A former president and business manager of the International Union of Operating Engineers, Local 904, in this province has asked the provincial government to amend the Labour Relations Act to prevent improper takeovers of union locals by their international bodies.
John Flaherty says that’s what happened to his local.
On March 20 of this year he says he was ousted from his position with the local by the union’s international general president — James T. Callahan — in Washington, D.C. The international office then seized control of the assets of Local 904 worth an estimated $253 million — $53 million in bank accounts and investments and $200 in its pension fund, he said.
Flaherty has written Premier Dwight Ball and, along with other former members of his management team, have compiled a large number of documents they claim supports their reasons for better legislative protection.
“Local 904 was placed under supervision based on factually incorrect information and is now controlled by International,” the letter to Ball reads. “Local 904, its elected officers, nor the membership were provided a fair and unbiased hearing.”
The Telegram contacted the premier’s office and the matter was referred to the Department of Advanced Education, Skills and Labour. A statement from that department reads: “The request to amend the legislation is being reviewed. A jurisdictional scan is being conducted and all information is being assessed.”
Local 904 represents about 2,300 members in Newfoundland and Labrador including heavy equipment operators, mobile and crane operators, mechanics and clerical workers.
Documents received by The Telegram state that Flaherty was elected president and business manager by union membership in July 2016. On March 20 of this year, Callahan placed Local 904 under emergency supervision citing financial malpractice and political in-fighting among the reasons.
Flaherty was fired, as well as the local's executive assistant/office manager, two business agents and the local's executive board pending the outcome of an internal hearing to determine whether full supervision of Local 904 was warranted.
In June, the parent union conducted a hearing in St. John’s to determine whether Local 904 should remain under emergency supervision or have local autonomy restored, or be placed under what is called regular supervision. A three-member hearing panel recommended in a report that supervision be maintained. Reasons cited in the report include allegations of financial malpractice, political in-fighting, questions surrounding the handling of termination of employees and severance, and issues regarding membership applications and pension.
Flaherty refutes the reasons provided by the international and says documents they have compiled tell the real story. He believes a fair, independent hearing by the province’s Labour Relations Board would have come to the same conclusion.
Flaherty was ousted five days before the local's scheduled annual general meeting (ADM) during which Flaherty says he intended to deliver the results of an external audit he had called for after he became head of the local, as well as the results of a forensic audit.
Flaherty said also he intended to present the findings of two independent assessments of the union-run Operating Engineers College in Holyrood. The college runs programs to train heavy equipment and mobile crane operators. The assessments reportedly found “serious structural issues” that could compromise the integrity of the facility in the future, equipment problems, as well as mold problems.
After Flaherty’s firing, the AGM was cancelled.
Flaherty said he contacted the province’s Labour Relations Board but was told there was nothing the board could do in the case.
In a news release issued by Flaherty recently, it explains that once a union local is placed under supervision, the local membership does not have democratic authority, financial management or oversight of the local.
“Most, if not all, of the 16 trade unions in our province are headquartered by parent unions in the United States and are governed by the international's constitution,” Flaherty said. “There is currently no process for a local union, its officers, or its membership to access a fair and unbiased hearing in the event the international decides to impose supervision upon a local. The general president of the parent union has absolute control over all of the local’s finances, assets, contracts and bargaining authority. It has control of the dispatch and filters what information, if any, is given to the membership.”
Flaherty says the other 15 trade unions in the province have built up assets of similar value and are also vulnerable to takeover and seizure of these assets by their parent unions. He said legislative changes are needed to ensure the assets remain in the province and under the control of the local.
“There is absolutely nothing to stop any other international from doing the same,” Flaherty said. “Collectively, the international unions have control of as much as $4 billion in the economy of Newfoundland and Labrador without any oversight protection.”