NEW YORK – A prominent labor union has been slapped with a class-action lawsuit that accuses it of using a firm that cooked its accounting books to help hide union dues spending.
Mark Simpson, an employee of Shenango Presbyterian Seniorcare, filed an unfair labor practice claim with the National Labor Relations Board against the International Brotherhood of Teamsters on Thursday. Simpson alleges that the labor union used Thomas Havey LLP, a top union accounting firm, to help justify its forced union dues.
"We believe this case is, of course, going to open up and a lot of people are going to join this," said Dan Cronin, the legal director for the National Right To Work Foundation, which is offering free legal aid to Simpson. "We believe as more workers hear about what's going on, they're going to demand there be some action."
But Bret Caldwell, spokesman for the Teamsters, called the suit "frivolous" and said the union has nothing to hide.
"The fact is, they're filing a frivolous lawsuit," Caldwell said, dismissing the charges. "They're just barking up the wrong tree."
About 7.8 million workers around the country are required to pay union dues.
Under law, union officials must provide employees with independently audited disclosures of how their union dues are spent, particularly if they are being used for activities unrelated to collective bargaining or other union activities.
Simpson claims the Teamsters won't give him an independent audit.
According to its Web site, Thomas Havey is the auditor for "over 700 collectively bargained, multi-employer and single-employer plans with total assets of over $42 billion." The firm claims: "Labor is our specialty. [Our firm] is proud of its long and rewarding association with the organized labor movement."
But Thomas Havey has recently come under fire for its accounting practices. In August, firm partner Frank Massey pleaded guilty to federal criminal charges of "aiding a conspiracy" to defraud the United States by helping union officials hide on government disclosure forms how they spent more than $1.5 million in union dues.
"What you have here is the Teamsters using an accounting firm that has been known to be cooking the books," Cronin said.
Caldwell argued, however, that the union has "the most open books in America," and it fulfills its requirements with the Labor Department to disclose financial activities. Just this last January, the federal government removed an auditor assigned in 1997 to review the Teamsters' books after it ruled that the books were clean, Caldwell said.
He added that the union has had "many discussions" with Thomas Havey to make sure that no one associated with the court proceedings were connected to Teamster activities.
Nonetheless, Rep. Charlie Norwood, R-Ga., chairman of the House Education and the Workforce Subcommittee on Workforce Protections, has sent a letter to NLRB arguing that the audits conducted by the Havey firm for more than 70 unions are unreliable.
Given the recent labor accounting scandals involving the firm, "it is reasonable to assume that it is even more likely that unions have deceived nonmember compulsory agency fee payers with the assistance of the Havey firm," Norwood wrote.
Add to that the recent guilty pleas by Thomas Havey partners, "no audit by the Havey firm can be presumed trustworthy," he wrote, adding that he expects other workers to soon join the lawsuit.
Norwood asked the NLRB to report to him by Oct. 7 on anything new on the matter.