United Auto Workers Seek to Shed a Legacy of Corruption

DETROIT — For the United Auto Workers, the last five years have been one of the most troubling chapters in the union’s storied history.

A federal investigation found widespread corruption, with a dozen senior officials, including two former presidents, convicted of embezzling more than $1 million in union funds for luxury travel and other lavish personal expenses. Since last year, the union has been under the scrutiny of a court-appointed monitor charged with ensuring that anticorruption reforms are carried out.

The scandal tarnished a once-powerful organization and left many of its 400,000 active members angry and disillusioned.

“You bet I’m mad,” said Bill Bagwell, who has been in the U.A.W. for 37 years and works at a General Motors parts warehouse in Ypsilanti, Mich., represented by Local 174. “That was our money, the workers’ money. I don’t like people stealing our money.”

Now U.A.W. members have a chance to determine how much of a break from that past they want to make. In one of the changes prompted by the corruption scandal, the union this year will choose its leaders through a direct election — its first. Until now, the president and other senior officials were chosen by delegates to a convention, a system in which the union’s executive board could shape the outcome through favors and favoritism, and the results did not always reflect the views of the rank and file.

“Everyone in power is in one party, and it’s been like that forever,” said William Parker, a retired worker who is eligible to vote and hopes to see a new slate of officers take over. “But now we’ve got one man, one vote, and we are mobilizing to change.”

Over four days last week, at a sometimes-chaotic convention in Detroit, some 900 delegates debated a wide range of issues facing the union. Four members were nominated to challenge the incumbent president, Ray Curry, in the fall election. Under rules approved by the delegates, the union’s nearly 600,000 retirees can vote but cannot run for executive offices. If no candidate wins at least 50 percent of the vote, the top two will vie in a runoff.

The convention proceedings dragged out each day as members stepped to microphones to offer motions, objections and requests for clarifications. A day after voting to increase stipends for striking workers to $500 a week from $400, they rescinded the move. At least three times Mr. Curry was scheduled to give a state-of-the-union address only to have the extended debates force postponements, and the convention adjourned without his address.

Mr. Curry is seen as a strong favorite for re-election. He has held senior posts for more than a decade and became president in 2021 in the fallout from the corruption scandal.

One potentially serious challenger is Shawn Fain, an electrician who has been a U.A.W. member for 28 years and holds a post with the union’s headquarters staff. He is part of a slate of candidates for senior posts, and is backed by a dissident group, Unite All Workers for Democracy, which has raised tens of thousands of dollars for the election campaign.

“Members have to believe in the leadership and believe that the corruption is behind us,” Mr. Fain said.

The other candidates are Brian Keller, a quality worker at Stellantis who for years has run a Facebook group critical of the union’s leadership; Will Lehman, a worker at a Mack Truck plant in Pennsylvania; and Mark Gibson, a chairman at Local 163 in Westland, Mich.

The challengers and Mr. Curry agree on most of the key issues at stake in next year’s contract negotiations. Members want automakers to resume cost-of-living wage adjustments, once a key element of U.A.W. contracts, and eliminate compensation differences between newer and more senior workers. Workers hired in 2007 or earlier earn the full U.A.W. wage of about $32 an hour and are guaranteed pensions. Workers hired after 2007 have started at lower wages and can work up to the top wage over five years. They get a 401(k) retirement account instead of a pension.

Dorian Fenderson, a U.A.W. member at a G.M. location in Warren, Mich., started a year ago as a temporary worker at $17 an hour and after four months was made a permanent hire, making $22 an hour.

“There are people making $34 doing the same work as me,” he said. “I know they’ve been here a long time, but it’s not really fair to people like me.”

The opposition candidates have called for the U.A.W. to take a more confrontational line in contract negotiations to win back concessions now that the manufacturers are solidly profitable, and to push them to keep more production in the United States and use more union labor. G.M. is building four battery plants in a joint venture, and Ford Motor is building three with its own partner. The union will have an opportunity to organize those plants, but success is not guaranteed.

“We are hemorrhaging jobs, and that has to stop,” Mr. Fain said.

Mr. Curry said he was confident that battery plants would be organized and that the workers would be covered by U.A.W. contracts with the automakers. He said similar joint ventures had been represented by the union in the past, and noted that current contracts assign engine production to the U.A.W.

“Our belief is that batteries are the powertrains of electric vehicles,” he said in an interview. “It’s just new technology. We have a right to negotiate that and establish those locations.”

One potential weakness for Mr. Curry could be recent actions that have riled some members. He and members of his executive board recently increased pay and pensions for themselves and others working at the union’s headquarters. A vice president who is running for re-election spent $95,000 in union funds on backpacks that were embroidered with his name and were to be given to members at union gatherings, a move that could be seen as using union money for his campaign.

In a July report, the court-appointed monitor, Neil Barofsky, wrote that he had 19 open investigations into possible improprieties, and said Mr. Curry’s leadership group had been uncooperative at times. Mr. Barofsky, a lawyer at a New York firm, wrote that the union’s leaders had uncovered mishandling of union funds by a senior official but that they had concealed the matter, though he added that cooperation and transparency had improved in recent months.

Mr. Curry said that once he learned of the communications issues with the monitor, he stepped in and addressed the matter.

“You have to read report to the end, and at the end the monitor talks about true transparency, response time, and change in counsel, the steps we have taken to shows we are moving in a positive direction,” he said. “And I’ve asked the monitor, if he has issues, to come directly to me so I don’t read about it in a report four months later.”

Mr. Barofsky declined to comment beyond the findings in his report.

Decades ago, the U.A.W. was a powerful organization that could influence presidential elections and consistently won increases in wages and benefits, often through hard-nosed negotiating and strikes. Its contracts with G.M., Ford and Chrysler set standards that helped pull up pay and benefits for working classes all around the country, union and nonunion alike.

But its fortunes waned as the Detroit automakers steadily reduced their U.S. operations and struggled to compete as Toyota, Honda, Nissan and other foreign automakers built nonunion plants across the South. The 2009 bankruptcy filings by G.M. and Chrysler forced the union into once-unthinkable concessions, including the two-tier wage structure.

Over the last 10 years, the automakers have rebounded, often with record earnings, and union workers have benefited. Last year, G.M. paid a profit-sharing bonus of $10,250 to each of its U.A.W. employees. But on other fronts, the union is still in retreat. A 40-day strike in 2019 was unable to prevent G.M. from closing a plant in Lordstown, Ohio, and workers have gone without cost-of-living adjustments to their wages since 2009.

The corruption investigation was started around 2014 by the U.S. attorney in Detroit, and eventually found schemes that embezzled more than $1.5 million from membership dues and $3.5 million from training centers. Top union officials used the money for expensive cigars, wines, liquor, golf clubs, apparel and luxury travel.

More than a dozen U.A.W. officials pleaded guilty. As part of a consent decree to settle the investigation, the U.S. District Court in Detroit appointed Mr. Barofsky to monitor the U.A.W.’s efforts to become more democratic and transparent.

In July, a former U.A.W. president, Gary Jones, was released from federal prison after serving less than nine months of a 28-month sentence. Another former leader, Dennis Williams, served nine months of his 21-month sentence. Other convicted officials were also released after serving less than half of their sentences.

At the convention last week, the shortened sentences were a source of frustration for many attendees, but as the proceedings pressed on, many backed the positions of Mr. Curry and the current executive board on issues that arose.

David Hendershot, a forklift driver at a Ford plant in Rawsonville, Mich., said that he wanted the union to push for higher wages in contract talks next year, and that he wasn’t happy with the corruption that took place. But he isn’t sure he wants a wholesale change in leadership. “I’ll probably stick with what we’ve got,” he said.