accountable if we apply enough heat. What is really needed is direct accountability.
The New England pension cuts show the need for us to elect delegates to the 2006 Teamster Convention who will back reforms to the Teamster Constitution to hold benefit fund trustees directly accountable to Teamster members–and to support candidates for International office who will defend our pensions from attacks by the employers and corporate politicians.
April 25, 2005: While Hoffa prepares to release a report justifying his shutdown of RISE investigations into organized crime, government investigators and the press are pursuing the leads Hoffa claims are a dead end:
- Joint Council 25 President John Coli is under investigation by the FBI based on the leads Hoffa chose not to pursue including allegations of organized crime influence and benefit fund scams in Local 727.
- The Independent Review Board is investigating Local 714, the 10,000-member local long run by the Hogan family. At least ten people have been summoned to testify as part of the investigation.
The Independent Review Board (IRB) has already acted on other investigations shut down by Hoffa. Joseph Bernstein, a Hoffa ally and Joint Council 25 Vice President, has been barred from the Teamsters.
In another breaking story, The Chicago Sun-Times has linked former Local 726 president Daniel Stefanski with organized crime figures including “mob bookie Nick ‘the Stick’ LoCoco” who is suspected of taking bribes from working Teamsters who wanted full-time jobs or overtime opportunities.
Stefanski is also alleged to have offered a $20,000 reward to anyone who could provide the address of a mob informant that the Chicago Outfit wants dead.
The Sun-Times revealed that Hoffa knew of these allegations but chose not to pursue them for “political reasons.” Stefanski is a boyhood friend of the Illinois Governor and is now on the state’s payroll.
The collapse of Project RISE last year was a public relations nightmare for the Hoffa administration. With headlines screaming, “Mob stigma again haunts Teamsters,” Hoffa hand-picked corporate attorney Edward McDonald to issue a report and save his image.
One year later, McDonald will finally issue his long-anticipated whitewash.
Incredibly, McDonald’s report barely explores the organized crime allegations, according to the Sun Times, which got access to a leaked copy from the Hoffa administration. Instead, McDonald’s whitewash focuses on personally attacking Stier.
The IBT may not be interested in Stier’s findings. But the feds and the IRB are. TDU will continue to inform members on these breaking stories.
RISE investigators discovered that several funds are giving business to the notorious Group Administrators (GA), an outfit run by David Dorfman. Dorfman’s father Allen is an organized crime figure who was indicted for bilking the Central States Pension Fund out of millions.
Dorfman and GA were dumped from Local 743 in 1995, when an IBT-appointed trustee caught them soaking the fund with excessive fees. So why are Teamster funds still using Dorfman and Group Associates?
That’s what investigators wanted to know. Incredibly, Dorfman and GA are not only working with Locals 714 and 781, but they’re back at Local 743 too!
Another firm, Leahy and Associates served as broker for at least 10 Teamster-affiliated benefit funds in the Chicago area as of 2002.
The head of Leahy and Associates is under indictment in a RICO lawsuit for operating a racketeering enterprise along with members of the Duff family who are considered by Chicago law enforcement authorities to be linked to organized crime.
TDU has obtained a confidential report that Stier issued to Hoffa. It warned of intelligence reports that Chicago mafia figures were exerting influence in the General President’s office to block investigations into their organized crime interests.
The report charges Hoffa with personally derailing investigations into organized crime influence in multiple Chicago locals.
The General President’s office ordered a shutdown of all investigations into corruption and organized crime in Chicago in February, 2004.
In the report, Stier called on Hoffa to reverse course and enable RISE to investigate organized crime influence in Chicago locals and in the General President’s office itself. Hoffa refused and Stier resigned in April 2004, along with his entire staff of investigators.
At the time of Stier’s resignation, speculation centered on the role played by Hoffa’s-then Executive Assistant Carlow Scalf in blocking investigations into organized crime in the Chicago Teamsters, reportedly at the behest of Chicago mob officials.
But the full text of Stier’s 302-page report reveals that Hoffa himself repeatedly derailed investigations into organized crime and protected officials accused of organized crime ties. Included were Teamster power brokers who backed Hoffa in his rise to the General Presidency.
Hoffa Protects Power BrokersHoffa balked when Project RISE recommended that the IBT launch a formal investigation of Local 714, the home local of Billy Hogan Jr., a key Hoffa ally and former running mate. Hogan was barred for life from the union in 2002 for a scheme to steal Teamster trade show jobs in Las Vegas and give the work to a Chicago-based temp agency with ties to Hogan’s relatives.
RISE investigators received information that despite his ban, Hogan continued to exercise control over Local 714. (The local is headed by Billy Hogan’s son, Robert.) RISE investigators also uncovered apparent ties between Local 714 officials and organized crime figures.
Stier recommended that Hoffa appoint a personal representative to assist with a formal investigation. Hoffa took no action. When pressed by Stier, Hoffa instructed Stier to drop the investigation and turn over the Local 714 issues to the Independent Review Board.
Hoffa also refused to act on recommendations to charge three Local 786 Teamsters, including the assistant administrator of the local’s benefit funds for her association with a barred Teamster and Chicago mob lieutenant. When Stier pushed the issue, Hoffa said the charges were too minor.
Hoffa also removed his personal representative to Local 726 without notifying investigators. They were gathering information about organized crime influence in the local and a “Christmas Bonus” scheme that reportedly extorted members for hundreds of thousands of dollars per year in bribes in exchange for jobs and overtime opportunities.
Crisis PointIn all, investigations into one-third of the locals in the Chicago Joint Council were disrupted by Hoffa and his executive assistant, including an examination of the home local of Chicago Joint Council 25 President John Coli and two other joint council officers.
Hoffa also blocked the investigation into numerous reports that an International Organizer has been an organized crime associate.
The situation reached a crisis point when the General President’s office pulled the plug on all investigations into Chicago locals in February 2004.
Stier submitted a report to Hoffa a short time thereafter, detailing the organized crime allegations that needed to be investigated. The report goes out of its way not to prejudge the targets of the investigations. The issue, Stier wrote, was “whether political forces opposed to genuine anti-racketeering reforms will prevent them from being investigated at all.”
Stier warned, “If the current shutdown of IBT anti-racketeering efforts is allowed to stand, the reason for it will be obvious to both Teamsters and outsiders: the continued influence of the Chicago Outfit [organized crime] and the culture of corruption that has flourished in that area for as long as the union has.”
Rank and File WatchdogUntil now, the only Teamsters with access to Stier’s confidential report were Hoffa and the General Executive Board.
TDU obtained the report and is making this information available to the members because the allegations of widespread organized crime influence stretching from Chicago to the General President’s office have to be dealt with decisively and not swept under the rug.
The truth is that the International Union is millions of dollars in the red. Don’t take our word for it. This data comes from the IBT’s own audited reports and financial reports filed with the U.S. Department of Labor. These reports are signed by Hoffa and Keegel.
International Union Net Assets Are Below Zero
The IBT’s LM-2 financial report revealed net assets of minus $8.5 million. That’s right, the IBT has a negative balance sheet.
So why do Hoffa-Keegel claim in the February 2005 Teamster magazine that the IBT has net assets of $148 million? Are they lying to the Department of Labor—or are they lying to the rank and file?
Hoffa even brags on page 16 that “we have the largest net assets in the labor movement.” When Hoffa claims the “highest net assets” of any union, he must mean highest negative assets! By way of comparison the United Auto Workers has net assets of $1.128 billion. And the UAW is half the size of the Teamsters.
Two terms of Hoffa-Keegel and our net assets have dropped by more than $10 million. They have taken us into the red.
In July 2002 we had the largest dues hike in the history of the Teamsters, enacted by the Hoffa “No Dues Increase” slate. Dues went from 2 hours pay to 2.5 hours pay for Teamster members. The bulk of this new money went to the IBT, not local unions. The International Union’s income nearly doubled.
How Could their Big Dues Hike Lead to Deficit?
Ten percent of the IBT budget goes to organizing and fifteen percent to our strike fund. The rest is for the unrestricted use of the leadership. With IBT income up 79%, salaries and appointments have ballooned.
The IBT also has obligations for special officials-only pensions and retirement health plans, that have put the union into debt. According the IBT’s own LM-2 report, the IBT owes unfunded obligations of $55 million in retiree health benefits for IBT employees and also for IBT officials and appointees.
This is a special health plan, not available to working Teamsters. It provides 100 percent coverage for life, for retirees and their families.
No premiums to pay, ever.
No Cuts for Hoffa Appointees
Does that sound better than your health plan? What happened when health costs went up for your retiree coverage? For Central States Teamsters, retiree coverage for a Teamster and spouse has gone from costing $50 per month to an average of over $1000, under Hoffa’s leadership.
Central States Union Chair, Fred Gegare, says that is necessary due a “perfect storm.” But notice that Gegare has free health care for life for his family.
The IBT could lower that obligation, and get our union out of debt, by instituting cost savings and having Gegare and other retired officials pay some co-pays or premiums for their health care. But they won’t do that.
There is an additional $59 million deficiency owed to the pension plan for employees, appointees and officials of the IBT. Do you think they will cut pension accruals in half for highly paid officials? That would help our balance sheet. Central States cut your pension accrual in half.
Will Gegare cut his own?
Old Lies Smell Bad
Once again in the February Teamster magazine they continue to blame the previous leadership of Ron Carey for their own greed and mistakes. Carey left the union in late 1997, nearly eight years ago. At that time, our union had better net assets than it does now, by more than $10 million. Even after all liabilities were accounted for, our union was in the black.
Isn’t it time for Hoffa and Keegel to quit playing the blame game and take responsibility for their own mismanagement?
Hoffa and Keegel recently signed checks for 34 consecutive months to Executive Assistant Carlow Scalf, money that Scalf was embezzling from the IBT. No wonder we are in the red.
The IBT will eventually get out of the red, with that 79 percent increase in income pouring in over $140 million a year. But the money is not being used to build Teamster power as we were promised.
No Teamster should resent paying dues: our union needs money to take on corporate greed. But we have a right to expect our money to be used to build union power, not pork. And, we deserve the truth—not spin or lies—from the officials who manage hundreds of millions of our dues dollars.
February 5, 2005: The contracts that cover about 8,000 Teamster drivers, warehouse workers and office clerks in the Southern California grocery industry are set to expire Sept. 15, 2005.
Coming on the heels of last year’s grueling four-and-a-half month strike and lockout of the UFCW store clerks, these negotiations are sure to be some of the toughest and most demanding in recent history.
Are the employers in a position to take us on like they did the clerks? Is the Teamster leadership prepared to battle the company if necessary? These, and many others, are the questions that rank and filers are asking.
“We will never know exactly what the companies are going to do, and sometimes it is difficult for us to be certain what our Teamster leadership will do. But one thing is for sure: the rank and file grocery industry Teamsters had better be prepared for whatever possibilities we may face,” says Chuck Robinson, a driver for Albertsons.
A New Era
These negotiations mark the end of one era and the beginning of a new one. The long-time union negotiating chair, Jerry Vercruse, passed away last year and the new chair is IBT Vice President Jim Santangelo, who is also the head of Joint Council 42.
Santangelo did an abysmal job during the UFCW strike, so rank and file Teamsters had better be prepared if we want these negotiations to be a success.
I recently contacted the California State Attorney General’s office and obtained a copy of the “Mutual Strike Assistance Agreement” that Ralphs (Kroger), Albertsons, and Vons (Safeway) entered into prior to those negotiations.
Mutual strike assistance? I thought these employers were supposed to be competitors! When it comes to taking on organized labor, these employers are allies and they are united.
Teamster Unity Needed
As Teamsters we need to send the employers a signal that we are just as prepared and united. Management needs to get that message from our leaders—but that’s not enough. The employers need to see the same determination from the ranks. They need to see us getting informed, involved and prepared to take action if necessary to defend our contract and our benefits.
Our union needs a coordinated campaign—with regular contract campaign updates, stickers, petitions, t-shirts, rallies and action days. We need to build a member-to-member communication and mobilization structure to maximize Teamster participation in these activities.
The best way for us to avoid a strike is for the companies to see that we are prepared for one. They need see that members are capable of quickly spreading information and taking rapid action. We can demonstrate that ability by building a strong, effective contract campaign starting now—not waiting until negotiations hit a crisis point.
We also need to make a break with the traditional dinosaur methods of contract negotiations. Rank and filers need to be a part of the negotiating committee, not just officials and business agents.
Rank and file members are the ones most affected by the contract and we deserve a seat at the bargaining table. We should be part of formulating the proposals that are presented to management.
When an offer is ready to be voted on we need to demand that we have an informed vote.
We need ample time to thoroughly review the proposals, and we need everything available in writing. No reading from the podium or side agreements popping up after the vote.
Power of the Rank and File
Teamsters in the grocery industry need to realize the power we possess and the positive gains that we can achieve if we exercise that power effectively. The power of the rank and file is the key to obtaining a quality contract.
It’s our future. Let’s fight for it!
Frank Halstead, Shop Steward
Local 572, Ralphs Grocery Co.
February 17, 2005: Boston Local 25 President Ritchie Reardon told Joint Council 10 that the IBT Parcel Division approved a mid-contract giveback to UPS that violates language in the New England supplement. Reardon’s statement was part of his testimony in a hearing on internal union charges over the concession. The testimony marks the first time that anyone has put on the record that the IBT approved the contract concession. Reardon said the approval was not issued in writing.
Sunday to Thursday Without Premium Pay
Local 25 negotiated a side agreement with UPS management, after the company threatened to move some jobs, that allowed the company to establish a Sunday to Thursday workweek with no premium pay for Sundays. The New England supplement recognizes only a Monday to Friday or a Tuesday to Saturday workweek. The UPS contract requires that all mid-contract agreements be approved by the Joint National Negotiating Committee.
The giveback quickly spread to locals 42, 191, 340 and 671.
Other local unions voted the giveback down or refused to hold a vote—even though UPS threatened some locals that they would lose work if they did so.
Members have argued that the change to the regional supplement should have been put to a regional vote—rather than allowing UPS to pit local against local for the best deal.
The impact of this giveback continues to be felt. Recently UPS management at the Worcester hub posted a notice stating that the a.m. sort would be shut down and that the volume would be “moved to other hubs.” Worcester Local 170 was one of the locals that resisted the side agreement.
If the IBT and all New England locals had stayed united it would be impossible for management to pit members against each other in this manner.
A lawsuit filed by members to reverse the concession was dismissed on a technicality Jan. 13. The judge hearing the case ruled that the suit needed to be filed within six months of the change at Local 25, rather than within six months of the date that Local 25 refused to process members’ grievance against the change.
According to Local 25 member David Whitney, the New England Supplement Protection Committee will continue pursuing the issue through charges that are under investigation at the National Labor Relations Board. Also, internal union charges have been filed against officials of all the local unions that made the change without a proper vote of the members
Teamsters have been petitioning across North America to make the Leedham slate the officially accredited team to put forward new leadership for the Teamsters Union. It will also give all Teamsters the right to hear from the candidates in the Teamster Magazine. (The Leedham campaign asks that all Petitions be received by December 9, at Leedham Campaign, 320 7th Ave #338, Brooklyn, NY 11215. See www.leedham2006.org for further info.)
Next StepsThe Campaign is producing a DVD of Tom Leedham’s speech to the TDU Convention. Running approximately 20 minutes, Tom’s speech covers his background as a working Teamster and addresses many of the key issues in the upcoming campaign. This can be used to introduce Tom to fellow Teamsters. Copies will soon be available from the campaign. Order your copy at info [at] leedham2006.org or by mail; include a donation for the DVD.
The Leedham campaign and reform Teamsters are looking ahead to the next steps in the campaign, including:
• Convention Delegate Races: Almost all local unions will hold delegate elections, with nominations in January in most, February in some. We need to elect delegates who will nominate the Tom Leedham Strong Contracts, Good Pensions Slate and support reform proposals at the Convention. The time is now for plans to run and win. Need ideas or help? Contact the campaign at leedhamslate [at] gmail.com.
• Outreach:To win in 2006, we need a strong, well-coordinated grassroots network of Teamster volunteers. The Leedham Campaign needs your help in building a database of supporters. Please mail or email to the campaign the names and contact information you have (phone #s, email addresses, and/or addresses) for Teamsters who will support the campaign.
• Fundraising: It’s simple. To win in 2006, the Leedham Campaign needs to raise serious money. The campaign is now able to take credit card donations online at www.leedham2006.org. We encourage all supporters to donate today.
Georgia has a long tradition in the history of Teamster reform. Teamsters here have also been deeply involved in the effort to stop pension and health benefit cuts.
While continuing to move ahead with positive changes, members in both locals may now also face what is becoming a worn-out routine under the Hoffa administration: re-run elections. The losing slates in both locals have filed protests.
Local 528 members will also be demanding that the International end its trusteeship of the local, imposed over 20 months ago, and install their duly elected officers as quickly as possible.
January 28, 2005: New York Local 805 members elected the Sandy Pope Leadership Action Team in balloting on Dec. 7. Pope, a long-time leader in the Teamster reform movement and a member of the TDU International Steering Committee, defeated the incumbent president by a wide margin. All seven members of her slate were elected.
Cuts to the Local 805 pension were a major issue in the campaign. Pope opposed them and said the union should launch a campaign to preserve benefits. Incumbent President Gerry Whelan said that stock market losses in 2001 and 2002 made pension cuts inevitable even though the Local 805 pension fund is 90% funded—making it much stronger than other funds that have cut benefits.
Members backed Pope by a 58% to 42% margin with 55% of the local’s 1,200 members voting. But Whelan was not about to let the voice of the members get in the way of his plan to cut members’ pension.
In an 11th-hour move before leaving office, Whelan struck a deal with employers to cut the pension accrual rate to zero—meaning that members will earn no pension credit beginning in 2005. At the same fund meeting, employer trustees and an alternate designated by Whelan’s defeated executive board voted to hire Whelan as the fund manager.
As we go to press, the new Local 805 executive board is making plans for a campaign to defeat the pension cuts and job grab pushed through by Whelan and the employers—including possible litigation.
“Gerry took care of himself and hung the members out to dry,” said Ralph Vomaro, the newly elected secretary-treasurer on the Leadership Action Slate. “We’re not going to let him or the employers undermine our benefits.”
Pope and the Leadership Action Team have a track record of defeating employer demands for benefit cuts. In the last round of negotiations, multiple Local 805 employers demanded that members start paying for a portion of their medical benefits.
Instead, Pope, with the backing of strong rank and file negotiating committees, bargained record contribution increases that preserved members’ medical benefits without cuts or cost-sharing on the monthly premium.
“Local 805 members elected the Leadership Action Team to strengthen union representation and fight to protect our benefits—and that’s what we’re going to do,” Pope said.