UAW President Denies Collective Bargaining Deals Tainted by Scandal -- Update
January 26 2018 - 7:14PM
Dow Jones News
By Chester Dawson
DETROIT -- The head of the union representing thousands of auto
workers denied a former Fiat Chrysler Automobiles NV executive who
pleaded guilty to violating labor laws unduly influenced the
outcome of negotiations between the union and his company.
Dennis Williams, the president of the United Auto Workers, said
in an open letter to union members Friday that collective
bargaining agreements reached in 2011 and 2015 were not tainted by
allegedly illegal payments made by the former executive to senior
UAW officials.
"The is simply no truth to the claim that this misconduct
compromised the negotiation of our collective bargaining agreement
or had any impact on union funds," Mr. Williams said in the
letter.
The UAW represents more than 100,000 factory workers employed by
Fiat Chrysler, Ford Motor Co. and General Motors Co. It negotiates
collective bargaining agreements with the three companies on a
quadrennial basis.
The scandal involving the allegedly illegal payments to senior
union officials comes at a time when the UAW has faced setbacks in
its attempts to organize workers in several foreign-owned
automotive plants in the U.S.
Mr. Williams' unusually public statement was issued just days
after Alphons Iacobelli, the former head of labor relations at Fiat
Chrysler, reached a deal with federal prosecutors. At a district
court hearing on Monday, Mr. Iacobelli said he "knowingly and
voluntarily joined an ongoing conspiracy" to authorize more than
$1.5 million in illegal payments to UAW leaders.
Mr. Iacobelli's lawyer could not be reached for immediate
comment on Friday.
A grand jury indicted Mr. Iacobelli in July for what the
government alleged was his role to funnel money from Fiat Chrysler
through a union training center to top union officials. He pleaded
guilty to making those payments and filing a false tax return to
hide some $840,000 siphoned from company coffers for his own use,
including buying a Ferrari and building a swimming pool at his
home.
Federal prosecutors allege the misconduct began in 2009, the
same year Chrysler emerged from bankruptcy, and continued through
2014.
The UAW reached a four-year labor deal with the UAW in 2011.
Representatives for Fiat Chrysler could not be reached for
immediate comment late Friday, but they have previously referred to
a statement last year saying the alleged actions by the former
labor executive "were neither known to nor sanctioned" by the
company. CEO Sergio Marchionne echoed that position in a July email
to employees.
The payments were allegedly made to several union officials,
including a now-deceased UAW vice president, General Holiefield,
during a time when he was the union's top negotiator for bargaining
with Fiat Chrysler.
The union said previously it has removed a handful of officials
it believes to have been connected to the alleged conspiracy and
launched its own internal investigation into the matter led by an
outside counsel.
Mr. Iacobelli left Fiat Chrysler before the start of union
negotiations in 2015 and after that consulted for General Motors on
labor matters. GM has said he no longer works for the company.
Prosecutors alleged Mr. Iacobelli worked with others at FCA to
create a liberal spending policy for training-center credit cards
to keep senior UAW officials "fat, dumb and happy."
Others netted in the investigation include retired UAW associate
director Virdell King, once a fast-rising star at the union who
pleaded guilty to charges related to the federal investigation will
be sentenced in the coming weeks.
Mr. Williams said in the letter he was "shocked and saddened" by
the revelations alleged by prosecutors. "We have initiated many
reforms so they will never be repeated," he said.
The indictments of the union officials last summer came just
ahead of two key votes at automotive-related plants the UAW hoped
to bring under its wings. In August, workers at a Nissan Motor Co.
factory in Canton, Miss., rejected a UAW campaign to organize and
three months later the union lost a separate vote at a
Chinese-owned automotive glass plant in Moraine, Ohio.
The UAW also failed in a 2014 bid to organize assembly line
workers at a Volkswagen factory in Chattanooga, Tenn.
According to documentation filed as part of Mr. Iacobelli's plea
deal, the payments from Fiat Chrysler to UAW officials included
credit card purchases of electronics, furniture and jewelry, as
well as a $262,219 check from UAW-Chrysler National Training Center
to pay off the mortgage of Mr. Holiefield and his wife. That
payment was made six months after the union leader was "scripted"
to advocate on behalf of Fiat Chrysler, the court documents
said.
Mr. Williams said the collective bargaining agreement reached in
2011 was not "single-handedly" controlled by Mr. Holiefield, and
that "its terms were reviewed, negotiated and approved at the
highest level of our union, including the UAW president," who at
that time was Bob King. Mr. King served as the leader of the UAW
from 2010 to 2014, when Mr. Williams took over as president.
The letter specifically rebuffs an allegation made by Mr.
Iacobelli in his plea agreement that offers of $50,000 retirement
packages to senior UAW officials swayed negotiations between the
union and Fiat Chrysler. Mr Williams said that proposal was
rejected after being reviewed by UAW counsel and no such money was
ever paid.
Write to Chester Dawson at chester.dawson@wsj.com
(END) Dow Jones Newswires
January 26, 2018 19:59 ET (00:59 GMT)
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