Chicago Local Put in “Voluntary” Trusteeship

HERE took over its historically corrupt Local 1 in Chicago on Nov. 29. HERE top boss John W. Wilhelm said local bosses requested the “voluntary” trusteeship because of financial problems and because they want help with organizing efforts. Wilhelm refused to disclose specifics on the financial problems. He would only say the local has more bills than money to pay them. He claimed there is no evidence of corruption or malfeasance, and that local bosses will remain on board and continue to draw salaries — a situation that drew criticism from dissidents who have been calling for their ouster.

Dissident Martin Preib called for Local 1 boss Terrence Maloney and other local bosses to be off the payroll. “It’s an absolute outrage that any of the top officers in the union can draw one more penny from the local,” he said. “Wilhelm is either a liar or the thickest man alive,” said Prieb of Wilhelm’s claims of no corruption in Local 1.

Wilhelm said a new election will be held at the yet-to-be-determined end of the trusteeship. He appointed Henry Tamarin, a HERE vice president and president of Local 100 in N.Y., as Local 1 trustee. Maloney was elected president May 1999 which was the first contested election at the local in 16 years. HERE had previously appointed Maloney as president in 1998, after Thomas Hanley was forced to resign from that post. At that time, Hanley was suspended for a year from the union and required to pay a $25,000 fine after a federal monitor charged that he improperly spent union funds. The monitor also charged that Hanley paid a $31,000 annual salary to his father, former international President Edward T. Hanley, although the elder Hanley performed no work for the local.

The monitor’s report found that the local received more than $2.6 million in assistance over the years from HERE, more than any other local. This occurred as Local 1 officers disregarded recommendations to cut staff, ignored loan repayments and accumulated large pension payment and administrative debts while raising their pay and those of union staff, the report said. The monitor found that the international has forgiven $604,000 in old debts, but Local 1 still owed the HERE over $1 million, and the report uncovered what it said was a pattern of financial mismanagement that should have prompted HERE to place it under trusteeship years ago. The report followed a government suit on allegations of mob ties at the union. That investigation led to the resignation of the elder Hanley. He struck an immunity deal that barred him from exercising any direct or indirect influence over union affairs for life.

James Michalik, who lost to Maloney in the May election, welcomed the trusteeship. “I’m surprised the international hasn’t come in earlier,” he said. He’s also surprised that Maloney, who has been in his post for more than a year, has been unable to address the problems. “I would have thought they could have gotten a handle on things by now,” he said.

A unnamed source in the Dep’t of Labor echoed Michalik’s comments. Based on the monitor’s report, the source expressed frustration with Wilhelm’s 14 months of inaction. “They’ve had financial problems for years and [Wilhelm] knew about them,” the source said. “Why didn’t he do this last year when the monitor’s report came out? There is a lot about this that doesn’t make sense.” [Chi. Sun-Times 11/30/99; BNA 12/1/99]