INTERIM REPORT OF
THE INVESTIGATIONS AND REVIEW OFFICER

Pursuant to paragraph 4(k) of the Consent Decree entered in the above-captioned case (attached hereto as Exhibit 1), the Investigations and Review Officer ("IRO") of the District Council of New York City and Vicinity of the United Brotherhood of Carpenters and Joiners of America ("District Council") is required to file periodic reports, at six-month intervals, on his activities. This interim report sets forth the activities of the IRO during the first six-month period of supervision of the District Council.1

1 This report actually covers the first seven months of the IRO's term (March-September 1994). Its filing was adjourned, with the consent of the parties and with leave of the Court, so that the sections of the report on matters concerning the Jacob K. Javits Convention Center ("Javits Center") would include certain activities which occurred in the month of September 1994.

Job Referral Rules

One of the IRO's chief responsibilities under the Consent Decree is to supervise the implementation of the job referral rules by the local unions.

The goal of achieving comprehensive fairness in job referrals, for tens of thousands of members, in sixteen local unions, covering a large and diverse metropolitan area, involving general and specific skill qualifications, work history and job duration, and specialized job requirements of hundreds of contractors, is a complex undertaking. The job referral rules were intended to eliminate the corruption, favoritism and cronyism that existed under the old system. Under the new rules, union members are to be referred work on the basis of length of unemployment, not on the basis of union politics or patronage. It is improper under the rules for an officer to refer work to a union member as a way of rewarding the member for his or her political support or other union activity. It is also improper under the rules for an officer to refuse to refer work to a union member as a way of punishing him for his union activity. In addition, union members may not be denied job referrals on the basis of race, gender,- age, national origin, sexual orientation, disability or religion.

According to the terms of the Consent Decree, the job referral rules were to be implemented within thirty days of the filing of the Consent Decree. Consequently, my staff and the officers of the local unions needed to become familiar with the rules in a relatively short period of time. The task of

implementing the new rules was complicated by the fact that the local unions apparently had not participated in drafting the rules and were not familiar with them prior to the entry of the Consent Decree. Furthermore, numerous issues had to be addressed in order to ensure that the new job referral rules would operate fairly and efficiently.

Our first task in implementing the job referral rules was to better understand the context in which the local union officers who refer jobs operate, and to become familiar with potential obstacles to the application of the rules. In order to do this, members of my staff attended local union meetings, visited local union offices and fielded a variety of telephone and letter inquiries from local union members regarding the application of the rules.

Even before the implementation date arrived, we identified a number of issues and potential problems about which the local unions needed guidance. In some cases the rules -- which were meant to serve as a general framework -- did not directly address these issues. In other instances, the rules imposed practices that were not sufficiently sensitive to legitimate union needs -- needs that are consistent with the objectives of the Consent Decree. In a few instances the rules impose practices that had an adverse impact on local unions with unique conditions or problems.

In order to anticipate some of these issues and problems, IRO Decision No. 1 (attached hereto as Exhibit 6) was issued

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immediately prior to the implementation of the job referral rules. Since there was no provision in the job referral rules governing how the out-of-work list would be ordered initially -- and a first come, first served basis was arbitrary and susceptible to abuse -IRO Decision No. 1 provided that the initial list should be organized in reverse order of the last-date-worked. See Exhibit 6, IRO Decision No. 1, at 1-2. In this way, those carpenters who had been out of work the longest would be the first to receive a job referral.

Although it no longer appears to hold to this position, when IRO Decision No. 1 was released, the District Council initially argued that the IRO had no authority to issue decisions relating to the implementation of the job referral rules. The District Council continues to oppose the first section of that decision which requires the out-of-work list to be ordered initially by the date each carpenter last worked. It directed even those local unions which had already ordered their lists in accord with IRO Decision No. 1 to adopt the less equitable first come, first served method preferred by the District Council. As of last month it appears that there are at least several local unions that continue to rely on out-of-work lists in which the remaining names from the original list still have not been reordered in accord with IRO Decision No.1.4

4 It appears that in most local unions, every individual on the original list has by now received at least one work assignment and has reregistered on the list. Since those lists have already been reordered through this process in a manner approximating the date last worked, the manner in which these lists were initially ordered

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Local unions that had been accustomed to using "shape halls," where union members assemble at the union hall each morning for work assignments, requested the IRO to accommodate this practice in a manner consistent with the objectives of the job referral rules. In response, IRO Decision No. 1 gave local unions the option of using a modified shape hall referral system instead of the phone notification system. See Exhibit 6, IRO Decision No. 1, at 2. Under this option, the top 100 individuals on the out-of-work list are notified by postcard that they must appear at the local union hall the following Monday morning if they wish to participate in the job referral process.5 We believed that this option, in addition to accommodating local unions that had traditionally used shape halls, would encourage efforts at self-policing by providing local union members with the opportunity to observe the job referral process as it occurs.

IRO Decision No. 1 also preserved another local union option. Prior to the implementation of the job referral rules,

is no longer an issue in these local unions. However, there are, as of the writing of this report, still carpenters on original lists at some local unions who have not yet received work. The lists in these local unions remain affected by the inequities of the "first come, first served system" which the District Council pressured the local unions into using. The District Council has refused voluntarily to provide employment information to which the District Council has access that would enable these local unions to reorder the remaining portion of the original list. The District Council believes that the IRO must proceed by subpoena to gain access to this information, contained in benefit and pension fund records, and so informed one of my staff attorneys who was denied access to such records at the District Council.

5 At one local union we have approved the use of variations in the number of individuals called to the shape hall in order to reflect current levels of demand.

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Local Union 608 had given its members the option of presenting job referral disputes to an impartial umpire. IRO Decision No. 1 permitted all local unions to use this option as long as the umpire was approved by the IRO. See Exhibit 6, IRO Decision No. 1, at 4-5.

Other issues addressed in IRO Decision No. 1 related to requests for women and minority carpenters and the selection of job stewards. These issues had not been addressed in the original job

referral rules. With regard to the first issue, IRO Decision No. 1 provided that when lawful requests for women or minority carpenters could not be accommodated by referring the next qualified individuals on the out-of-work list to the job, the referring union official could skip to the next qualified minority or woman carpenter on the list. See Exhibit 6, IRO Decision No. 1, at 4-5.

Prior to the issuance of the Consent Decree and the job referral rules, the selection of shop stewards was exclusively within the discretion of the local union business representative. Even after the implementation of the job referral rules, a significant number of business representatives continued to assert that they could select a shop steward without regard to the selected person's position on the out-of-work list. Because continuation of this practice would have been inconsistent with the job referral rules and sanctioned a method for referring jobs to

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favored members,6 IRO Decision No. 1 directed business representatives to select a shop steward from among the individuals referred to the particular job. See Exhibit 6, IRO Decision No. 1 at 5. If no one to be referred was qualified to serve as a shop steward, the business representative could then refer the next qualified person on the list as steward. Exactly what qualifies a person to serve as a shop steward has not been completely resolved. IRO Decision No. 1 provides that the IRO may require local union officials to demonstrate that an individual selected as shop steward is qualified.7 Id.

Finally, IRO Decision No. 1 required local officials to monitor, record and post out-of-order referrals and to sign certain reports. See Exhibit 6, IRO Decision No. 1, at 7. This was necessary in order to carefully administer and monitor the use of the limited exceptions that could justify deviation from the list-priority basis established by the job referral rules.

After the new rules were put into effect, it became clear that additional issues needed to be addressed. On June 7, 1994, therefore, IRO Decision No. 3 (attached hereto as Exhibit 7) was issued.   This Decision dealt chiefly with the problems of

6   This office had received complaints regarding favoritism
in the selection of shop stewards.

7 After the release of IRO Decision No. 1 on March 30, 1994, President Devine announced the creation of a "shop steward training course" and stated that he intended to send every carpenter in the District Council's jurisdiction through the program. We have received complaints, however, indicating that at certain locals members in favor with the local leadership were sent to these training sessions before other members, and that the few programs that were conducted were poorly organized.

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geographically dispersed local jurisdictions, short-term jobs, and illness or disability.

Some members at local unions with very large geographical jurisdictions -- such as the millwrights in Local Union 740, the dockbuilders in Local 1456, and the timbermen in Local Union 1536 -- complained that they were unfairly discriminated against when they were offered a job that required them, in some instances, to travel over 100 miles from their homes. They expressed concern that if they refused two such jobs they would be dropped to the bottom of the out-of-work list by virtue of the provisions of the job referral rules. After consultation with members and officials of these local unions, as well as with the District Council, a new rule was promulgated which provided that, although jobs would be offered in the normal sequence of the out-of-work list without regard to their geographic location, an individual on the list could refuse a referral to a job located thirty-five miles or more from his residence without such a refusal jeopardizing the member's place on the job referral list. See Exhibit 7, IRO Decision No. 3, at 1-2.

One problem identified in the first two months of the implementation of the rules was the impact of what came to be known as the "four-day rule" established in Rule 5(c). See Job Referral Rules at 3 attached hereto as Exhibit 8. This rule stipulated that the acceptance of "short-term" job assignments would not affect an individual's position on the out-of-work list. The rule defined a short-term job assignment as one that lasts four days or less.

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In local unions where relatively few jobs were being referred each week, a considerable number of individuals on the out-of-work list expressed an unwillingness to accept short-term work. According to our discussions with union members and reports from local union officers, these carpenters feared that if they accepted a referral to a job that lasted only slightly longer than four days they would be forced to the bottom of the list and miss the opportunity for longer term employment. These carpenters would use their first "free" refusal to reject short-term work. As a consequence, business representatives in these local unions began having trouble finding carpenters in a timely manner who were willing to do short-term work. In another, more extreme response to this rule, union members would simply walk off the job after the fourth day. This latter practice was consistent with anecdotal evidence received from contractors about their experience in other jurisdictions operating under a similar rule.

When it became clear that this problem was affecting a significant number of local unions, it appeared that the simplest way to adjust for this unintended disincentive to the acceptance of short-term job was to expand the number of days a member could work in short-term employment without affecting his or her place on the job referral list. IRO Decision No. 3, therefore, increased "short term" work from four to eleven days and, rather than regarding any one job as a short-term job, provided that short-term work should be totalled cumulatively. See Exhibit 7, IRO Decision No. 3, at 2- 3. We have received no complaints about short-term work since the

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issuance of IRO Decision No. 3, and it appears that the immediate problem may have been resolved. Although an eleven-cumulative-day rule may better reflect actual working conditions, such a rule requires additional reporting and monitoring, tasks which the local unions often perform poorly, as discussed below.

IRO Decision No. 3 also specified that when an individual on the list provided timely documentation of an illness or disability, his or her position on the out-of-work list would be "frozen" until the disability or illness ended. See Exhibit 7, IRO Decision No. at 4-5. The Decision also described the documentation required for a contractor's requests for specific members, defined the meaning of the requirement that job referral lists be "conspicuously posted" at the local unions, and established a policy for the publication of future IRO Decisions. Id. at 5.

Perhaps the major job referral issue which has not yet been addressed is the "hardship" issue. Prior to implementation of the job referral rules, many local unions permitted referral preferences for members who faced extraordinary hardships, usually related to a serious illness in a member's immediate family. The objective of the preference was to insure that the member was given enough work to continue to maintain health insurance benefits. This preference was also occasionally applied in cases of severe economic hardship, where an individual member needed to qualify for unemployment benefits, for example.

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There is no provision for hardship exceptions under the current job referral rules, largely because -- as we are led to understand -- this practice was frequently abused and often used to give preferred treatment to favored members who were not, in fact, experiencing genuine personal hardships. The problem of potential abuse, however, should not obscure the fact that legitimate hardship problems exist in the union. One of the root causes of the problem appears to be the fact that a relatively high number of hours worked on a rolling-year basis -- 900 -- are required to maintain health insurance. One obvious way of addressing this problem would be to provide increasingly greater coverage at various employment levels (e.g., 300, 600, 900).8

During the first three months of my supervision of the union, members of my staff received dozens of phone calls from local union officers requesting guidance on specific job referral issues, and also from members asking questions about how the rules function or complaining about violations of the job referral rules. Rather than issuing formal decisions pursuant to paragraph 4(h) of the Consent Decree, members of the IRO staff generally resolved issues of this sort informally through separate discussions with local union officials and members. "Deficiency" letters were sent

___________________
   8   President Devine has publicly committed himself to adopting this "tiered coverage" approach by January 1995. See Exhibit 9, March/April 1994 issue of The Carpenter. Although the precise extent of the hardship problem is unclear, if tiered coverage is not instituted it appears that there may be many working carpenters who will have difficulty in accumulating the hours they need to qualify for health coverage.

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to certain local unions, directing them to bring their practices into compliance with the job referral rules.

Calls to this office regarding the job referral rules have decreased dramatically since June 1994. There are perhaps a number of reasons for this. One reason is that demand for carpenters, at least in the Manhattan local unions, seems to have increased. Because a rising tide lifts all boats, as more jobs are available, less pressure is placed on the job referral system at the locals. Another reason is that the work list is circulating at a faster pace. It is also possible that local union members and officers, having become more familiar with the job referral rules and the procedure that the rules are designed to create, no longer need to seek clarification and guidance.

After five months of experience with the job referral rules, we have concluded that the rules are generally being followed most of the time. Anonymous communications and anecdotal evidence, however, point to the existence in certain local unions of a parallel "informal" system, in which referrals are made to favored members in violation of the formal system.

The informal system appears to operate in a number of ways. Better jobs (i.e., jobs of longer duration or jobs in more favorable working circumstances) may be "pocketed" by local union officers who hold them for assignment to friends and political allies. "Inside information" about jobs may also be leaked to favored members who then report that they "found" the job on their own. In another form of abuse, a local union officer arranges for

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a contractor to "request" the officer's political allies and supporters. We have also become aware that certain members go from job to job in rapid succession without ever appearing on the local's out-of-work list.

Since local union officials are now aware -- or should be aware of the requirements of the job referral rules, the "initial" period if familiarization is at an end. In appropriate cases, future abuses will be addressed formally and may result in the initiation of disciplinary proceedings.

An ongoing investigation of Local Union 17 has revealed an egregious failure on the part of certain of its officers to have even familiarized themselves with the requirements of the job referral rules or the two Decisions that I promulgated relevant to the job referral rules. The business manager and other officers of Local Union 17 have been required to give sworn testimony on these matters. President Devine has, in effect, conceded that Local Union 17 had not complied with its obligations with respect to the job referral rules. On July 27, 1994, after having been prompted by this office to do so, President Devine dispatched a representative of the District Council to bring Local Union 17 into compliance with the job referral rules. See Letter of Frederick W. Devine, dated July 27, 1994, attached hereto as Exhibit 10. In a letter dated August 19, 1994 (attached hereto as Exhibit 11), President Devine informed me that his representative had carried out his assignment and that Local Union 17 was in compliance. However, the reliability of this announcement is called into

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question by the steady stream of reports to my office of violations of the job referral rules in Local Union 17, even after the District Council's intervention.9

Investigation of non-compliance with the job referral rules by the other local unions is ongoing. Two investigations into systematic job referral abuses have begun and others will likely be initiated in the near future. For example, reports of out-of-order referrals and widespread favoritism in the distribution of work at one of the Manhattan-based local unions are presently being investigated. The local unions have been and will continue to be monitored by my staff through unannounced inspections, and by the rank and file, who have been encouraged to report perceived violations of the job referral rules to this office.

Investigation of potential job referral abuses has been hampered by the general culture of the union. Very few union members with direct evidence are willing to cooperate with the IRO. Many union members apparently believe that cooperation will bring swift economic retaliation by local union officers. Even in instances in which we have concluded that it is probable that

9 This office is also investigating certain officers of Local Union 17 in regard to other conduct detrimental to the interests of its members. In addition, accusations made by these officers against each other are being investigated. I have also requested the resignation of one of the business representatives after he testified in a deposition that he was not a citizen of the United States, and was thus ineligible to hold his position under § 31(D) of the Constitution of the UBCJA, as amended January 1, 1994. The credentials of this business agent were formally removed by President Devine on September 19, 1994.

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retaliation has already occurred, union members are still unwilling to come forward. As a consequence, we have had to rely on more laborious, more time-consuming and less effective investigative techniques, such as following up on anonymous tips and second-hand accounts, and analyzing job referral records maintained by local unions.

Another problem that poses an obstacle to the investigation of job referral abuses is the sometimes incomplete records maintained by local unions. The failure to keep accurate records is itself, of course, a basis for disciplinary proceedings. However, we have observed that monitoring is easier in the several local unions that have at least partially automated their job referral system. We also believe that the use of a relatively simple computer system would create significant efficiencies in the performance of the local union's job referral tasks.

With the support and assistance of this office, Local Union 257 has contracted to develop a computerized system to run the job referral system using software patterned after the specifications of the job referral rules. Implementation of the system is currently scheduled for October 1994. If the system is successful, this software may eventually be used in other local unions.

Finally, we observe that the performance of the job referral function at the District Council level through a highly automated centralized system, such as the systems that are used by some branches of the union in other regions of the country, might

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1

create even greater efficiencies. First, the monitoring of a single, central system would generally be simpler than monitoring sixteen different, dispersed systems. Second, the centralization of this function would remove the ability of local union officials to manipulate job referrals directly for political or other improper purposes. The temptation to wield this power as a means of controlling the local unions will exist as long as the function is performed at the local union hall. Moreover, since local union officials now spend a disproportionate amount of their time on the essentially clerical task of job referrals, they would have more time under a centralized system to devote to developing work opportunities for their members, organizing job sites and enforcing contracts, surely more important tasks.

Of course, it may be that a centralized system will have drawbacks or inefficiencies that might outweigh its advantages. My staff is presently considering and investigating that possibility. However, even at this stage we are fairly confident that information technology can be employed to create sufficient audit trails to monitor and prevent at least a significant number of potential abuses. In the coming months we will explore further the question of whether the use of a centralized system is feasible in the New York City vicinity and how this system might function.

The Javits Center Investigation

In July 1994, I commenced an investigation of job referrals at the Javits Center, where carpenters are employed, principally, to erect and dismantle exhibitions and display booths.

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