Right to Work Blog

Racing against the clock, Democrat Senate Majority Leader Harry Reid pushed through another Obama Big Labor nominee, Patricia Smith, before Senator-Elect Scott Brown becomes a Senator. Reid won this race, see the Senate votes here.

In addition, Reid is prepared to add radical SEIU & AFL-CIO lawyer, Craig Becker to the list of Obama nominees approved before Senator Brown arrives.

Please thank your Senators who voted against President Obama’s U.S. Labor Department Solicitor of Labor nominee Patricia Smith. And, urge your U.S. Senators to Vote NO on the impending Obama National Labor Relations Board nomination of Craig Becker. 

As the new U.S. Solicitor of Labor, President Obama’s nominee M. Patricia Smith will control the largest civilian pool of government lawyers after the Justice Department.

Then New York Gov. Eliot Spitzer appointed Smith Commissioner of the New York State Department of Labor (NYDOL). Having spent her entire working life as a government employee, Smith brings only bureaucratic experience to the table.

As NYDOL Commissioner, Smith used her position and federal funds to override a state hiring freeze to hire a politically connected union organizer as a state employee.

In her former NYDOL position, Smith fostered and named a program “Wage Watch” that created a direct and integral relationship between NYDOL government enforcement agents and the “program’s partners” who are Big Labor organizers and Big Labor front groups.

Then NYDOL Director of Strategic Enforcement and recently withdrawn Obama DOL Wage and Hour appointee, Lorelei Boylan referred to these Big Labor partners as NYDOL “community enforcers.”

In one giddy e-mail obtained by NRTW, Boylan wrote, “the ‘role of the commuity [sic] enforcer’ is where we will have to come up with original material.”

For a real world example of how this works let us take you back to the Clinton Administration’s Labor Department which colluded with Service Employees International Union (SEIU) organizers in an attempt to shakedown an employer to extract an agreement to hand his employees over to labor bosses. Watch the National Right To Work Committee’s interview with Randy Schaber (Link) and read the congressional investigative report (Link) that caused the firing of a Clinton appointee at the Labor Department in the 1990s.

It is past time to stop these political favors and manipulations of federal resources and laws to benefit Big Labor Bosses. And, that is exactly what we can expect with Smith’s confirmation as Solicitor of Labor. She did it in New York, and now she plans to do it across the USA.

ACT NOW, thank your senators who voted against Smith and encourage your senators to vote against Big Labor Lawyer Craig Becker’s nomination to the NLRB.

The Committee was forwarded an e-mail that, in part, read:

We have just learned from our contacts in Washington that the HELP committee [U.S. Senate Committee on Health, Education, Labor, and Pensions] has postponed other scheduled business and will conduct a hearing on the [Craig] Becker [National Labor Relations Board] nomination next Tuesday at 4 p.m.

– Martin F. Payson

The National Right to Work Committee (NRTWC) released its first Obama Personnel Alert of 2010 exposing the ongoing failure of President Obama’s ethics pledge and executive order as it relates to ethics and transparency in his administration.  According to NRTWC research, Labor Secretary Hilda Solis and several other top-level political appointees at Department of Labor (DOL) made up their own rules ignoring the President’s ethics executive order.

Assistant Secretary Phyllis Borzi, Assistant Secretary Michael Kerr, and Assistant Secretary Jane Oates are other known DOL appointees who gave themselves ethics waivers.  Without public disclosure of the ethics pledges, it is impossible to determine if this self-administering of ethics waivers is Department-wide or even Obama Administration-wide.

Big Labor DOL insiders gave themselves personal exemptions from President Obama’s January 21, 2009 ethics Executive Order 13490 two-year ban from activity on behalf of former

Obama has filled DOL with Big Labor operatives and former union officials, and these insiders have wasted little time rolling back financial disclosure for union bosses, handing out multimillion dollar grants and contracts to Big Labor, and turning DOL enforcement into an arm of Big Labor’s forced-unionism organizing machine.

Top DOL officials have at least made a mockery of and worst completely violated the President’s executive order by cutting in half Obama’s ordered two-year moratorium.  It appears that the President has already lost control of the union operatives inside his own Administration.  But what can Obama do when he owes so much to Big Labor Bosses and the forced union dues they anted up for his election?

Congress and the Justice Department ought to investigate the Office of Government Ethics failure to enforce the Ethics Executive Order 13490 documented violations.

With all that is disclosed in the NRTWC report, there should be increasing pressure for Congress to investigate the Obama Administration’s repeal of several financial disclosures that include the proposed repealing of conflict-of-interest disclosures for Big Labor officials.

It looks like the Labor Department is the tail wagging the Administration dog.

NRTWC OBAMA ADMINISTRATION PERSONNEL ALERT: U.S. Labor Secretary Hilda Lucia Solis –

As 2009 fades away, President Obama has decided to let disclosure of hundreds of millions of dollars in forced-union-dues disclosure fade away too. Under current law and regulations valid until December 30th, union bosses were supposed to carefully document the billions of dollars they extract from workers as a condition of employment that they in turn pour into front groups and other “funds” each year.

A large part of the billions were about to be made public and reported on a Department of Labor disclosure form known as the Form T-1 Annual Report. But, that won’t happen now!

According to Bureau of National Affairs, Inc, “The Labor Department is issuing a final rule that extends for one year the deadlines for unions to file Form T-1 Trust Annual Report Reports.”

After allowing only 11 days of comments from the public, the Obama Administration postponed requiring reports for another year. During 2010, the Obama Administration states that it intends to completely eliminate the financial disclosure.

Again, the Obama Administration is blatantly paying back union bosses at the expense of rank-and-file workers.

Representing a state with a popular Right to Work law that protects a workers’ right to choose whether to join or support a  labor union sometimes makes it tough to pay back your pro forced unionism political backers but in the case of North Dakota congressman Earl Pomeroy he is working hard to find a way.  Pomeroy has a plan to bailout Big Labor pension plans by saddling all employers who are forced by federal fiat to participate in financially troubled union run pensions to become responsible for other unrelated union boss controlled pensions. Pomeroy’s bill appears simultaneously with the federal government’s aggressive drive to force employers of  non-union workers on federal construction projects to contribute to union pensions as a condition of their employment (Link our blog on other WT article).

This misguided legislation will force employers to become liable for any mismanaged union pensions, even ones utterly unrelated to the employer’s workers.  This bill presents an unascertainable risk assessment for every employer and their employees.   This kind of unrelated burden transfer will make the cost of doing business incalculable and inevitably will cost every worker.  Washington Times contributors Vernuccio and Lott wrote:

Rep. Earl Pomeroy, North Dakota Democrat, is drafting legislation that would amount to a massive, employer-crippling bailout for struggling union pensions. The congressman is trying to spin this as a cheap, proactive way to shore up said pensions. He claims that his bill is a response to an “urgent plea [from employers] for manageable and predictable pension funding rules as the nation works [its] way back to recovery.”

In reality, the bill as currently drafted would be a costly sop to unions, which have done so much to get Mr. Pomeroy elected. (Twelve out of his top 21 donors are unions, according to opensecrets.org.) It would allow the unions, which have badly mismanaged pension funds in the past, to make new companies liable for the pension obligations of workers at other companies, in other industries. It also would create an explicit taxpayer guarantee if it all comes crashing down.

The devil is in the details of the draft, the text of which can be found on the congressman’s Web site. The changes it introduces are chilling.

The draft would allow union-controlled multiemployer pension plans to form alliances with one another. It also would create something known as a fifth fund that the Pension Benefit Guarantee Corp., with taxpayer help, would use to prop up failing union pension plans.

Multiemployer union pension alliances might sound innocent enough, but consider what that actually means. Moody’s Investors Service recently warned of a vast underfunding problem with multiemployer pensions. Many employers fear being shackled into them. Even though the funds are controlled by unions, employers are liable not just for their own employees, but for every worker in the plan regardless of how the plan is managed or mismanaged.

The so-called last-man-standing rule holds that if every other company in a multiemployer pension plan goes bankrupt, closes or pulls out of the plan, the one survivor is responsible for every single employee covered by the plan, even those who never worked for him. UPS paid $6.1 billion in withdrawal fees just to escape the Teamsters Central States pension fund.

Earlier this year the Teamsters were required to send out a letter to participants of the Central States pension alerting them that the plan was in “critical status” – funded at 65 percent or less.

The current multiemployer scheme may be bad, but at least employers know the liabilities cover just the workers in one industry in one plan. The Pomeroy bill would change that. It would take current vague, vast and dangerous liabilities and multiply them by, well, pick a number. Concrete makers in Ohio could be held responsible for the pensions of garment workers in California. Hotels in Oregon could be on the hook for truckers in Pennsylvania.

All past employers and all future employers would be liable for every employee who ever was in one of their plans and potentially any plan that would ally with it. This could add billions in pension liabilities to these companies and bankrupt even healthy businesses.

Right now, when pension plans fail, the Pension Benefit Guarantee Corp. steps in. PBGC is an independent government-created entity, like Fannie Mae and Freddie Mac, that insures pension plans through private premiums. Its ability to cover losses is real but limited. If a multiemployer plan becomes insolvent, the most PBGC will cover per pensioner is $12,870 annually.

Millions of American buy stocks and mutual funds in their IRA’s but if the bosses at the AFL-CIO have their way, less money will go toward your retirement and more will be diverted to the government.  That’s because big labor is now pushing a stock transaction tax that will take between $50 and $100 billion from Americans and put them toward big government spending programs.  

What does this have to do with workers?

After helping bankrupt the state of California, SEIU is preparing its members to strike over the state’s effort to balance its books.  Incredibly, their contract with the state specifically prohibits such action but union bosses claim the contract is unenforceable.

The Wall Street Journal reports that union pension plans are underfunded while plans for the bosses and management of the unions itself are in better financial position:

We’ve all read about underfunded corporate pensions, but here’s an unreported story: Union pensions are even more in the red, and it’s one reason union chiefs are so eager to rig organizing rules to gain more dues-paying members.

Only last week, the country’s largest union local re-opened the contract for its 145,000 members two years early and gave up raises and reduced retirement benefits for future hires. The SEIU’s United Healthcare Workers East struck this unusual deal so employers could instead plug a gaping pension hole.

In April, the SEIU National Industry Pension Fund—which covers some 101,000 rank-and-file members—announced that its pension has been put into what the feds call “critical status,” or “red zone.” In other words, it lacks the cash to pay promised benefits and may have to cut them. As of 2007, the last year for which it reported results to the government, the fund had 74.4% of the assets needed to pay its benefits.

Thirteen of the bigger plans operated for the Teamsters have, together, a mere 59.3% of reserves necessary to cover obligations. Or consider that 26 pension funds at the food workers union, the UFCW, are at 58.7%. Seven locals at the United Brotherhood of Carpenters fare better at 67%. As a rule of thumb the government considers a fund to be “endangered” at below 80%, and in “critical” status at below 65%, and requires them to come up with a plan to get off probation within a decade.

You don’t hear labor leaders touting this kind of performance in their organizing riffs, and not many workers are patient enough to review the Form 5500 filings submitted to the IRS and Department of Labor that track these retirement savings. But the data show a steady decline in recent years that can’t be explained merely by the stock market.

For example, Unite HERE’s National Retirement Fund stood at 115% in 1998 and dropped to 83.4% by 2007, well before the crash. The SEIU fund that was put into a “red zone” in April was at 103.4% as recently as 1998. On average, the asset to liability ration at so-called multi-employer plans, which union funds make up the bulk of, stood at 66% in 2006, according to the Pension Benefit Guaranty Corporation. By contrast, single employer plans, basically most company-provided pensions, were funded at 96%.

Poor management probably deserves a lot of the blame for the union decline, but the exact causes are a mystery. An even bigger mystery is that the unions do a far better job with funds created for their officers and employees than for mere workers. The SEIU Affiliates, Officers and Employees Pension Plan—which covers the staff and bosses at its locals—was funded as of 2007 at 102.2%. The plan for the folks at SEIU international headquarters was funded at 84.8%.

Union officer benefits are also far more generous than anything dues-paying workers enjoy. Consider again the SEIU, probably the country’s most powerful union. Their officers and employees get a yearly 3% cost of living increase, but SEIU members get none; officers qualify for an early pension at 50 or after more than 30 years of service, but workers can’t retire early with a pension; officers qualify for disability retirement after a year’s service, but workers need 10 years. In the land of union retirement, some workers are more equal than others.

We suspect most current union members would be surprised to learn how their leaders are handling their hard-earned retirement money. The 93% of the private workforce that doesn’t belong to a union, but that might have little choice if Big Labor’s agenda becomes law, would be even more interested.

CORRECTION

Our blog noting ABC’s Ben Brubeck’s blog on a Vegas union’s pension seems to have come from false statements by the union’s spokesman.  According to the update and correction: 

Laborers chief Tommy White wants to make one thing perfectly clear: His union would like to build Las Vegas a new city hall — but not with nearly $80 million from the local’s pension fund, as one of his deputies told the Sun last week.

That deputy, Tom Morley, has been suspended for “speaking out of turn,” White said.Morley, who makes $104,000 a year as political director and spokesman for Laborers Local 872, told the newspaper the union had voted unanimously to use its pension fund to finance up to half the cost of a proposed city hall. City officials estimate the project’s price tag at $157 million, meaning the union would have put up nearly a quarter of its pension fund.

The Examiner has reported that big labor’s pension plans are underfunded understands that the Forced Unionism Card Check Bill is an effort to force subsidization of these failing plans:

Private firms could be required to save underfunded union pension plans even if doing so reduces profits and jeopardizes the retirement savings of non-union workers. That’s the consequence of a binding arbitration provision in a proposal now before Congress. The provision is included in the horribly misnamed Employee Free Choice Act (aka Card Check) and may actually be the primary driving force behind the measure, which is described by labor bosses as their top legislative priority for 2009. Card Check abolishes secret balloting voting for employees in workplace representation elections, and mandates that federal arbitrators impose settlements when a company fails to reach an agreement with a newly recognized union within 120 days.

Card Check would not bar federal arbitrators from forcing companies into union-negotiated multi-employer pension plans, many of which are severely underfunded and staggering under steadily increasing rising liabilities. Pensions for nearly half of the nation’s 20 largest unions are classified as either “endangered” or in “critical” condition due to underfunding, according to federal actuarial reports. Pensions with less than 80 percent of the assets needed to cover present and projected liabilities are considered “endangered,” while those below 65 percent are classified as “critical” under the Pension Protection Act of 2006. The average union pension has resources to cover only 62 percent of what is owed to participants, according to the government-backed Pension Benefit Guarantee Corp. (PBGC). Less than one in 160 workers is presently covered by a properly funded union pension plan. Failed pension plans are bailed out by the PBGC.

But opposition to abolishing the secret ballot in the workplace is growing steadily, forcing Card Check backers to seek a legislative compromise with opponents. But if the compromise includes the mandatory arbitration provision, unions, particularly those with sickly pension plans, will be tempted to resist settling with a company, knowing that federal arbitrators will likely impose a settlement that is more to their liking, according to Ted Phlegar, senior counsel to the Workforce Freedom Initiative. “Unions are pushing this bill because they need members and they need the contributions as many of these funds are underwater. This is one way to save them,” Phlegar said. “In fact, this may have been the goal all along.” In other words, a Card Check compromise that includes mandatory arbitration would give unions that inadequately funded their pension plans a backdoor way to get a bailout, paid for either by the company or the tax payers.