|Council files statement of defence in court case
BC Provincial Council of Carpenters argues case is about consolidating power in US
There may soon be some resolution of at least one part of the ongoing litigation against the Provincial Council started by the International two summers ago. After many meetings of discovery and grueling hours of testimony answering questions put by the Internationals lawyers, BC Provincial Council President Len Embree says that a Summary Proceeding will likely take place in the last week of May to deal with the Internationals search and seizure application. The judge will examine submissions from each side and then decide if there is enough information for a decision or if a full trial with called witnesses and cross examinations is required. Embree says if the judge rules that there are grounds for a full trial, that will likely happen in October.
This case is, on the face of it, an application by the International to seize the Provincial Council and all BC Local Union books and records. It was launched in June 2000 by United Brotherhood General President Douglas J McCarron, from Washington, along with his cohorts General Executive Board member Jim Smith, International Representative Dave Wright, Wayne Cox of Victoria Local 1598 and Mike Autzen of Floorlayers Local 1541. The suit, according to the Provincial Councils statement of defence, is in actuality, a bad faith action commenced for improper purposes related to the underlying dispute between the International and the Provincial Council to restructure the Union in British Columbia.
The point of this exercise, according to the Councils statement filed with the court in March, is to consolidate McCarrons personal power and influence within the Carpenters Union and enhance the power, influence, status and legal rights of the International in British Columbia, while reducing the rights and role of the Provincial Council to that of a meaningless entity. There is little point in seizing the Councils books as the International already has copies of all the audited statements going back to the founding of the BC Provincial Council of Carpenters in 1943. Plaintiffs Cox and Autzen sat on the Provincial Council Executive Board for many years and have had full access to all Council books and decisions. Autzen, until recently, was a Council Trustee who personally verified the books each year and found them in order. The annual budget, trustees report and audited financial statements of the Provincial Council are published each year in proceedings of the Convention and are available to any member.
The statement suggests that the real reasons underlying the Internationals suit include facilitating:
implementation of restructuring by edict of the General President without any vote of the members in British Columbia (based on imposing 33 mandatory bylaws which deny the memberships democratic right to vote)
creation of at as many as five Full Service regional councils in BC, each with appointed officers and executive boards
transfer of bargaining rights from the Council and its Locals to the International (contrary to the BC Labour Code)
transfer of all the assets of the Council, the BC Local Unions, and the Carpentry Benefit and Pension Plans to McCarron appointed officials
forcible mergers and transfer of assets of Local Unions without the ratification of the membership
The International, which is not recognized as a trade union under BC labour law, appears to be attempting to acquire legitimate bargaining rights by putting some Local Unions under supervision or trusteeship and then usurping their bargaining rights for themselves. Local 1907 (Mission Chilliwack) is mentioned as a possible target, as was Industrial Local 1928 (New Westminster). A supervision hearing against Local 1928 was instigated in 1999 based on the flawed report of an unqualified auditor from Toronto hired by the International who alleged financial impropriety. After initially trying to deny the Local legal representation and a subsequent two and a half days of hearings, the International had to agree that there was no fraud or misappropriation of funds and that the auditors report and the original complaint contained material inaccuracies. It was only after the Local applied to the Labour Relations Board that the International agreed to disclose the particulars of the charges before the hearing and allow the Locals lawyer to cross examine witnesses at the hearing.
The International has also launched four lawsuits against the Council and numerous affiliated Locals and individuals to force them to remit contributions to the International pension plan, even though the plan has been deregistered in Canada. The Statement of Defence alleges that the purpose of these suits is to intimidate individuals and undermine their support of the Council as well as bankrupt Locals which could then be put under trusteeship, allowing the International to acquire their bargaining rights.
Since 1999, McCarron has refused to approve changes to the constitution of the Provincial Council passed by majority referendum vote of the membership. He also stated in a meeting in Port Alberni in August of that year, that members would not have the right to vote on his brand of restructuringno vote on mergers, no vote on founding officers.
The Provincial Council was also threatened with supervision because two of the plaintiffs in the court action, Victorias Wayne Cox and Floorlayers Mike Autzen, were asked to leave the part of an Executive Board meeting that was to discuss the Councils response to their court case.
The Statement of Defence concludes that the suit is designed to interfere with the Provincial Councils ability to carry out the purposes, objects and responsibilities of a trade union on behalf of its members. Members of trade unions are entitled at law to exercise their democratic rights without interference, something McCarron seems incapable of understanding.
This late news received just at press time.
Court case delayed
The May Summary Proceedings have been postponed pending the outcome of mediation talks initiated by the Canadian Labour Congress. Former BCGEU President John Shields has been appointed ombudsman by the CLC to deal with the Carpenters application for Justification (see the previous issue of ON THE LEVEL). Shields mandate has been expanded to include acting as a mediator to determine if a negotiated solution is still possible. He has until May 31 to make that determination. Resolutions supporting the democratic rights of BC Carpenters have been pouring in from Unions and Labour Councils all over British Columbia to be presented at the CLC Convention in Vancouver starting June 10, 2002.
See Grand Jury Investigates McCarron Page 5
Stock windfall for labour leaders under scrutiny
A black eye for labour US grand jury investigates McCarron and others in ULLICO
by Josh Coles
In April, a US federal grand jury and the US Department of Labor launched separate investigations of UBCJA General President Doug McCarron. Both are investigating personal stock deals he made while sitting on the board of a union-owned insurance company.
The Wall Street Journal and Business Week Magazine report that the grand jury is probing whether McCarron and other US union leaders violated criminal and labour laws by using their positions on the board of governors of ULLICO Inc. for personal gain, while their unions own investments plummeted in value.
ULLICO, a privately-held company owned by Trade Union officials, was founded by the AFL-CIO in 1925 as Union Labor Life Insurance Co., to provide life and health insurance to union members.
McCarron has sat on the ULLICO board since 1996, guiding the investment of Carpenters Union pension funds and UBCJA cash. According to its 2001 financial statement, the UBCJA has over $14 million of its assets invested in ULLICOstocks.
For years, ULLICO invested conservatively and unions enjoyed moderate returns from their investments. But in 1997, a year after McCarron was appointed to its board, ULLICO changed investment strategies and invested $7.6 million in a risky telecommunications company start-up called Global Crossing.
While initially incredibly profitable, last year Global Crossing became the fourth largest bankruptcy in US history.
But during the good years, according to Business Week, ULLICO board members were allegedly given the opportunity to personally purchase ULLICO shares at bargain prices in anticipation of the big gains ULLICO was set to make in Global Crossing investments.
Board members, its alleged, were then able to sell their shares back to ULLICO before their value had been reset to reflect the unavoidable reduction in price related to Global Crossings accelerating fall during the recent industry-wide telecommunications crash.
Even though they knew ULLICOs troubles were jeopardizing their own unions funds, board members personal shares were protected because they voted in a procedure that fixed their personal shares final selling price. Board members sold their ULLICO shares at a price inflated by the good years of Global Crossing but untouched by its collapse.
Union and pension funds, with much larger stakes, did not enjoy the advantages of this Stock windfall for labour leaders under scrutiny A black eye for labour investigates McCarron scheme and got hit hard by ULLICOs exposure to Global Crossing, according to Business Week.
McCarron personally held 3,000 ULLICO shares which could have reaped well over $200,000 in personal profit from 2000 to 2001, depending on when he sold the shares. Meanwhile, carpenter union funds took a ULLICO bath. One union president who commented, Martin Maddaloni of the plumbers, admitted to making $184,000 by selling 2,000 of his ULLICO shares back to the insurer.
I didnt think there was anything wrong with it, Maddaloni told the Wall Street Journal, I just took advantage of the process.
According to the Journal, Maddaloni, who has served on the insurers board for two years, said ULLICOs in-house lawyers had blessed the transaction.
Overall, ULLICOs board members sold 73,000 of their 120,000 shares, Business Week says, giving them combined profits of at least $ 6.7 million.
McCarron has refused comment on the allegations. But the Wall Street Journal reports a McCarron spokesperson stating that the transactions were conducted properly.
According to Business Week, the grand jury is to determine if the board members are criminally liable for voting in a procedure where ULLICO repurchases of its stock confer benefits to board members at expense of their own unions investments.
There is also the question of whether McCarrons and others dealings in ULLICO stock created a conflict of interest that violated civil labour law. The Wall Street Journal reports that the U.S. Department of Labor is separately investigating this question a probe that potentially could lead to removal of McCarron as General President and invoke civil fines.
Business Week also points out that several anti-union corporations are primed to use the scandal in their propaganda against persistent organizing drives by their workers.
BC Provincial Council President Len Embree says McCarron should do the right thing and come clean about his personal investments. He should resign if in fact there is any conflict or wrongdoing, Embree said.
The Labour Global Crossing relationship
When did what happen at ULLICO from the Wall Street Journal
About two dozen labour leaders sit on the board of ULLICO Inc, which is an umbrella company controlling around $4 billion in insurance and union pension assets. ULLICO also controls Zenith Administrators which looks after most US Carpenters Union pension plans. Some timelines:
1996 Douglas J. McCarron is elected to the Board of Directors of privately held ULLICO Inc. joining with 28 other trade union representatives.
1997 ULLICO invests $7.6 million in Global Crossing, a telecommunications startup.
1999 Fall ULLICO is losing money on some of its other operations but earns $127 million by selling some Global Crossing stock. Insiders knew those gains would lift the annual evaluation of ULLICO shares from $54 to about $146 when its books closed at the end of the year.
1999 December ULLICO offers each director the chance to buy 4,000 ULLICO shares at the 1998 evaluation of $54. The union pension funds that own almost all of ULLICO arent given the same offer, or even told about it. 2000/01 December 2000/January 2001 ULLICO buys back 205,000 of its shares at $146 per share. Stockholders with fewer than 10,000 shares are allowed to sell all their holdings, so officers and directors can take full advantage, but the pension funds cant. Insiders know that the decline of Global Crossings stock puts the true value of ULLICOs shares closer to $75.
2001/02 December 2001/January 2002 ULLICO buys back an additional 200,000 shares, allowing officers and directors who hadnt sold before to cash out at $75. Again, insiders know that the further collapse of Global has again cut ULLICOs true value, this time to $44.
2002 March ULLICOs pension-fund shareholders now own a less valuable company. Its Global Crossing profits have gone disproportionately to officers and directors, some of whom are trustees of the union pension funds that lost out on the deal. Global Crossing shares, which peaked at just over $64 fell in March, 2002, to just 11 cents.
click http://www.laboreducator.org/ullico.htm for April 17 LaborTalk update by Harry Kelber
Vern Baisden scholarship started
Millwright members memory honoured
Honouring and remembering a faithful tradesman, unionist and family man, Selkirk College recently announced a scholarship dedicated to the memory of Vern Baisden, a Millwright Local 2736 member who was killed on the Keenleyside Dam project in April last year. He plunged to the ground when a man-lift malfunctioned. The Vern Baisden Memorial Scholarship will be awarded annually to a high-ranking Millwright Machinist student who has applied to the Millwrights, Machine Erectors & Maintenance Union Local 2736.
Columbia Power Corporation, along with Peter Kiewit Sons, Klohn-Crippen, SNC/ Lavalin, Fasken Martineau Dumoulin LLP, with matching funds from the Province of British Columbia, have endowed the Selkirk College Foundation with $21,000 to help reimburse the tuition to one student enrolled in the Millwright program.
A college spokesperson indicated that the first scholarship should be awarded this June.
Verns widow, Janet Baisden has written a dedication for the scholarship that describes her husband well.
To have known Vern is remembering his laugh and the kindness in his heart.
Vern loved life to the fullest and he always tried to have a positive attitude in everything he thought and did. He hated to see anyone waste their lives as there was so much to give and learn.
Vern loved his trade as a Millwright of over 25 years, and was very proud of being a member of the Millwrights Union. He took his work very seriously, but always tried to have fun with his work. Vern always said, Whatever it is that you choose to do in your life, make sure you love it.
Vern was also a dedicated member of AA, and was very active with the program. He had helped many people, whether it be through his works or his kindness.
Verns life was One day at a time.
If Vern were here, he would say, Be good to one another and love one another, because life is too short.
Lawsuit may go to trial soon
Dispute with International moving forward
COUNCIL COMMENT by Dave Flynn
Council expects spirited debate at this years Provincial convention in Vancouver
Between preparing for our annual convention, trying to stick handle through construction industry negotiations, advancing our justification application with the CLC, and dealing with the International lawsuit: describing the Provincial Council offices these last few months as busy would be a huge understatement.
Our 59th Convention will be held Thursday, April 18 through Saturday, April 20 at the Holiday Inn Downtown in Vancouver, and we are right down to the wire assembling the reports and preparing the delegates convention kits. A quick scan of the resolutions submitted indicates that there will be, as usual, spirited debate on a wide range of topics, including government attacks on workers, softwood lumber tariffs, the future of apprenticeship training, and of course the continued pursuit of autonomy from the International.
Our dispute with the International will be moving forward on a couple of fronts. On April 9 and 10, the Provincial Council officers will be meeting with John Shields, the ombudsperson appointed by the CLC to investigate our justification application. The mandate of the ombudsperson has been expanded to include mediation, so the purpose of these meetings will be to attempt to reach a mediated resolve.
If we are unable to come to an agreement the ombudsperson will complete his investigation and submit his report to the CLC executive. Based on the findings in that report the CLC executive will render a decision on our justification application.
On the other front, the Internationals lawsuit is scheduled to go to summary trial the fourth week of May. In the suit the International is seeking access to the Provincial Councils books and records. They say they are simply seeking an accounting of the Brotherhood assets in BC because they are concerned the Carpenters Union in BC may attempt to disaffiliate from the International. We say they are acting in bad faith; that they already have all our financial records, including audited financial statements, and the real reason for sending in their forensic auditor is to fabricate some excuse to place the Council under trusteeship. If the International were able to gain control of the Provincial Council, and the unions finances, they would be able to impose their restructuring program with minimal opposition. That is what this lawsuit is really about.
Construction industry bargaining suffered another setback earlier this year when the Labour Relations Board ruled that there is not a valid memorandum of agreement between CLR and the Bargaining Council. The memorandum of agreement was originally reached in December 2000. This agreement was set aside by a Labour Board decision that said the chair had exceeded his authority in accepting a counter proposal from CLR. To remedy this decision the Bargaining Council reaffirmed acceptance of the memorandum of agreement in June 2001. The validity of this agreement was also challenged at the Labour Relations Board, and on January 31 of this year the Board ruled that, because the Bargaining Council had not been properly instructed of all their options in the original decision, that the vote taken at the June meeting of the Bargaining Council was ineffective.
On February 27, CLR tabled a proposal for the Bargaining Council to consider. The new proposal was a renewal of the original memorandum of agreement reached over a year earlier, with a proviso that would allow for the settlement of outstanding trade issues with a few trades. The Trades are concerned that so much time has elapsed since the Main Table settlement and trade memorandums were reached, that membership expectations have changed. There is a general feeling that without some further improvements to the agreement it will be rejected by the membership The Bargaining Council is scheduled to meet again on April 12 to develop a counter offer to the CLR proposal. It is also expected that pending Labour Code amendments will provide the employers with more options, making it even more difficult for us to conclude an acceptable agreement.
Two significant General Contractors, PCL and Dominion, have withdrawn from CLR and wish to negotiate their own deal. Stay tuned, because indications are negotiations are a long way from over.
Spotlight on organizing by Josh Coles, provincial organizer
Needless tragedy on construction site
The entrance to the Stuart Olson project where Carlos De Vera died appears to support a safe work place with proper fall protection but the onsite reality was vastly different say workers
Carlos De Vera didnt have to die. In an all-too-common tragedy, the 36-year old labourer fell to his death from a 16-storey building last month on a non-union construction site already riddled with safety complaints. Carlos left behind his wife Judith, and their daughters Jennica, 4, and Bernadette- Rose, 18 months.
Details remain sketchy about the accident at the Broughton and Alberni job in Vancouver. De Vera co-workers have reported that he was cleaning some concrete off a fly-form when it dropped, sending him plunging a few floors down to a safety net, which gave way seconds later allowing him to plunge 12 storeys to a second-floor pony wall.
WCB and Bayside Forming Ltd, the company De Vera worked for, remain tightlipped about the incident. Bayside was the formwork subcontractor to Stuart Olson Construction on the residential tower project. According to carpenters union organizers, De Vera death was completely preventable. The union had filed safety complaints late last year on behalf of employees already concerned about Baysides practices.
Since December, Local 1995 organizers Apolo Suarez and Jan Noster have been monitoring the site regularly. The union knew Bayside had a history of safety and other worksite problems.
As the Vancouver Province reported after Carlos death, Bayside was hit with four WCB safety violations at another work site in downtown Vancouver late last year, including one in which construction material was allowed to fall onto and near the site trailer.
Then in December, in a separate investigation, the WCB found the company had improperly required an employee to buy his own safety harness, also a safety violation. Three other orders were also issued on matters in contravention of occupational health and safety regulations.
Then in February, the WCB found that a pinch platform had fallen within an airduct shaft due to improper installation. A worker was on the platform when it fell one level before it jammed. The carpenter grabbed a tie just before the platform fell and was rescued by another worker.
In addition to safety problems, the union has also laid several Employment Standards Branch complaints for abusive overtime practices. One former employee, who was fired in December for complaining about overtime, says Bayside requires some employees to worth 12-to-14-hour days, six days a week, without overtime. The union calculates its Employment Standards complaint should result in back-pay of thousands of dollars. All this for a company barely one year old.
The chaos that is todays construction industry allows companys with track records like Baysides to continue to get work.
Most non-union companies win low-bid jobs based not on decent minimums of safety and other conditions, but on raw construction costs.
Overly competitive low-bids lead to money-saving measures such as Baysides buy your own safety harness program and its refusal to pay overtime.
Worse yet, Bayside did not offer life insurance or other benefits to its employees. Instead of death and other health benefits, like those offered by union companies, De Vera family will have to rely on a small WCB pension.
Without a strong union presence, construction workers today are forced to live through a bidding game where workers and their families survive by luck, not minimum human standards.
Carpenters today are wedged between turn-of-the-century conditions and chronic unemployment. Jammed between risking termination while standing up for their rights or the fate of young fathers like De Vera.
Clearly it is a time to unite all carpenters under one banner. A flag that defends workers rights, non-union or union, and on or off the job.
A makeshift memorial remains at the job. Carlos De Veras family has set up a trust fund to help with the childrens education. Donations can be made to the Carlos_Monsada_DeVera_Trust at any branch of the CIBC. For information call the De Vera family at 604 324-5811
see also: "Union wants audit of fatal construction site" http://www.vancourier.com/041102/news/041102nn5.html
A first step to effective organizing
Labour movement rallies against service cuts
Liberals unsurpassed for meaness and vindictiveness
PRESIDENTS CORNER by Len Embree
One of the supposed side benefits of being long in the tooth is that, having been around long enough, you have eventually seen it all. This was especially applicable when it came to provincial politics.
Unfortunately, for all working people in BC, this gang in Victoria is the proverbial exception. Whether I go back to W.A.C. Bennett or, god forbid, even consider the Vander Zalm administration, none compare to this BC Liberal gang for outright vindictiveness, meanness, and reactionary ideology.
Not too surprisingly, the response by the labour movement to this outright attack has been active, direct, and united. The play by the press to portray the opposition to the Liberals as a public sector issue has fallen on deaf ears. Anyone who participated in the Victoria rally or, indeed, the local rallies held around the province cant help but be inspired by the involvement of a cross section of our communities. It seems to me that these rallies present a unique opportunity for our union to establish ourselves, and what we stand for, in both the labour community and the community as a whole. This has to be the first step to any effective organizing for our union.
There have been a number of resolutions submitted for consideration to our Convention on the issues of support for the public sector unions and also support for a long-term, concerted fightback against this Liberal regime. I look forward to the debate, and am confident that our union will be prepared to take a leadership position in this battle. Of course, in this regard, we can be considered a public sector interest as we represent several hundred School Board employees in a halfdozen Locals around the province.
International battle and softwood lumber
Which brings me to the other major battle in which we are embroiled: the one with the International. Its difficult, if not impossible, not to compare the similarity in attitude towards peoplein this case members between the Liberals and McCarron and his administration. Lets start with the Canadian softwood lumber issue. Even though its a matter of record that GP Doug McCarron and the United Brotherhood of Carpenters & Joiners of America are petitioners in support of this countervailing tariff, we are presented with some lame excuse that their position is about fair trade. Talk about American jingoism. The question remains: whats fair about using our members dues to support a position that in all likelihood will put our members out of work. This one issue, probably more than any other, points out the injustice to our members that results from the power structure of the International. A look at the costs involved in defending ourselves from the two lawsuits also is quite enlightening. They receive dues from us to use to initiate lawsuits to force positions on us that they know full well are not supported by the members.
What the hell does this have to do with representing workers and being accountable to them? If it werent so tragic it would be humorous.
What is equally astounding is the unequivocal support they retain from lawsuit plaintiffs Cox, Autzen, and Wright. Im somewhat comforted by the fact that in my experience when members of any union discover they have been used they usually rectify the situation with a passion.
Tentative dates for summary trial on the search and seizure issue have been set for the fourth week in May. If no decision is reached, a fullblown trial could be scheduled for October.
One other update on the Canadian Labour Congress justification application: Brother Flynn and I are scheduled to meet on April 9 and 10 with John Shields, former head of the BCGEU. Brother Shields is acting as ombudsperson for the Congress on this issue. Hopefully, we will be able to give a more complete report at Convention.
In closing, I would like to say Im quite flattered by the Internationals expressed interest in my column. I fully expect to have it quoted back to me by some paid flunky at some future date.
I look forward to seeing a number of you at Convention. I also look forward to the deliberations that will take place at Convention..
Thats the view for now from this comer.
In the Matter of: CERTAIN SOFTWOOD LUMBER PRODUCTS FROM CANADA
PETITION FOR THE IMPOSITION OF ANTIDUMPING DUTIES PURSUANT TO SECTION 731 OF THE TARIFF ACT OF 1930, AS AMENDED
PUBLIC VERSION VOLUME I
ON BEHALF OF THE COALITION FOR FAIR LUMBER IMPORTS EXECUTIVE COMMITTEE,
THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS, and
THE PAPER, ALLIED-INDUSTRIAL, CHEMICAL AND
ENERGY WORKERS INTERNATIONAL UNION
DEWEY BALLANTINE LLP
1775 Pennsylvania Avenue, N.W.
Washington, D.C. 20006-4605
Counsel for the Coalition for Fair Lumber Imports Executive Committee
Dated: April 2, 2001
Above is a representation of the 65-page petition for softwood lumber tarrifs on behalf of the UBCJA that can be downloaded from the Dewey Ballantine LLP Trade Group website at http://www.dbtrade.com/casework/softwood/Default.htm