CONFIDENTIAL: NOT FOR PUBLIC FILING
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK UNITED STATES OF AMERICA, Plaintiff, 90 Civ. 5722 (CSH) -against- DISTRICT COUNCIL OF NEW YORK CITY AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, et al., Defendants. INDEPENDENT INVESTIGATOR'S REPORT ON
TABLE OF CONTENTS Introduction 1 I. The Interplay of the 50/50 Rule and the Request System 2
Employers' After-the-Fact Requests 5
U. The Union's Failure to Supervise Hiring and to Enforce the 50/50 Rule 14 III. Non-Compliance With the Terms of the International Agreement 18 Conclusion 20 INDEX TO EXHIBITS ON 50/50 REPORT 24
Introduction I respectfully submit this report to the Court, the District Council and the Government' pursuant to the Stipulation and Order between the parties, dated October 21, 2002 ("the Order"), ¶ 6 (i). This is one of a series of reports I am submitting pursuant to the Order, following months of depositions – which are ongoing – of District Council Carpenters, business agents, shop stewards, journeymen, foremen and contractors, covering various subjects related to the Out-of-Work list. As I stated in my Report to the District Council of Carpenters Concerning the Operation and Effectiveness of its Anti-Corruption Program, dated June 15, 2004 ("the Anti-Corruption Report"), the Out-of-Work List ("OWL") is of threshold importance to the success of the Anti-Corruption Program.2 (Anti-Corruption Report at 9.) It has always been my understanding that the purpose of the OWL is to insure that out of work Carpenters are dispatched to jobs on a non-discriminatory basis. I had naively believed that the "50/50" rule, incorporated in most Carpenter collective bargaining agreements ("CBAs"), was designed to work with the OWL system so that for half of the Carpenters ' A draft of this report was submitted to the District Council for comment on October 14, 2004. I received the District Council's written comments on October 27 and this report reflects changes I made in response to those comments. I have acceded to the District Council's request that, for their own reasons, I not submit Mr. Rothman's letter with this report as an exhibit, although my preference would have been to do so. However, the District Council has asked me to express its position that it reserves the right to submit Mr. Rothman's letter on its own initiative at a later date. 2 The OWL was created by Job Referral Rules adopted pursuant to the 1994 Consent Decree. (Consent Decree dated March 4, 1994, ¶ 5 and Exhibit A thereto.)
on any job site, the members who have been out of work the longest are the first to be dispatched. I was wrong. The vast preponderance of jobs are performed by contractors who are members of associations having CBAs with the district council. In practice, these contractors routinely choose more than ninety per cent of the Carpenters employed at their sites. The Carpenters chosen by association contractors frequently never miss a day of work and, through the operation of the request system, jump over carpenters who often have been on the OWL for months. This practice is so routine and prevalent throughout the District Council's jurisdiction that I believe the term "out-of-work" list to be a misnomer. By this comment, I in no way seek to impugn the skill and dedication of the OWL supervisor and his staff without whose work the District Council's Anti-Corruption Program could not function. I. The Interplay of the 50/50 Rule and the Request System As noted above, currently most District Council CBAs contain a "50/50" rule, whereby the contractor is permitted to hire 50% of the Carpenters on a particular job without reference to the OWL. (See, e.g., Building Construction Agreement between Building Contractors Association, Inc. and The District Council, July 1, 2001-June 30, 2006, Article VII, Section 1, p. 15 and "Side Letter" effective October 1, 2001, Article VII, Section 1, pp. 55-56, submitted herewith as Exhibit 1.)3 The 50/50 rule as described 3 A number of contractors, not members of contractor associations, are signatories to Independent Agreements – CBAs with the District Council which do not allow the contractors to 2
in most of the CBAs is diluted by the implementation or re-introduction, in the past few years, of the practice of permitting the contractor to satisfy the requirement of hiring 50% of the Carpenters from the OWL by requesting particular Carpenters from the list — regardless of those Carpenters' time on the list. (Id.)4 Thus it is possible and, indeed, common for a contractor to hand-select the entire crew of Carpenter journeymen. (Requests are not permitted for the hiring of the shop steward, who must be hired directly from the OWL.)5 Moreover, the 50% taken from the OWL can be selected without regard to how long they have been on the list. And, as I demonstrate below, even the employ the request system, discussed at length below, and therefore do not result in a contractor selecting more than 50% of the Carpenter journeymen on a job site. 4 A request system was contemplated in the Job Referral Rules attached to and incorporated in the 1994 Consent Decree (Exhibit A thereto, ¶ 5B), but there was no 50/50 rule in that document. Therefore, it is my understanding that the 1994 "request" rule, which allowed a contractor to hire any Carpenter who had worked for that contractor in the previous six months without regard to the OWL, contemplated that all (as opposed to 50%) of the non-requested contractors would be hired directly from the OWL. In any event, it is my reading of Judge Conboy's writings on this topic that the request system was still a matter for further evaluation. It is also my understanding, based on the more than twenty Carpenter depositions I have taken, that the request rule was dormant for some time and was re-introduced with the CBAs that were entered into starting three or four years ago. The advantage of this change to association contractors is absolutely clear but its justification and its fairness to out of work Carpenters is not- Because of conflicting views of the relevant history provided by different sources, and the diversion of limited Independent Investigator resources, I decided not to undertake an investigation into how and when the request rule was integrated with the 50/50 rule. Certainly I am willing to do so if directed by the Court. 5 The ability, until recently, of certain shop stewards nevertheless to manipulate job assignments without meaningful sanctions is the subject of ongoing depositions and will be covered in a separate report to the Court. (My June 29, 2004 report on John Corrigan also dealt with this subject.) I am pleased that in the past few months, since I began to draw the District Council leadership's attention to this problem, it appears to have received more corrective scrutiny from the District Council than it did previously. 3
requirement that the requested journeyman be selected from the OWL is often circumvented. The request system is implemented so liberally that, for the 50% of the Carpenters listed on the OWL, contractors can select the members they wish even if those Carpenters have been on the OWL for less than a day. (See, e.g., Deposition of Edward Picirillo, field superintendent for R&J Construction ["Picirillo Deposition"], submitted herewith as Exhibit 2, at 101; Deposition of Michael Nee, shop steward ["Nee Deposition"), submitted herewith as Exhibit 3, at 174, 200-01; Deposition of Michael Mitchell, shop steward ["Mitchell Deposition"], submitted herewith as Exhibit 4, at 154-55.) The District Council concedes that the OWL rules prohibit an employed Carpenter from placing his or her name on the list. (Letter of Gary Rothman, dated October 29, 2004, p. 7.) However, the District Council points out that there is no rule requiring a Carpenter to be on the OWL for any particular period of time before being referred to a job. (Id. at 6.) As to whether there should be such a rule, I am somewhat confused by the District Council's position. The District Council says, on the one hand, that it opposes a required time period — even a period as short as one day — on the list. (Id.) However, the District Council also says that "[w]hether there should be a waiting time before a 'lawful request' could be made for a particular Carpenter is a separate issue to be considered by the District Council [in conjunction with any constraints imposed by the CSAs]." (Id.) Perhaps the District Council is considering imposing some period of 4
unemployment before a Carpenter can be requested from the list, but I must point out that my expressed unhappiness with the request system as it impacts the 50/50 rule dates from the very earliest months of my appointment and the District Council could have resolved its policy position on this subject well before now. A. Employed Carpenters Putting Their Names on the OWL and Employers' After-the-Fact Requests The documentation I reviewed' also demonstrates that Carpenters frequently put their names on the OWL even though they are employed at the time they do so. My comparison of OWL records and shop steward reports revealed that "company" Carpenters already working on job sites frequently placed their names on the OWL while they were still working – either during or at the end of the workday – and were subsequently requested from the OWL by their employer. It is obvious that the Carpenters had no break in employment during their transformation from "company" workers to "union" workers.' The District Council now acknowledges that this is unacceptable. (Letter of Gary Rothman, dated October 29, 2004, pp. 8-9.) However, my analysis of shop steward reports and related documents demonstrates that the practice was 6 In order to protect the deponent? privacy, I am not submitting Carpenters' work and benefits records as exhibits but will of course produce them to the Court upon request, with such redactions as the Court permits. 7 The short-hand terminology "company" and "union" in this context is somewhat misleading. All of the Carpenters are, of course, union members. But the company/union dichotomy is typically used by Carpenters to distinguish between members hired directly by the company and those who are dispatched from the OWL. 5
routinely engaged in from, at the very least, the earliest stages of my work. Several Carpenter witnesses conceded that they did this, often at the direction of the employer, in order to render the employer in apparent compliance with the 50/50 rule. Robert DeFeo, a shop steward, testified that under the 50/50 rule, as impacted by the request system, an employed Carpenter can be transformed from a "company" hire to a "union" hire simply by putting his name on the OWL and then being requested. (Deposition of Robert DeFeo ["DeFeo Deposition"], submitted herewith as Exhibit 5, at 163-64.)8 In explaining that it does not matter whether the Carpenter is actually out of work when he puts his name on the OWL, Mr. DeFeo said that this "happens every single day" and that it "goes on with every company." (Id. at 164-65.) Yet, the Job Referral Rules that were attached to and incorporated in the Consent Decree provide that "[o]nly members who are not currently employed at the trade may register their availability for referral." (Exhibit A to Consent Decree, 4 C.) Shop steward Michael Mitchell also expressed the view that it is permissible to convert a "company" hire into a "union" hire by simply submitting a request for him, as long as he is listed on the OWL: The way the 50/50 is now, it is very easy for the company to adhere by the guidelines that are set forth in place now. All they have to do is send in a request 8 Mr. DeFeo's foreman at R & J Construction, Herald Addington, was less forthright about how 50/50 "matches" were effected. Mr. Addington testified that when he needed Carpenters from "the union side," i.e. , from the OWL, he would ask Mr. DeFeo to have Carpenters sent from the union. (Deposition of Herald Addington, relevant portions of which are submitted herewith as Exhibit 6, at 70-71.) 6
for a guy and he becomes a union – you know, he is from the [union] hall, basically. (Mitchell Deposition at 128.) Mr. Mitchell went on to explain that if Carpenters have "shaped" a job – shown up on their own, seeking work – he will call the union or ask the foreman to call the union and request these individuals in order to avoid having "the ratio . . . out of whack." (Id.) Pursuant to questions based on documentation I had reviewed, Mr. Mitchell testified about two Carpenters who were employed by one contractor, OnPar Construction, Inc., at the time they put their names on the OWL (id. at 150, 155-56) and acknowledged that while working for another contractor he himself had put his name on the OWL after he already was on the job. (Id. at 44.) This practice is sometimes engaged in by Carpenters working for a contractor on one job site who are being transferred to another job site controlled by that contractor. It often occurs even with respect to Carpenters already at work on the very job site for which they are subsequently (and quickly) "requested." Michael Edward Brennan, another Carpenter who often served as a shop steward for OnPar Construction, also testified that on a number of occasions Carpenters already working for OnPar put their names on the OWL and were then requested by the company after being on the list for as little as an hour or a day. (Deposition of Michael Edward Brennan ["Brennan Deposition"], submitted herewith as Exhibit 7, at 66-67.) Similarly, when I asked R & J Construction field superintendent Edward Picirillo if it was appropriate for a Carpenter to go on the list and get requested even though he is not out of work, Mr. Picirillo replied, "As far as I'm concerned, if you get requested, you're 7
requested." (Picirillo Deposition at 102-03.) Mr. Picirillo, too, testified that the purpose of having a Carpenter put his name on the OWL while he already is at work is to insure that the company is or appears to be in compliance with the 50/50 requirement. (Id. at 108-09.) He testified further that no shop steward had ever advised him that it was necessary for a Carpenter to be out of work before he could be requested. (Id. at 131)9 Shop steward Michael Nee initially testified that the 50/50 rule requires a Carpenter to be laid off before he can be requested – although he also testified that this person could be requested from the OWL and be re-hired the following day. (Nee Deposition, Exhibit 3, at 177-78.) When confronted with my findings (which reflected a comparison of dispatches to names and dates on the OWL) that every Carpenter journeyman at the Century Maxim job site at which Mr. Nee was the shop steward had already been working at the site at the time they were requested from the OWL, he conceded that such Carpenters actually should be counted on the "company" side of the 50/50. (Id. at 171-84, 189-90.) Yet, he told me, the practice of quickly and artificially converting "company" men to "union" men was universal: "Century is not different from any other company. That's what they all do[.]" (id. at 182) and it "happens every day" (id. at 173). Patrick Lynch, another shop steward for Century Maxim, conceded that he 9 Mr. Picirillo's testimony on this subject was inconsistent, reflecting what I believe to be his understanding that the request system as practiced runs afoul of even the liberal request provision that has been written into most of the CBAs during the last few years. Elsewhere in his deposition he testified that "[h]ow a company man becomes a union man is when we are finished with him and he goes on the list and we call him back to work. That's the only way he can become a union man." (Id. at 89, see also 90-91, 93, 130.)
had put his name on the OWL after he was already on the job; he said that he did so at the company's request "to keep the 50/50."10 (Deposition of Patrick Lynch ["Lynch Deposition"], submitted herewith as Exhibit 8, at 227.) Although I am aware that the hard-working OWL staff randomly checks shop steward reports against the OWL to see if working Carpenters nevertheless have their names on the OWL (Letter of Gary Rothman, dated October 29, 2004, p. 7), none of the individuals whom I deposed, whether journeymen or shop stewards, had ever been queried on the subject, much less sanctioned.11 Given the random nature of these reviews and the fact that the only punishment for journeymen is likely to be a modest fine, it is not surprising that Carpenter journeymen are unlikely to be deterred from "riding the list," preferring to assume the risk of getting caught and paying a fine of a hundred dollars. (See Deposition of Michael Dolphin, submitted herewith as Exhibit 9, at 51-52.) cannot say just how widespread the practice of "riding the list" is, for I do not know with any precision what portion of violators are represented by the randomly-identified wrongdoers. I do know that we continue to receive hot-line complaints about stewards who seem to be routinely dispatched to desired job sites and employers. And given the 10 Mr. Lynch made this concession after conferring with his attorney once I had told him that I had the shop steward report showing when he started on the job. Id. at 226-27. 11 I intend to review the operation of the District Council's disciplinary system in a future report. I was disappointed in the limited corrective actions undertaken by the District Council in response to the information we obtained from initial shop steward depositions. However, I believe that recently the District Council has begun to treat these violations more seriously. 9
consistent Carpenter testimony that the association contractors direct employees to put themselves on the list either while they are working or at the conclusion of a workday to be requested the next morning, I must assume that the violators identified by the OWL staff are but a small portion of the actual violators. B. The 50/50 Rule Is Widely Perceived as Meaningless The effect of the combination of the request system and the 50/50 rule is, I submit, clear from the above discussions. Therefore it is not surprising that many of the witnesses whom I deposed expressed the view that the 50/50 rule as it currently operates is meaningless. As shop steward Robert DeFeo put it: "50/50 is 50 percent company, 50 percent union, but with the requests, it is called 50/50 but it is really not 50/50 . . . . You can request anybody you want from the company and put them on the list and request them." (DeFeo Deposition at 154.) With respect to a Century Maxim job about which I questioned shop steward Michael Nee, he conceded that everyone on the job was, in reality, a straight company hire. He said that some Carpenters had "shaped" the job but that most of them were known to the foreman or the superintendent and had a history with the Company.12 Mr. Nee went on to tell me that "[t]o me, there's no 50/50 . . . It's only on paper. . .. As far as the 50/50 goes, the same guys is [sic] working all the time." (Nee Deposition, Exhibit 3, at 162; see also, id. at 214-15.) Shop steward Patrick Lynch also 12 Carpenters who "shape" a job are also supposed to be counted within the company's 50% because they are not dispatched from the OWL. 10
testified that "[t]here's no 50/0 on any job." (Lynch Deposition at 203.) Echoing Mr. Lynch's testimony, Robert DeFeo testified that every company avoids having to comply with the 50/50 rule by using the request system, enabling the contractor to control which Carpenters he hires. (Id. at 165-66.) Similar testimony came from other witnesses. Mark McMorrow, a foreman for Boom Construction, testified that he cannot remember Boom hiring a Carpenter journeyman who had not been requested by the company. (Deposition of Mark McMorrow ["McMorrow Deposition"], submitted herewith as Exhibit 10, at 83.) Derek McKenna, one of Boom's owners, confirmed this, testifying that nine of the ten Carpenters his company hires are requested from the OWL (after he directs them to place themselves on the list). (Deposition of Derek McKenna, submitted herewith as Exhibit 11, at 212-13.) Shop steward Lynch testified that the 50/50 rule has been rendered "meaningless" by the request system that was implemented, or re-introduced, a few years ago. (Lynch Deposition, Exhibit 8, at 59-61.) He said that prior to the implementation of this system, -- 50% of the Carpenters on a job actually came from the union hall. (Id.) John Corrigan (the shop steward who was the subject of my report to the Court dated June 29, 2004), testified that the request system is "a joke" and that it is unfair to Carpenters who are new or who do not have connections in the industry. (Deposition of John Corrigan, submitted as Exhibit 12, at 145.) Shop steward Michael Mitchell termed the 50/50 rule as it 11
currently operates "ridiculous." (Mitchell Deposition, Exhibit 4, at 151, 152-53.) Indeed, it does seem to be an absurd paperwork dance in which contractors and many or most of the Carpenters they hire engage. The most well-articulated analysis I heard of the combined effect of the 50/50 and request rules was given by Dennis Gimblet, a shop steward I recently deposed, who summarized an extemporaneous speech he had made at the May meeting of Local 608: My opinion of the 50/50 that I expressed, was that due to the abuse of the request privilege now afforded the signatory contractors under our agreements, that the 50/50 has become worthless, that now essentially – I made the observation that the phones of our members aren't ringing, but the fax machines are humming between the contractors and out-of-work list, and it is a revolving door of the same individuals who are going to these projects, and our members are sitting on the out-of-work list. Deposition of Dennis Gimblet ("Gimblet Deposition"), submitted herewith as Exhibit 13, at 45. Mr. Gimblet then described other drawbacks of a job site with so many carpenters whose primary allegiance is to the contractor rather than the union. He said that such workers want to protect their standing with the contractors and therefore do not "make waves" when rights contained in the CBA – such as lunch hours and the absence of production quotas – are violated. (Id. at 47.) I share Mr. Gimblet's concerns. I understand the District Council's response, which is that the construction industry should not be "exempt from free market forces" and that contractors should be able to hire the Carpenters they see as most productive. (Letter of Gary Rothman, dated October 28, 12
2004, p.11.13 This, of course, is a policy issue for the parties and the Court to decide in light of the purposes and history of the Consent Decree. C. Failure to Even Perform Paperwork Requirements Clearly it is easy for contractors to hand-select their entire crew of Carpenter journeymen under the request system; all they have to do is submit a request for a Carpenter who has placed his name — even a few minutes before — on the OWL. Nevertheless, there were a surprising number of instances where even this effort had not been undertaken. Rather, the contractor was permitted to hire, ostensibly from the OWL, Carpenters already in its employ without even going through the step of issuing the request that would put them in seeming compliance with the 50/50 requirement. This obvious type of violation was acknowledged by R & J field superintendent Edward Picirillo when I confronted him with a shop steward report showing all of the Carpenters on an R & J job, with the exception of the shop steward, as "company" hires. (Picirillo Deposition at 98-100). Another example of this type of occurrence was 13 Another troubling issue that was discussed during Mr. GimbIet's deposition is an exemption from the OWL rules granted by the District Council to Carpenters working at the Jacob Javits Convention Center and other trade show sites. Working Carpenters are permitted to keep their names on the OWL while they are employed at trade shows. (Gimblet Deposition [Exhibit 13] at 65-66.) I have not been able to find any written policy statement setting forth this exemption. Assistant United States Attorney Lisa Zornberg, who was present at the Gimblet deposition, has sent the District Council a written request for, inter alia, information relating to this and any other exceptions to the out-of-work list rules. (Letter of AUSA Lisa Zomberg to Gary Rothman, Esq., dated October 15, 2004, a copy of which is submitted herewith as Exhibit 14, pp.1-3.) I intend in the immediate future to assess this trade show exception to the OWL requirements, modest as they currently are. 13
presented when I questioned one business agent about the absence of a 50/50 breakdown of Carpenters as reflected on the shop steward reports for a DiFama Construction job site. This business agent told me that he had noticed the problem and had raised it several times with the foreman on the job to no avail. Apparently no grievance procedure or other enforcement action was undertaken by the union. (See Deposition of Joseph Firth ["Firth Deposition"], submitted herewith as Exhibit 15, at 204.) In response to my criticism of this type of blatant failure to enforce the 50/50 rule even in its current diluted form, there has been a marked improvement on the part of the shop stewards and business agents to insist that the shop steward reports be at least facially compliant with the 50/50 requirement. IL The Union's Failure to Supervise Hiring and to Enforce the 50/50 Rule The ability of contractors, early in my tenure, to avoid even the simple task of creating a paper request for workers already in their employ — so that shop steward reports would on their face indicate compliance with the 50/50 rule — underscores the fact that, until depositions I took highlighted this issue, there had been little or no effort by the District Council or the Locals to enforce the 50/50 rule. My review of shop steward reports demonstrated that up to about one year ago, the business agents at the Locals were not always even examining the shop steward reports for compliance with the 50/50 rule despite the fact that the Locals are routinely provided with the OWL dispatch sheets reflecting whether the dispatched Carpenter is "company" 14
or "union." Indeed, as previously stated, I found numerous shop steward reports on which all or most of the Carpenter journeymen were listed as company men, in obvious contravention of the 50/50 rule. Early on, I found no instance in which a business agent or any other union representative had questioned these glaring violations of the 50/50 rule. Not surprisingly, therefore, when I questioned a shop steward about his reports showing that the foreman – by definition a "company" worker – had been converted into a "union" man when he was requested from the list, he told me that no business agent had ever found fault with any of his shop steward reports. (Deposition of Jason Flaherty ["Flaherty Deposition"], submitted herewith as Exhibit 16, at 50-51, 73-75.) Based on my reviews of more recent paperwork and on revisions by the District Council to the forms used, I believe that the business agents and shop stewards are now undertaking greater efforts to see that the shop steward reports are compliant with the 50/50 rule even if, in my view, the rule is comprornised by the request system as incorporated in the CBAs now in effect. Then there is the issue, discussed above in Section I.C, of journeymen being listed on shop steward reports as having been dispatched from the OWL when no request for them was even made. A simple comparison of the shop steward reports with the OWL dispatch sheets received at the Locals would enable the business agents to identify those situations. I questioned one shop steward about two weeks of shop steward reports designating journeymen as "union" dispatches from the OWL despite the fact that 15
documentation I received from the District Council showed that no contractor requests for them had been made. This shop steward testified that he relied on the business agent to confirm that Carpenters showing up on the job site as "requests" have in fact been requested. (Id. at 193-97.)14 To the District Council's credit, it has begun to require the OWL staff to note on each of the dispatch reports sent to the Local Union at the end of the day whether the dispatched Carpenter is "union" or "company." This should result in straight "company" hires being designated as such. I also believe that the business agents at the Locals can eventually be doing more than simply comparing the dispatch records with the shop steward reports but the Court and the parties must determine whether Carpenters have to be actually out of work for at least some particular period of time before listing themselves on the OWL. If some actual out-of-work time is required, one indication of abuse would be a Carpenter's listing on the OWL preceding the contractor's request by only minutes or hours. This would alert 14 It is the business agents in the Locals who receive the dispatch records from the OWL office. The documents are not typically provided to the shop stewards unless they seek copies, which is probably the better practice so that there is support for the designations on the shop steward reports. An issue on which I question the practice of the shop stewards as well as the business agents and higher union officials is the failure to enforce the CBA's apprentice/journeyman ratio. The CBAs typically require two apprentices for every five journeymen. Shop stewards I questioned were either unsure of what the ratio is or took no steps to enforce it. (Flaherty Deposition at 57-60; Nee Deposition at 204; see also, Addington Deposition at 79-80; McMorrow Deposition at 80-81.) The Apprentice Program seems based on excellent goals and I am reluctant to have them ignored for whatever reasons the District Council or contractors may cite. I am unwilling to accept the excuse that I frequently hear when I question compliance with the CBA's apprentice ratio: that apprentices are unreliable or unwilling to work hard. 16
the business agent to the likelihood that the Carpenter's entitlement to be listed on the OWL is suspect. A shop steward who testified about the routine, sudden conversion of employed "company" men into "union" men testified that no business agent ever criticized his enforcement of the 50/50 rule as reflected in his shop steward reports. (Mitchell Deposition at 32-33, 128, 157.) I really do not blame the business agents or the shop stewards for their reluctance to enforce vigorously the system as currently implemented because that system is simply a paper chase which, if followed by the contractor, allows him to hand-select the journeymen who are assigned to his job site without any risk of running afoul of the 50/50 rule as it currently operates. In fact, on at least one occasion the union demonstrated its own inclination to be complicit in this deceptive practice. And in recounting this incident, I do not mean to be unfairly critical of a hard-working business agent who, along with other of his colleagues, has questioned the system as it currently operates. This business agent testified about his Local's attempt to address the discovery (which I made after receiving a hotline complaint) that a shop steward had wholly failed to enforce the 50/50 rule on a job site. He testified that his superiors at the Local pressured him to rectify the situation not just by getting the contractor to hire more Carpenters from the OWL, but also by having Carpenters already on the job put their names on the list and then have the company request thern. Ultimately, after it was clear that I was aware of the problem with the shop 17
steward reports, the direction to orchestrate belated requests was rescinded. (Firth Deposition at 189-93.) The only defense of the present system I heard that seemed to entail some benefit to the membership as a whole is the assertion that the request system was negotiated for by the contractors' associations which, in turn, agreed to higher wages and better benefits for Carpenters. Because I have limited my investigation to describing the system as it currently operates, I leave it to the Court and the parties to determine whether this bargain was appropriate or whether it improperly compromised the 50/50 rule and the OWL system. HI. Non-Compliance With the Terms of the International Agreement The National United Brotherhood of Carpenters and Joiners have "International Agreements" with contractors who do business away from their home areas. Many of the contractors who are parties to an association's CBA also are parties to International Agreements despite the fact that they conduct the bulk if not all of their work in New York City.' Because an International Agreement typically permits a company to bring to a job two "key" traveling employees from its home area, without having to hire a shop steward, many of these association contractors elect to invoke the International Agreement in order to avoid being assigned a shop steward (normally required once two Carpenters are on a job) until they need a third carpenter. 15 It is not at all clear to me why this is permitted and I believe that the District Council may currently be challenging the rationale and wisdom of this practice. 18
The International Agreements (a model of which is submitted herewith as Exhibit 17), require that fifty percent of all Carpenters hired after the two "key" employees be from the Local or the District Council where the work is performed. In New York City, fifty percent of any additional Carpenters must be taken from the OWL without resort to the request system. An additional requirement of the International Agreements is that the contractor register with the Local or the District Council in the area where the work is to be performed. This allows the District Council and/or the Local to survey the job site to make sure that the terms of the International Agreement are being complied with. As a result of calls to the Independent Investigator hotline and follow-up investigative efforts by the District Council and by Chief Investigator, Don Sobocienski, I have learned of numerous instances in which the International Agreement was invoked but neither registered nor complied with. Either there were more than two Carpenters without a shop steward, or the contractor had failed to register with the District Council, or the contractor had requested specific journeymen from the OWL despite the fact that this is not a right accorded to contractors who have chosen to operate under the International Agreement.' 16 One shop steward whom I deposed testified that he was not aware that the International Agreement does not allow the request system to be used by the contractor. (Flaherty Deposition at 57.) I question why shop stewards are not adequately informed concerning the contracts they are supposed to be enforcing. I reiterate my strongly-held view that a well-trained shop steward who is loyal to the District Council's union principles, absolutely honest and truthful, and immune to contractor enticements or temptations is the best defense against job site wrongdoing and is essential to an effective Anti-Corruption program. My upcoming reports concerning the Jacobi Medical Center and Kings County Hospital job sites will illustrate the consequences of 19
Based on information I have acquired as a result of hot line complaints and follow-up investigations, it appears to me that the business agents seemed to have been unaware of these rules and consequently, until recently, have not made efforts to curb these violations without prodding at Anti-Corruption Committee meetings. Recently, business agents have been instructed to be more vigilant with respect to enforcement of International Agreements, and it is my hope that these efforts will become more vigorous. I believe that as a result, contractors with association CBAs will no longer have any incentive to invoke an International Agreement for a job that will require more than two Carpenters to complete; the request system paperwork shuffle is too advantageous a. system for the contractor to jeopardize by invoking an International Agreement. CONCLUSION As noted above, I have not attempted in this report to track the evolution of the 50/50 and request rules into the present system, whereby contractors can count journeymen whom they request from the OWL toward the "union's" 50%. Therefore, it is not surprising to me that so many Carpenters register complaints with me that they have been out of work for months and cannot afford to even feed their families. I am sure that District Council representatives hear even more complaints of this nature. I view my function on this topic as simply reporting my observations about the |