DC 37

Vol. 8, No. 2
April, 1999



	PUBLIC SECTOR DC 37: From Disgrace to Democracy? By Joe Pilati It may take years for New York City's largest public sector union, AFSCME District Council 37, to recover from the scandal and disgrace that came into public view last year. For reformers and union democracy advocates, the removal of former executive director Stanley Hill and several other high-ranking, self-serving officials only marked the beginning of the struggle to win back DC 37 for its 120,000 members. Long before AFSCME International President Gerald McEntee imposed an administratorship over DC 37 last Nov. 30 — admitting that he wished he had intervened sooner — Manhattan District Attorney Robert Morgenthau and union "whistle blowers" had already exposed a dismal pattern of financial mismanagement, kickbacks, slush funds, embezzlement and alleged mob influence. The new administrator appointed by McEntee, Lee Saunders, immediately suspended DC 37 treasurer Robert F. Myers Jr. and dumped four local union presidents implicated in the scandals from the executive board. Stealing an Election Around the same time, Hill, in a truly shameless attempt to divert attention from himself, admitted that the ratification vote on DC 37's 1995 contact with the city had been rigged and that two of his top aides, Martin Lubin and Mark Shaplo, knew about it. Albert Diop, Hill's closest advisor and the president of the local in which the most flagrant ballot-stuffing occurred, was removed on March 4. But Hill himself claimed to be unaware of discrepancies in the two-month-long vote count. "That defied credibility," said Charles Ensley, president of a 15,000-member social service workers' local and one of only two executive board members who were longtime critics of Hill and his cronies. "Your right-hand man (Lubin) and your childhood friend (Shaplo) can be involved in rigging an election, and you can say you know nothing about it?" Hill, who was placed on unpaid leave in November when McEntee brought in Saunders, formally retired in February on a pension of more than $100,000 a year. He'll also get a "deferred compensation" payment of $243,000. A Pattern of Abuse For many DC 37 members and activists, what was most appalling about the vote-rigging scandal was that the fraudulently-approved five-year contract imposed a two-year wage freeze not just on DC 37 members, but on 180,000 other municipal workers whose contracts were patterned on it. As Carl Biers, executive director of the Brooklyn-based Association for Union Democracy, wrote in a February newsletter: "A gross abuse of democracy in one union undercut the bargaining power and wages of hundreds of thousands of workers, and dealt a crippling blow to labor's effort to cast off its image of corruption." To his credit, administrator Saunders has joined DC 37 reformers in opposing Republican Mayor Rudolph Giuliani's privatization schemes and expansion of "workfare," under which thousands of welfare recipients receive subsistence wages for doing tasks once done by full-time city workers. On Feb. 4, the union sued the Giuliani administration, accusing it of violating state law. The Mayor and the Betrayer This represented a reversal of Stanley Hill's position both before and after the rigged contract vote. As Ensley told The New York Times, "Stanley acted more like the mayor's agent than the workers' representative." (In fact, Hill was more than just accommodating to the widely-disliked mayor; he actually raised hundreds of thousands of dollars for him and even hosted a fund-raising breakfast at union headquarters.) Other noteworthy actions by Saunders since he began running the union in December include: • Hiring an accounting firm (KMPG Peat Marwick) to audit the books of all 56 locals and another private firm (Kroll Associates) to investigate fraud in the 1995 contract vote. • Appointing two leading reformers, Ray Markey and Roy Commer, to a new Laws and Rules Committee set up to hear from members who suspect abuses and to establish a code of ethical practices for DC 37's constitution. • Creating a member hotline for those who want to report problems within their locals. • Announcing "a significant win" in a Feb. 25 election in which DC 37 won the right to represent 108 computer workers at a private firm which has a contract with the city. After the National Labor Relations Board ruled on Jan. 27 that workers at LFI Pyramid Consulting, Inc., had the right to vote on representation, the union launched an intensive organizing drive — its first in many years — that led to a 74 to 10 (88 percent) union victory. "This sends a clear message about the new direction we're taking," Saunders said. "If the city uses public funds to privatize jobs that city workers could be doing, we're going to respond by organizing and taking legal action." A Citywide Movement On March 6, nearly 100 union members — including teachers, transit workers, teamsters and legal workers as well as members of District 37 — met to form a citywide organization "to return union power to the rank-and-file." Among them was Mark Rosenthal, a truck driver for the Parks Department who sparked the initial criminal investigation of DC 37 by bringing evidence of a $92,000 Christmas party to the attention of D.A. Morgenthau. "We're going to break the pattern of sell-out contracts for city workers," said Rosenthal, who described DC 37 under Hill's leadership as "a cesspool of corruption." Now he's in a position to do something about it — as president of his 2,300-member local, swept into office by a landslide. In the long run, many DC 37 reformers realize that if direct, supervised voting for contracts is a good thing, then direct, supervised voting for officers of DC 37 itself would be even better. They say the present governing structure — "It's a hand-picked board," says Ensley — actually fosters corruption by limiting questioning and financial oversight at the highest levels.

PUBLIC SECTOR

DC 37: From Disgrace to Democracy?

By Joe Pilati

It may take years for New York City's largest public sector union, AFSCME District Council 37, to recover from the scandal and disgrace that came into public view last year. For reformers and union democracy advocates, the removal of former executive director Stanley Hill and several other high-ranking, self-serving officials only marked the beginning of the struggle to win back DC 37 for its 120,000 members.

Long before AFSCME International President Gerald McEntee imposed an administratorship over DC 37 last Nov. 30 — admitting that he wished he had intervened sooner — Manhattan District Attorney Robert Morgenthau and union "whistle blowers" had already exposed a dismal pattern of financial mismanagement, kickbacks, slush funds, embezzlement and alleged mob influence.

The new administrator appointed by McEntee, Lee Saunders, immediately suspended DC 37 treasurer Robert F. Myers Jr. and dumped four local union presidents implicated in the scandals from the executive board.

Stealing an Election

Around the same time, Hill, in a truly shameless attempt to divert attention from himself, admitted that the ratification vote on DC 37's 1995 contact with the city had been rigged and that two of his top aides, Martin Lubin and Mark Shaplo, knew about it. Albert Diop, Hill's closest advisor and the president of the local in which the most flagrant ballot-stuffing occurred, was removed on March 4. But Hill himself claimed to be unaware of discrepancies in the two-month-long vote count.

"That defied credibility," said Charles Ensley, president of a 15,000-member social service workers' local and one of only two executive board members who were longtime critics of Hill and his cronies. "Your right-hand man (Lubin) and your childhood friend (Shaplo) can be involved in rigging an election, and you can say you know nothing about it?"

Hill, who was placed on unpaid leave in November when McEntee brought in Saunders, formally retired in February on a pension of more than $100,000 a year. He'll also get a "deferred compensation" payment of $243,000.

A Pattern of Abuse

For many DC 37 members and activists, what was most appalling about the vote-rigging scandal was that the fraudulently-approved five-year contract imposed a two-year wage freeze not just on DC 37 members, but on 180,000 other municipal workers whose contracts were patterned on it.

As Carl Biers, executive director of the Brooklyn-based Association for Union Democracy, wrote in a February newsletter: "A gross abuse of democracy in one union undercut the bargaining power and wages of hundreds of thousands of workers, and dealt a crippling blow to labor's effort to cast off its image of corruption."

To his credit, administrator Saunders has joined DC 37 reformers in opposing Republican Mayor Rudolph Giuliani's privatization schemes and expansion of "workfare," under which thousands of welfare recipients receive subsistence wages for doing tasks once done by full-time city workers. On Feb. 4, the union sued the Giuliani administration, accusing it of violating state law.

The Mayor and the Betrayer

This represented a reversal of Stanley Hill's position both before and after the rigged contract vote. As Ensley told The New York Times, "Stanley acted more like the mayor's agent than the workers' representative." (In fact, Hill was more than just accommodating to the widely-disliked mayor; he actually raised hundreds of thousands of dollars for him and even hosted a fund-raising breakfast at union headquarters.)

Other noteworthy actions by Saunders since he began running the union in December include:

• Hiring an accounting firm (KMPG Peat Marwick) to audit the books of all 56 locals and another private firm (Kroll Associates) to investigate fraud in the 1995 contract vote.

• Appointing two leading reformers, Ray Markey and Roy Commer, to a new Laws and Rules Committee set up to hear from members who suspect abuses and to establish a code of ethical practices for DC 37's constitution.

• Creating a member hotline for those who want to report problems within their locals.

• Announcing "a significant win" in a Feb. 25 election in which DC 37 won the right to represent 108 computer workers at a private firm which has a contract with the city. After the National Labor Relations Board ruled on Jan. 27 that workers at LFI Pyramid Consulting, Inc., had the right to vote on representation, the union launched an intensive organizing drive — its first in many years — that led to a 74 to 10 (88 percent) union victory.

"This sends a clear message about the new direction we're taking," Saunders said. "If the city uses public funds to privatize jobs that city workers could be doing, we're going to respond by organizing and taking legal action."

A Citywide Movement

On March 6, nearly 100 union members — including teachers, transit workers, teamsters and legal workers as well as members of District 37 — met to form a citywide organization "to return union power to the rank-and-file." Among them was Mark Rosenthal, a truck driver for the Parks Department who sparked the initial criminal investigation of DC 37 by bringing evidence of a $92,000 Christmas party to the attention of D.A. Morgenthau.

"We're going to break the pattern of sell-out contracts for city workers," said Rosenthal, who described DC 37 under Hill's leadership as "a cesspool of corruption." Now he's in a position to do something about it — as president of his 2,300-member local, swept into office by a landslide.

In the long run, many DC 37 reformers realize that if direct, supervised voting for contracts is a good thing, then direct, supervised voting for officers of DC 37 itself would be even better. They say the present governing structure — "It's a hand-picked board," says Ensley — actually fosters corruption by limiting questioning and financial oversight at the highest levels.

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