December 5, 2006:All local and International officials from the Western Region have been invited by International Vice President Jim Santangelo to spend a week at Waikiki Beach in Honolulu in late February. Then, officials with local pension funds can stay an extra week in early March at a pension trustee educational. Some local officials have pointed out to Santangelo their embarrassment at having to face questions from members about these union-paid trips to tropical resorts. He has refused to budge. Also, some local officers want to attend the pension trustee conference, but find the Hawaii trip expensive and time-consuming.
The party is back on in the Central Region, too. The 2007 UPS grievance panels for the Central Region will be held at resorts in Florida and Las Vegas. Since the members and stewards who need to attend are in the Midwest, these seem to be planned more around golf outings than representation. In July they will hold one panel in the region: next to a golf resort in Traverse City, Mich.
Are the finances of the International Union in order? Is there a balanced budget? Is more money going into organizing or into multiple salaries?
TDU, with the aid of financial experts, has reviewed a number of documents including the “Officers’ Report” produced for theIBT Convention, LM-2 financial reports on file with the Department of Labor, and audited financial statements of the International Union.
This research has shown that James Hoffa is playing politics with the members’ money, and trying to cover it with certain myths.
Teamster members deserve the facts, not propaganda. Only TDU, as an independent watchdog organization, consistently reports such facts, like our annual $100,000 Club (watch for our next issue!), no matter who is in office.
Here are the facts on the finances of our International Union. If you have questions or comments, contact TDU today. This is about your Teamsters Union.
Myth #1: Hoffa "Blanced the Books and Got the Finances in Order"
Hoffa has not balanced the books. The International Union is running a deficit every month.
The Hoffa administration in 1999 and 2000 spent $16.7 million more than they took in during that 21-month period.. In 1998, the year prior to Hoffa taking office, the union ran a surplus.
The Hoffa administration has covered up the deficit by using two accounting gimmicks, both involving their officials-only pension plan.
They took a negative expense (a credit on the books) of $18.4 million from the Teamster Affiliates Pension Fund, a windfall accounting move that is possible because the Carey administration froze this officials-only pension plan in 1994. This did not put any money in the treasury, but moved it around on paper, and cannot be repeated next year.
They also siphoned $6.4 million out of the Affiliates Plan and the Family Plan, claiming back rent for the past five years -- another one-time windfall that has to do with events before they came into office.
These accounting gimmicks with pension money may help cover-up this year, but the fact is that the Hoffa administration is spending more than it is taking in, by about $800,000 per month.
In fact, if the International Union would release to the membership its six-month audit for the first half of 2001, the facts would show a large deficit on operations. Perhaps that’s why they have refused members’ written requests for the information.
The Bottom Line
The Hoffa administration has used accounting windfalls involving an officials-only pension plan so they could claim that they balanced the books in an election year. They are taking credit for what was done during the Carey administration.
Just as bad -- or worse -- the Hoffa administration has shifted priorities away from members and toward perks for officials.
They have increased payments for multiple salaries by 478 percent. This includes the 115 Hoffa appointees who get multiple salaries. More millions would be saved if Hoffa and his elected running mates would live up to their pledge to cut and cap their own multiple salaries.
They have increased payments for officials pensions and benefits by 18 percent.
They have increased payments for PR by 49 percent, money that goes to high priced consultants like Richard Leebove, who was caught making an illegal $167,000 employer contribution to Hoffa’s 1996 campaign.
This fattening up is paid for by cutting strike benefits and organizing. As a result our union has shrunk by 11,000 members since Hoffa took office, dipping below 1.4 million for the first time in decades. Teamster power is eroding, while top Teamster officials are fattening.
Myth #2: The Biggest Expense We Have in the IBT Budget is "Government Oversight"
The truth is that less than one cent of every members dues dollar goes to cover the cost of rooting out corruption by the Independent Review Board (IRB), far less than is paid for multiple salaries and pensions for officials.
The total cost of the IRB over the past nine years has not been $100 million, as Hoffa propaganda continually claims. A review of union financial records reveals it has been $30 million, or about $3 million per year .
On page 44 of the Officers Report distributed at the Teamster Convention we find that the total cost of government in the past 12 years is $79 million, but this includes:
- $10.7 million in legal fees spent defending Hoffa’s pals such as Weldon Mathis (whose son is Hoffa’s political director), Walter Shea, Bobby Holmes and other Hoffa allies. This was spent from 1987 to 1991.
- $12.2 million in other costs associated with the racketeering lawsuit and consent decree during that 1987 to 1991 period.
- $22 million to cover the costs of our delegate and IBT officer elections in 1991, 1996 and 1998.
The Hoffa administration is lying about the cost of the IRB to scare members, to try to get rid of any effective oversight that might remove corrupt officials in Hoffas administration. His Special Assistant Dane Passo, his former running mate Billy Hogan, and his life-long associate Mike Bane have all been either charged or convicted by the IRB in the past two months. Those are facts.
All Teamsters share the goal of cleaning up our own house, without the need for the IRB, but Hoffa has done zero to make this possible.
Hoffa claimed he would make the IRB unnecessary when he launched his RISE program which was supposed to root out corruption. But RISE has accomplished nothing, after two years and millions of dues dollars, except holding press conferences for Hoffa. (See story.)
At the recent IBT Convention, the lies about union finances under Ron Carey’s term reached monumental proportions. Each Hoffa official seemed to try to top the last one in lying.
Myth #3: "Ron Carey Drained the Treasury"
From 1991 to 1996, during Carey’s tenure, IBT assets did decline. But this was because of an increase in strike benefits adopted at the June, 1991 IBT Convention to $200 with no funding mechanism. As a result, the strike fund was depleted over the next three years, while Hoffa and supporters blocked any meeting of minds to try to deal with the problem.
At that 1991 convention, 85 percent of the delegates were old guard supporters, in most cases the same ones now backing Hoffa.
The IBT lost $39 million in net assets in 1991 alone, before Ron Carey ever took office in 1992, largely because of the strike benefits.
Assets, mostly in the strike fund, were $154 million when Carey took office in 1992, and when Hoffa took office they were only $8.6 million, a decline of some $145 million. But two items account for over 99 percent of that decline.
First, during that period the IBT paid $126 million in strike benefits. And second, the IBT recorded $18 million of expenses for the Teamster Affiliates Pension Plan which the old guard had set up to provide an extra pension for officials, and which the Carey administration froze in 1994.
Excluding those two items, the assets declined by only $1 million in that seven-year period, despite the IBT paying for election costs, the 1996 convention, and the cost of the IRB.
The Bottom Line
The Teamsters Union was never bankrupt, but its strike fund was depleted because benefits were increased in 1991 with no funding mechanism.
When Hoffa ran for office in 1996, he promised to quadruple strike benefits with no dues increase, but instead has cut money being paid to strike benefits, frozen at $55 per week, and put the fat on his own salary, multiple salaries and increased perks for his appointees, and PR for himself.
The Hoffa administration has not balanced the budget, but is running a deficit on operations of $800,000 a month or $10 million a year. Accounting gimmicks may appear to balance the books, but the truth will be evident as soon as the Hoffa administration is forced to reveal the results of the audits for this year.
What has changed under the Hoffa administration are the priorities: organizing and strike benefits are cut, and multiple salaries, perks and PR costs are increased.
Bloated salaries, perks and PR will not restore Teamster power. Nor will election-year myths and cover-ups.
The IBT Election Supervisor and the Appeals Master ruled decisively that Gegare transferred these Teamsters, without even consulting them, to five other locals in retaliation against their local president for his participation in the Tom Leedham Strong Contracts, Good Pensions Slate.
Local 549 President T. C. Bundrant, who is running for International Vice President on the Leedham slate, stated “This is a win for these dairy workers, who deserve good Teamster representation. Politics should have no part in representing our members. This kind of attack on locals has to end, and it’s one reason I’m running for International office.”
Appeals Master Judge Kenneth Conboy noted the “bogus nature of the three purported non-retaliatory reasons given for the raid on Bundrant’s membership” in ruling that the members be promptly returned to their home local union, based in Kingsport, Tenn.
December 5, 2006: Tom Leedham’s campaign for Teamster General President did more than win 35 percent of the vote. It strengthened our union for the future.
Since the 1997 UPS strike, employers have been on the offensive against our union. We have lost 150,000 members. Overnite defeated our organizing drive, paving the way for UPS to purchase it and operate it nonunion. And hundreds of thousands of Teamsters have suffered the first big pension and benefits cuts in Teamster history.
Hoffa tried to silence any debate of these problems by keeping all opposition off the ballot. TDU protected our Right to Vote and gave members a choice.
Tom Leedham’s campaign put pension and benefit cuts, contracts and organizing in the spotlight and outlined an action plan for rebuilding Teamster power.
Leedham’s message resonated with Teamsters across North America. He received his strongest support from Teamsters who are covered by national contracts negotiated by Hoffa and members whose pension or health benefits were cut by Hoffa’s trustees.
He won numerous freight and UPS locals, the strategic industries that are the foundation of Teamster power, including Chicago Local 705, Detroit Local 243, New York Local 804, St. Louis locals 604 and 688 and numerous others.
The Teamsters who know Tom Leedham best, the members of Oregon Local 206, supported him by a whopping 93 percent margin. Hoffa carried his own home Local 614 by just 26 votes.
Time for Hoffa to Drop Attacks and Reach Out to Rank and File
During the campaign, Hoffa attacked Teamsters who disagree with him as union busters. Leedham won dozens of locals, several major urban areas (including Cincinnati, Columbus, Cleveland, and St. Louis) and several states. Are all 100,000 Teamsters who voted for Leedham really friends of the employers?
Hoffa won’t solve our union’s problems by attacking every Teamster who disagrees with him. The low voter turnout in this election shows that members are tired of negative attacks and PR.
It’s time for Hoffa to drop the attacks and accept that our union is a democracy where members have different opinions and ideas. That’s a good thing. Debate draws members into our union and that’s where union power starts.
Instead of attacking members who disagree with him, Hoffa should reach out to all Teamsters and build campaigns that unite all Teamsters. That’s how we’ll win strong contracts, good benefits, and organize the nonunion competition.
Hoffa’s Weak Contracts Can’t Hide Behind His Father’s Famous Name
July 2006. The 2006 IBT election will be a rematch between Hoffa and Tom Leedham, who squared off in 2001. While the names at the top of the ballot are the same as in 2001, the similarities end there.
In 2001, Hoffa was an incumbent without a record. In three years in office, he had never negotiated a UPS or freight contract. In the few bargaining units where Hoffa had negotiated a contract, the members voted against him. But for the most part Hoffa could still run on his father’s celebrity.
This year, Hoffa has to run on his record and it’s not pretty. His “Best Contract Ever” is so weak that he’s back at the bargaining table to try to fix it two years before it expires. Hundreds of thousands of Teamsters have been hit with pension and health care cuts after Hoffa guaranteed his contracts would maintain or increase our benefits.
Tom Leedham has a proven record in exactly the areas where Hoffa has failed.
Winning Strong Contracts
Leedham has negotiated industry-leading contracts as the head of Oregon Local 206 for 20 years, where he represents warehouse, UPS, freight, sanitation, public employees and other Teamsters.
Leedham has eliminated Local 206’s multi-tier contracts that paid different wages and benefits to Teamsters doing the same work. Leedham’s contracts brought all members up to the top scale.
Restoring Good Benefits
When Leedham took office, the Local 206 health trust was nearly bankrupt. Retiree healthcare coverage was being eliminated.
Leedham instituted reforms and won higher employer contributions. He turned that fund around and reversed the benefit cuts.
Today, Local 206 members enjoy a top-notch health benefit with no or low co-pays. Leedham has restored affordable health benefits for retirees.
The Hoffa Legacy
Hoffa’s record dues hike doubled the budget of the International Union. Did Hoffa double our union’s power? Did he double the backing Teamsters get from our IBT? Or did he just double the PR we get in our homes?
Hoffa won the last election on his father’s famous last name. This year, he’ll have to answer for his own infamous record.
Weaknesses in UPS Contract Force Hoffa to Ask Management for Another Bite at the Apple
July 2006. It’s official: Hoffa’s “Best Contract Ever” has failed; the union will now sit down to try to negotiate early with UPS management.
Management seems happy to bargain early, hoping to button up a deal long before any threat of a work stoppage, and before the big 100 year anniversary events. Management is telling the media that they are eager to put forward their demand to pull out of Teamster pension plans.
The timing of the early negotiations seems geared not so much towards securing the best possible contract, but the best possible election PR for Hoffa. The announcement came at the Teamster Convention, with the fantastic claim that management came to the bargaining table because Teamster officials were massed at the Paris Casino in Las Vegas.
We can expect that more such announcements, rallies and PR will be timed to the coming campaign period, leading up to the Teamster election in October. Our contract is being used by Hoffa for political purposes.
Hoffa has never carried the vote of UPS Teamsters, and now he is worried they will turn him out.
Hoffa’s Incompetence Likely to Cost UPS Votes
Hoffa is good at PR. In the 2002 contract we saw him guarantee pension improvements, health care improvements, guaranteed staffing levels to reduce unwanted overtime, and more. He imposed a dues increase and promised it would deliver Teamster Power. It sounded good.
He settled early and settled short, then put his PR machine to work. But six months into the contract, benefits were cut and promises abandoned.
Hoffa is not good at finishing the job. In 2002 he was in an ideal position, coming off the 1997 strike victory, and blew it. Now he’s going to management, admitting his contract failed, while management is pushing to crush our pension plans.
Tom Leedham knows how to finish the job. He knows how to mobilize members and local officers and put a united team in place to win. And he isn’t controlled by consultants, PR men, and handlers. He’s a Teamster for Teamsters.
In 2001 Tom Leedham defeated Hoffa among UPS Teamsters. He won among UPSers in Los Angeles, San Francisco, Seattle, Portland, Detroit, Chicago, Milwaukee, Minneapolis, Cleveland, Louisville, New York, New Jersey, Atlanta, Memphis, and most other places.
And that was before UPS Teamsters experienced Hoffa’s record of broken promises and benefit cuts.
UPS Teamsters need to get involved. First, in the contract. Our future is more important than politics. Get informed and get involved. Second, get involved in the Teamster election. Get every UPS Teamster to vote. Talk to them about the issues, the candidates and how we can turn our union around this year.
Critical UPS Freight Battle Looms
“This agreement between the Teamsters and UPS Freight is a letter for card check and neutrality at Overnite.”
James P. Hoffa, June 27, 2006
IBT Convention, Las Vegas
With those words, Hoffa promised Teamsters that he won an agreement to let our union organize Overnite (now UPS Freight) without the union-busting tactics we’ve seen from management in the past.
Will Hoffa’s agreement really deliver this promise? We hope so. Organizing UPS Freight is an issue that rises above politics. It’s critical to our union’s future at freight and UPS—and to the future of our pensions and benefits too.
We hope Hoffa’s deal gives us the ability to organize. But we have questions, too.
Agreement Still Secret
When it comes to agreements, the devil is in the details. And we’ve learned the hard way that what Hoffa promises and what he delivers aren’t necessarily the same thing. In 2002 and 2003, Hoffa guaranteed that his agreements at UPS, freight and carhaul would protect our pensions and benefits for six years. We know how that turned out.
So far, Hoffa has not shared the agreement, even with Teamster leaders. But serious questions are being raised since the BNA Daily Labor Report revealed that the agreement is limited to just one UPS Freight terminal out of hundreds.
Hoffa failed to mention this detail at the Teamster Convention. So did the IBT’s press release and Hoffa’s letter to local leaders after the convention.
Under a normal “card check” agreement, an employer agrees to voluntarily recognize the union if a majority of its employees sign a union card. This eliminates the need for an NLRB-run union election. In the past Overnite has used illegal tactics to bust Teamster organizing drives during the NLRB process.
“Neutrality” means that management agrees not to oppose unionization efforts and to let workers decide for themselves.
Hoffa’s card check and neutrality agreement applies to just one UPS Freight facility of the IBT’s choosing. After that, the IBT will have to go terminal by terminal. At this point, there is no agreement from the company to extend card check and neutrality to any other location.
From Card Check to Union Contract
What does this mean for our goal of organizing all 15,000 UPS Freight employees under the National Master Freight or UPS contract and into our pension plans? That’s not clear.
The IBT’s plan is to choose one facility and organize it. The next step, according to Ken Hall, will be to win a contract at that one facility.
What is the IBT’s plan for winning a strong contract at one UPS Freight terminal when the vast majority of the company remains unorganized? So far the IBT is not saying.
On July 1, 2005, Hoffa first announced he would unveil a “comprehensive plan to organize UPS Freight.” More than one year later, local leaders and members are still in the dark about what the plan is to win.
Organizing this long-time union-buster is critical. So is bringing it under a strong master contract and into our Teamster pension and benefit plans.
It will take the unity and involvement of the Teamster membership. All Teamsters should be ready to help.
It’s time for Hoffa to level with the members about the plan for organizing UPS Freight. Concerned Teamsters jumped at the opportunity to take on Overnite before—and we’ll do it again given the chance.