The US federal corruption case against UAW officials and Fiat Chrysler executives continues to widen, and now the organizations themselves, the UAW and Fiat Chrysler, have been labeled co-conspirators. This backs up the original analysis by the Unifor Solidarity Network that “this is not the result of a few corrupt individuals – it is the inevitable consequence of decades of a culture of class collaboration”.

The latest revelations come from the Plea Agreement of Michael Brown, Director of Employee Relations at Fiat Chrysler from 2009 through 2016. In that position, “Michael Brown was personally involved in the negotiation and administration of the national collective bargaining agreements between” Fiat Chrysler (FCA) and the UAW, “and had authority to sign letters and agreements on behalf of FCA with the UAW. Michael Brown also represented FCA as a Co-Director of the UAW-Chrysler National Training Center (NTC).”

Bob King (former UAW President), General Holiefield, Scott Gaberding (Fiat Chrysler), Al Iacobelli (Fiat Chrysler) at the opening of 2011 negotiations.

UAW and Fiat Chrysler – Co-conspirators

The plea agreement points to a conspiracy between UAW officials, FCA executives and the UAW and FCA “to violate the Labor Management Relations Act.”

The UAW has been trying desperately to distance themselves from this scandal, by claiming it only involved some rogue officials. Their denials are shown to be self-serving lies by the fact that they allowed those “rogue” officials to retire and collect pensions instead of taking action against them. Now the UAW is named as a co-conspirator.

Greasing the Skids for Concessions

The UAW also claimed that the corruption did not have any effect on workers’ contracts. However, FCA executive Brown now admits in his plea agreement that:

Michael Brown knew that the purpose of the conspiracy to provide prohibited payments to UAW officials was to grease the skids in order to obtain benefits, advantages, and concessions in the negotiation, implementation, and administration of the collective bargaining agreements between FCA and the UAW. 

Sham Employment

Another new detail revealed in the plea agreement is that Fiat Chrysler allowed UAW officials to have friends and family members put on the payroll on sham jobs where they did no work.

From 2009 through 2015, FCA executives authorized UAW Vice President General Holiefiield, UAW Official UAW-3, and other UAW officials to offer sham employment status at the NTC to a number of their friends, family, and allies … numerous individuals were categorized as being on “special assignment” status to the NTC when, in fact, those individuals did little or no work on behalf of the NTC.

One of the UAW officials implicated is former Vice President Norwood Jewell. Jewell was allowed to retire – he announced his surprise retirement in November 2017, and remained on the job until January. NTC funds paid for a party for Jewell in 2014.

More than $30,000 was spent throwing a party in August 2014 for former UAW Vice President Norwood Jewell, The News has learned. The party included “ultra premium” liquor, strolling models who lit labor leaders’ cigars and a $3,000 tab for wine in bottles with custom labels that featured Jewell’s name.

The Detroit News also revealed that “two of Jewell’s sons are servicing representatives with the union, according to the UAW’s annual filings. Justin Jewell is paid $125,744 while Derik Jewell’s total compensation is $116,726.”

Corruption Probe Widens to Include GM

The NTC fund is the centre of the corruption scandal, because it was designed to serve as a slush fund. It was jointly administered by Al Iacobelli and General Holiefield – the key actors in the conspiracy – and was funded by Fiat Chrysler at between $13 million and $31 million per year. But the UAW has similar funds at Ford and GM as well, and at least the GM fund is also being investigated by the Feds. In November 2017, The Detroit News reported that federal agents were interested in retired UAW Vice President Joe Ashton, who abruptly resigned from the board of General Motors Co. in December, and Cindy Estrada, his successor in charge of the union’s GM department, who was re-elected this week at the UAW Convention. Here is some more about the GM fund from the Detroit News:

Allegations of nepotism are not limited to the UAW-Chrysler training center. GM and the UAW operate the Center for Human Resources training center in Detroit. So many relatives of UAW officials have worked there that some dub the facility the “Center for Hidden Relatives.”

Details about nepotism within the UAW training centers emerged in 2015 when former Center for Human Resources receptionist Shannan McDonald, unsuccessfully sued the training center. McDonald claimed she was forced to resign after being discriminated against due to a disability.

Estrada was deposed in April 2016.

“Ms. Estrada, do you have a daughter or step-daughter named Tara?” McDonald’s lawyer Jeffrey Burg asked during the deposition.

“Tara White,” Estrada said.

“What is she to you?” the lawyer asked.

“She’s my step-daughter,” Estrada said.

“And is Tara White working for (the training center) now?” the lawyer said.

“Yes, she is,” Estrada said.

“Is she working the receptionist job that Shannan had occupied before Shannan left?” the lawyer asked.

“Yes,” Estrada said.

Jerry Dias, Al Iacobelli and Steve Carlisle

When fraud charges were first laid against Al Iacobelli, Jerry Dias could only praise him:

“Jerry Dias, president of Unifor, the union that negotiated with Iacobelli for Canadian autoworker contracts, said he always viewed him as a professional labor executive.

I’ve probably known Al for 15 years. … This is right out of left field. I never would have expected it,” Dias said. “I’m in shock, to say the least.”

L to R: Jerry Dias, Steve Carlisle, President , General Motors Canada and Prime Minister Justin Trudeau attend GM Canada announcement in Oshawa.

After Iacobelli left Fiat Chrysler, he was hired by GM and was put in charge of the 2016 negotiations with Unifor in Canada. Was there similar collusion here? Jerry has so far refused to say if that possibility was investigated. What is not in doubt, is that the 2016 pattern agreement with GM of Canada was the most unpopular in the union’s history, with two-tier wages and the elimination of defined benefit pensions for new hires.

Al Iacobelli is not the only corporate fat cat that Jerry Dias has a soft spot for. When Steve Carlisle left his position as President of GM of Canada, Jerry had only praise for him, including saying he considered him an “ally”!

“For me, it was imperative, during the 2016 contract negotiations, to have someone who I believed was an ally and who was looking for a solution,” Dias said in a telephone interview.  

In 2016, at a General Motors photo op announcement in Oshawa attended by Justin Trudeau and Kathleen Wynne, Jerry refused to sit with members of the union local (Unifor Local 222) because he wanted to be as close as possible to Steve Carlisle and Trudeau (see picture).

Team Concept and Class Collaboration Must Go

Does Unifor also have a “Center for Hidden Relatives”? Whether they practice nepotism or not, it is clear the top Unifor leadership has travelled too far down the road of “team concept” and class collaboration. Auto workers won’t be able to make progress until that losing strategy is discarded.