Union Leadership Evaded Pay Cuts as Pandemic Devastated Membership
A California hospitality union spent hundreds of thousands of dollars on political campaigns and executive salaries as the coronavirus crisis ravaged its membership.
UNITE HERE Local 11, which represents more than 32,000 hospitality workers in California and Arizona, saw upward of 95 percent of its membership laid off at the peak of the coronavirus crisis. By the end of 2020, membership had declined by nearly 40 percent. Still, executives barely saw their salaries decrease in the face of the membership's struggles, with the top three leaders taking pay cuts of around 1 percent. The union also continued to spend on political initiatives, pumping more than $431,000 into the 2019-2020 cycle.
Additionally, as California ordered lockdown measures to combat the spread of COVID-19, the union sent members to Georgia to canvass for Democratic Senate candidates prior to the January runoff elections in defiance of the state's orders. The union campaigned with the voter-registration nonprofit group New Georgia Project, founded by Stacey Abrams.
A temporarily out-of-work member of the union expressed frustration with the union's priorities. The member told the Washington Free Beacon that the union was unresponsive to concerns about health benefits and was difficult to contact. He said that setting up meetings with union officials was nearly impossible.
"Some members, they do wonder what the union is doing with the dues. … I don't think [union leaders] actually care about the members," the member said. "They care about their pockets, that's all they care about."
UNITE HERE Local 11 did not respond to a request for comment on the report or on the member's criticisms of the union.
The report also comes after the union became embroiled in controversy for demanding its members pay dues amid layoffs from the coronavirus. According to members, the union said continued access to its health insurance benefits was contingent on paying membership dues. The maximum dues owed by members also increased from $66 to $76 between 2019 and 2020, according to filings.
The demand for dues prompted a letter from lawmakers calling on the union to stop collecting payments. "We are concerned that the continuing collection of union dues from unemployed workers is imposing an additional and unnecessary hardship on these workers and their families—making it even more difficult for struggling Americans to make ends meet," the lawmakers wrote.
The member said union leaders throttle any internal criticism of the union's activism.
"If the union says something that's not appropriate, even if we complain about it, there's nothing to be done about it," the member said. "It's like a giant parasite."
Report: Unions, Dems to Rake in Billions From PRO Act
Unions could spend $3 billion on politics every election cycle
President Joe Biden and Democratic groups could see a surge in donations if they are able to pass landmark labor reforms that would force workers to pay union dues, according to a report.
The White House has made the PRO Act a centerpiece of its agenda in the opening days of the Biden administration. Biden has committed to being the "most pro-union president," but labor groups are not the only ones who will benefit from the elimination of right-to-work laws and collective bargaining reforms. Democratic candidates and liberal groups could see political and lobbying spending "increase to nearly $3 billion per two-year cycle," according to a report from the Institute for the American Worker.
"If you are a progressive then you will think that this is the greatest thing ever as it will drive resources to achieving your objectives," report author Nathan Mehrens said. "If you are a conservative, you should be concerned for the same reason."
The act would overturn right-to-work laws in 27 states and force local workers to join unions as a condition of employment. The injection of mandatory dues would provide an overnight boost to the coffers of labor unions that have hemorrhaged members in the past three decades. Unions could see annual payments from workers nearly double under the PRO Act, according to the report.
"Unions that are under the jurisdiction of the U.S. Department of Labor already receive over $11 billion per year in dues and fees," the report states. "If labor organizations can increase their membership to the level that existed in 1983, the dues they receive could, under a conservative estimate, exceed $20 billion."
The influx of new dues money could also expand the political and campaign influence of organized labor, which has been one of the Democratic Party's most reliable allies. Unions were major financial backers of Biden's presidential run. They spent an estimated $27.5 million backing the Biden campaign and nearly $250 million supporting Democratic candidates overall.
The PRO Act would also provide a massive membership boost to labor unions, which are currently experiencing low membership numbers. A little more than 14 million private and public sector employees belong to unions, according to the Bureau of Labor Statistics. Biden, who has repeatedly called on Congress to pass the plan and whose administration considers the act part of its infrastructure program, said that 60 million Americans will join a labor union "if they get a chance."
First Amendment rights could be implicated by mandatory dues imposed by the act. Mehrens raised concerns over the act's forcing workers to "financially support unions regardless of whether they agree with the positions taken by these unions."
"No one should be compelled as a condition of employment to support a third party with which they do not agree," he said.
The Democratic-controlled House of Representatives passed the act in early March, and the White House has repeatedly urged the Senate to pass the legislation. Sen. Joe Manchin (D., W. Va.) has announced his support for the act, but three other moderate Democratic senators—Kyrsten Sinema (Ariz.), Mark Kelly (Ariz.), and Mark Warner (Va.)—have yet to back it. Even if Senate Democrats were unified, the bill is highly unlikely to garner enough Republican support to bypass the filibuster.
In his address to Congress, Biden called for the passage of the act alongside an increased federal minimum wage. "The guys and women on Wall Street, Wall Street didn't build this country. The middle class built this country. And unions build the middle class," he said. "And that's why I'm calling on Congress to pass the Protect the Right to Organize Act, the PRO Act, and send it to my desk to support the right to unionize."
Exclusive: GOP Rep Calls for CDC Director To Resign Over Union Collusion
Rep. Greg Murphy (R., N.C.) called on Centers for Disease Control director Rochelle Walensky to resign Tuesday after reports surfaced that one of America’s largest teachers’ unions influenced the center’s school reopening guidelines.
"As a practicing physician, I believe that any physician who puts the influence of political organizations before the well-being of our children has violated the Hippocratic Oath and does not belong in public service," Murphy said in an exclusive statement to the Washington Free Beacon. "These actions are unconscionable, and so I am calling on Dr. Walensky to resign immediately."
The CDC edited its guidance for reopening schools in response to pressure from the American Federation of Teachers, emails between top officials at the CDC, the union, and the White House show. The union offered "suggestions" to the CDC’s plan that were added "nearly verbatim" into the center’s Feb. 12 school reopening playbook, the New York Post reported.
Teachers' unions across the United States rallied to keep schools closed during the pandemic, ignoring a body of scientific evidence that said it’s safe to teach students face-to-face. Unions demanded teachers be prioritized during vaccine distribution before returning to the classroom, but scientists—including Walensky—said such measures were not necessary to safely reopen schools.
The CDC was prepared to recommend schools reopen before the American Federation of Teachers stepped in. Kelly Trautner, the American Federation of Teachers' senior director for health issues, said the union reviewed a draft of the CDC’s reopening guidance and gave some "feedback" on how to improve the plan. That email was forwarded to Walensky by White House coronavirus testing coordinator Carole Johnson, according to the Post.
Trautner suggested an "update" of CDC guidelines could be necessary for schools in communities with higher rates of coronavirus cases. The American Federation of Teachers also demanded school staff with higher risks of contracting the virus receive special allowances to work from home. Both measures were included in the final draft of the CDC’s guidance.
Murphy, a doctor and member of the House Education and Labor Committee, told the Free Beacon that scientists, especially the CDC’s experts, should not bow to pressure from political influences.
"The CDC is supposed to be occupied by scientists who do not bow to political influence," Murphy said. "This obviously is not the case under Dr. Walensky’s leadership. As one of the most important public health officials in America, she should have had the fortitude to reject AFT’s influence in the CDC’s recommendations
Federal prosecutors recommend two-year sentence for former UAW President Dennis Williams for fraud and corruption
Federal prosecutors are requesting a 24-month sentence for the disgraced ex-president of the United Auto Workers, Dennis Williams, for his use of hundreds of thousands of dollars in corporate cash and workers' dues money to finance lavish getaways for himself and his fellow union bureaucrats, court filings revealed on Monday.
Williams is one of 14 UAW officials and corporate executives to have been charged in a years-long federal corruption probe. Williams pleaded guilty last October to federal charges, which would have carried a maximum sentence of five years. However, the terms of his plea deal capped his sentence at two years.
The charges against Williams, as with his successor, former UAW International President Gary Jones, stem from his role in the use of the UAW Region 5 annual conferences as an occasion for lavish, weeks-long “all-expenses-paid vacation[s]” in Palm Springs, as the sentencing memorandum describes it. Williams, Jones and numerous other top UAW officials stayed in luxurious villas for as long as a month, dined on lavish meals, and spent hours on high-end golf courses, paid for from a “master account” with the resorts, whose purpose was to conceal the nature of the expenses.
While this fancy getaway had long been a fixture for the union, spending allegedly expanded “totally out of control” under Williams. For example, union bureaucrats spent $60,000 on cigars and related paraphernalia alone, as well as thousands of dollars on steaks and liquor. According to the memorandum, Williams spent $1,760 on four bottles of champagne specifically at the request of his wife.
Williams is still attempting to throw his fellow gangsters under the bus by claiming that he had no specific knowledge of where the funds came from, attempting to pawn responsibility off onto Jones in particular, who was Region 5 Director while Williams was president. Williams absurdly claimed that he suspected the hundreds of thousands of dollars in funds came from the union's “flower fund,” a claim that prosecutors have rejected and cited as a reason for recommending the maximum sentence under the plea deal.
In reality, prosecutors explained, Williams was instrumental in diverting the necessary additional funds to the union's annual bacchanalia. According to one anonymous UAW official who spoke with investigators, Williams responded to his concerns over the source of the funds by explaining that the money came from the union's “Regional Activity Fund.”
Taken as a whole, the facts laid out in the memorandum leave no doubt as to the need for workers to break with this rotten criminal organization and build new organizations of struggle. The reactionary social outlook of the UAW bureaucracy is not the product of a few bad apples, but of social and financial interests of the organization itself, which is bound by a thousand threads to the auto companies and to the capitalist state. The prosecution of a few corrupt officials in no way changes the anti-worker character of the UAW. The corruption probe has been aimed at upholding the authority of the UAW as a whole, promoting illusions that the union apparatus can be reformed by removing a few corrupt officials and imposing cosmetic measures such as the direct election of officers.
However, the UAW cannot be reformed. The enormous resources the UAW controls puts its officials in another social class entirely from the workers they falsely claim to represent. According to the latest LM-2 filings with the Department of Labor, the UAW national headquarters controls more than $1.127 billion in assets. The top 14 officials in the union collectively pocketed more than $3 million in salaries and expenses.
Current UAW President Rory Gamble had a declared income of $244,772 in 2020, while secretary-treasurer Ray Curry “made” $236,608. Curry personally ordered the end of the strike at Volvo Truck this past weekend in order to push through a sellout containing massive givebacks in health care. However, the real level of income of the bureaucracy, which includes salaries from various corporate boards and labor-management committees, is much higher.
Moreover, workers have no way of checking the accuracy of the figures reported on the LM-2s, which are signed off by the president of the union—that is, by Williams and his successors. There is every reason to believe that the reported sums are a significant under count.
The sentencing memorandum gives a sense of the scale of the direct infusions of corporate cash used to finance the bloated salaries of the top UAW officials. The UAW received more than $300 million in salaries and fringe benefits through Fiat Chrysler's National Training Center alone between 2003 and 2019. Williams and other officials were also provided with credit cards from the training centers, which they used to engorge themselves on fancy dinners back in Detroit.
While the memorandum attests that much of this money was distributed illegally, the joint programs themselves constitute a form of legal bribery, thanks to legislation passed in the late 1970s repealing laws against company payouts to unions.
The UAW was long ago brought forward as a full partner in the auto industry's campaign to cut jobs and compensation. Over the past forty-year period, during which time the union has collaborated in eliminating hundreds of thousands of jobs, the financial assets controlled by the UAW have ballooned. These assets, which include auto company stock in the retiree health care trusts funds managed by the UAW, give the union bureaucracy a direct stake in the lowering of the standard of living of autoworkers and the working class as a whole.
As the UAW has been fully integrated with the auto companies, its internal structure has been set up to systematically exclude the ability of ordinary workers to influence the direction of the organization. The memorandum notes that between 1983 and 2014—that is, for most of his career in the UAW—Williams “won” every election he stood in, unopposed. Williams’ elevation to the top of the union was not due to the slightest support from any section of the union membership, but due entirely to building up a base of support from highly paid union executives, among whom the UAW said Williams was an “institution” unto himself.
Vacation junkets, fine wine, million-dollar retirement homes, six-figure salaries and countless other perks represent, in the final analysis, a cut which the union receives from the company in exchange for concessions it imposes upon workers. Summing up the attitude of this social layer, the memorandum cites a 2015 Labor Day speech by Williams, where he declared that “CEOs and board members and Wall Street...didn't have a problem getting theirs, [so] we [should] not feel bad about getting ours.” While the speech was meant to suggest workers should get their share, the memorandum correctly states, “the ‘we’ that he helped ‘get theirs’ were the top-level officials, including himself.”
This is by no means unique to the UAW; similar dynamics exist in virtually every union in every country in the world. To take only one example, the UAW's counterpart in Germany, IG Metall, draws tens of millions of euros in income each year from joint labor-management “works councils.” Former IG Metall bureaucrat Bernd Osterloh recently accepted a position as head of human resources at Volkswagen's bus and truck subsidiary, where he will have an annual salary of €2 million.
While the federal government may be slapping the wrist of Williams and some of his fellow bureaucratic conspirators now, the capitalist state has deliberately encouraged and directed the corporatist integration of the unions into management for decades. In 2009, Joe Biden, then vice president under Obama, played key role in brokering a deal to hand the UAW billions in corporate stock in exchange for their support for savage wage cuts during the 2009 bailout of the auto industry.
Now, Biden is seeking to take such arrangements to the next level, directly relying on the unions to enforce national unity on the working class in order to prepare for conflict with China. Even as Williams awaits sentencing, the Biden administration is directly collaborating with the UAW to establish American dominance of the electric vehicle market.
Enormous levels of anger have built up among autoworkers, particularly as the UAW has directly collaborated in enforcing a deadly return to work during the pandemic. The way forward is through the formation of new organizations, rank-and-file committees, completely independent of and in opposition to the UAW. Only in this way can the great power of the working class be unleashed in defense of its basic rights. Such committees have already been built at factories and workplaces throughout the US and internationally with the assistance of the World Socialist Web Site.
Now, the WSWS and the International Committee of the Fourth International are fighting to join together the struggles of American workers with their brothers and sisters globally through the launching of the International Workers Alliance of Rank-and-File Committees (IWA-RFC). This movement will seek to assist workers in breaking free from the shackles imposed by the anti-democratic, right-wing, pro-capitalist unions of which the UAW is an odious example.
GM Announces $1 Billion Investment in Mexico to Build Electric Vehicles
Less than one day after President Biden proclaimed American workers would build the electric vehicles necessary to bring us into the zero admissions future, General Motors said it plans to invest more than $1 billion in Mexico to produce electric vehicles.
The automaker said Thursday it would make a $1 billion investment in its Ramos Arizpe production facility. The plant will begin producing at least one electric vehicle beginning in 2023, the company said.
The company did not disclose which vehicles would be produced at the plant or where they would be sold. But the plant currently produces parts and vehicles, including the Chevrolet Equinox and Chevrolet Blazer, that are sold in the U.S. and globally.
GM’s Spanish-language statement did not appear on its U.S. media site, only on GM’s Mexico’s media site, the Detroit Free Press reported.
The United Auto Workers union decried the decision to invest so much in the Mexican plant.
From the Detroit Free Press:
In a statement responding to the Mexico investment, United Auto Workers Vice President Terry Dittes, head of the union’s GM Department, said: “At a time when General Motors is asking for a significant investment by the U.S. government in subsidizing electric vehicles, this is a slap in the face for not only UAW members and their families but also for U.S. taxpayers and the American workforce.
“General Motors automobiles made in Mexico are sold in the United States and should be made right here, employing American workers,” he added. “That is why our nation is investing in these companies. Taxpayer money should not go to companies that utilize labor outside the U.S. while benefiting from American government subsidies. This is not the America any of us signed on for. Frankly, it is unseemly.”
In Wednesday night’s joint address to Congress, Biden said:
“So folks, there’s no reason why Americans — American workers can’t lead the world in the production of electric vehicles and batteries. We have the capacity. They’re best-trained people in the world. And all the investments in the American Jobs Plan will be guided by one principle: Buy American. Buy American.”
GM has said it plans to manufacture electric vehicles exclusively by 2035.
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