Union manager fired, officers internally charged, as financial wrongdoing investigation continues

A former union manager with a Newfoundland chapter of the International Brotherhood of Electrical Workers has been terminated and an unspecified number of previous and current union officers have been internally charged amid allegations of possible embezzlement and other unauthorized spending.

The accused haven't had union hearings yet, but if it's determined that any provincial or federal criminal law has been broken, IBEW's national office — IBEW Canada — says it will be turning the case over to "the proper authorities."

For now, the investigation is trying to determine whether IBEW's constitution has been broken.

In a letter addressed to union members Aug. 19, Thomas Reid, the international vice-president of IBEW Canada, said "undisputed" and sometimes "overwhelming" evidence has been collected.

Reid's letter said evidence shows a former Local 2330 president expensed "a very substantial" amount in taxi fares despite being given a car allowance.

Katie Breen/CBC

The letter also says undisputed evidence shows that the president's sister, who worked for the union, received a "substantial" unauthorized payout as "severance."

A former business manager's salary increased more than 70 per cent in five years without member consultation, according to the document.

And, the document said, it appears employees from at least 2012-2018 were getting regular wages during their vacation days, plus 13 per cent vacation pay — sometimes more.

IBEW Canada says a former business manager has been fired and internally charged, other current and former Local 2330 employees are also facing possible union discipline, and the president who took all the taxis no longer works for the union.

When former union treasurer James Martin was asked if he felt vindicated by Reid's letter, he said, "no, not yet."

Martin ran for Local 2330 treasurer in September to get a better look at the books after years of suspecting financial mismanagement by union employees.

In June, IBEW Canada put Local 2330 under trusteeship and suspended the current executive. 

We all just want to go to work and take care of our families. - James Martin

Martin kept copies of the union receipts he had access to and provided CBC with copies of some of them in hopes of pressuring the national office to speed up the investigation.

According to Martin, personal reimbursement cheques paid out to office management and staff, on top of salaries, add up to $1.82 million over six years.

Some of those expenses are legitimate, Martin said, but he suspects most of it is not.

In that same 2013-2018 timeframe, Martin found cheques for per diems, car allowances and LOA — the common abbreviation for living out allowance — that he said weren't approved by union membership and went to people who shouldn't have qualified for them, since they lived near union headquarters.

IBEW Canada website

Martin showed CBC thousands of dollars worth of union cheques made out to a local cab company. In six years, Martin said, Local 2330 spent a total of $345,745 on taxis.

"We asked if we were paying taxis to some of our office staff at one of our local meetings, and we were told that we were not and they were paying for them themselves," he said.

No due date

Martin wants more frequent and detailed updates on the investigation, and for IBEW Canada to address the allegations of unauthorized per diems and living allowances. Members were promised an interim report from the ongoing forensic audit two months ago, Martin said, but vice-president Reid disputes that.

In an emailed response to CBC, Reid said "a well-respected outside professional accounting firm that specializes in providing audits and forensic audits" is working on the case.

Reid said union members were told about the June interim report, but weren't promised copies of it.

Sharing a draft version would be inappropriate, he said, adding the report "would only be viewed and used by IBEW Canada for purposes of the investigation."

Reid isn't sure when the final report will be completed and made available.

But in the meantime, IBEW Canada is keeping Local 2330 under trusteeship.

Katie Breen/CBC

Martin hasn't had union work since December 2016 and said other members are in the same situation. 

"We have journeyman electricians right now working at Tim Hortons and Walmart, people applying to work at Costco …  Some of our members are going to foodbanks," he said, adding that the money allegedly taken could have been used to take care of members in "dire times."

In addition to financial wrongdoing, Martin alleges Local 2330 has been creating weak agreements and allowing companies to pick all of their workers, which is leaving some people behind.

Reid, with the IBEW national office, said "the local is not playing favourites," but that hiring is under review.

"The trustee is examining the local's referral practices to ensure that they operate fairly, and if the collectively bargaining manner of referral needs to be changed, that is something that would have to be done through negotiations with the contractors," he said.

 Martin hopes "a fair transparent union that treats members the same" will come out of this. 

"We all just want to go to work and take care of our families," he said.

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