Boilermakers Union Pay, Policies Raise Some Eyebrows

Iron

May 13, 2012; Source: Kansas City Star

The International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers has treated its officers, staff, and their families very well while membership has declined, according to the Kansas City Star. It’s rare for any organization to pay half their employees six-figure salaries, but the Star reports that this is the case at the Boilermakers’ union headquarters. In addition, it’s common practice, according to the Star’s examination of the union’s annual reports, for executives to keep their union-paid vehicles as they enter retirement and at least one retiring union official received a six-figure consulting contract from the union.

According to a U.S. Labor Department report, the union holds “fractional ownership” in two private jets and paid over $500,000 in 2011 for maintenance and fees associated with the planes. When union officials don’t fly via private jet, they and their families are allowed to fly first class at union expense, according to the Kansas City Star, which also reports that, approximately one year ago, the union’s International Executive Council spent over $150,000 on hunting at the same rural South Dakota preserve used by former Vice President Dick Cheney and Hall of Fame quarterback John Elway. It’s worth noting that a day before reporting on the union’s executive packages, the Kansas City Star also reported that federal authorities are investigating charges related to alleged mismanagement of the union’s pension and benefits plans.

The Boilermakers union also owns its own bank, and three of the bank’s 11 board members are union officers (another is a retired union officer), the Star reports. The bank’s chairman is Newton Jones, who also serves as the president of the Boilermakers union. Last year, Jones received a salary of $307,134, though if one includes total disbursements (including business expenses such as travel), Jones received $607,022. In 2008, Jones received $230,000 from the bank in addition to his compensation as union president, and more than that in 2009, though his bank compensation dropped to $52,945 in 2010. Attorney Marcus Owens, formerly the IRS official in charge of monitoring tax-exempt organizations, observed that the Jones’s union leadership and bank chairmanship each sound like full-time jobs with full-time compensation.

Union officials defend the salary and employment practices of the union and its affiliated pension funds, saying that they fall within the bounds of appropriate compensation for an organization that controls over $10 billion in assets and serves just fewer than 60,000 members. They also note that it’s common for family members to work for the same large corporation. Conflict of interest policies are apparently followed when the union’s board deliberates on contracts and compensation involving union officials and their family members.

However, a labor union is not a large corporation, but a tax-exempt nonprofit, which means that employees may not improperly benefit from their organization, as some conservative union watchdog groups seem to hint may be happening, based on their statements to the Kansas City Star. Even when conflict of interest policies are followed, board members know that their votes and their decisions affect the livelihoods of people they work with, and those people’s families. –Michael Wyland

About

Michael Wyland

Michael L. Wyland, CSL, has more than thirty years of experience in corporate and government public policy, management, and administration. An expert on nonprofit governance and public policy issues, he has been featured and quoted extensively in media including The Wall Street Journal, The New York Times, CNN, Fox News, Washington Post, The Chronicle of Philanthropy, and The Nonprofit Quarterly. He currently serves as an editorial advisory board member and contributor to The Nonprofit Quarterly, with more than 100 articles published since 2012. Michael is a partner in the consulting firm of Sumption & Wyland. Founded in 1990, the firm provides board governance consulting, public speaking and training, and executive coaching to nonprofit organizations. Sumption & Wyland has assisted more than 200 nonprofits with strategic planning services from pre-retreat research to staff-level implementation assistance and effectiveness monitoring. Speaking topics include board-CEO partnerships, nonprofit executive transition issues, and overviews of the nonprofit sector of the US economy. Michael was born in Washington, DC and raised in the Northern Virginia suburbs. Prior to co-founding Sumption & Wyland, Michael managed the computer operations for an independent oil & gas investor in Dallas, Texas and served as a staff assistant to a U.S. Representative. During his college years, he spent one summer working at the US Department of Labor and one summer working at the US Department of Justice. His past volunteer service includes various leadership positions at the local, state, and national level with the Young Republicans. He has been the secretary and president of a condominium homeowners association and the treasurer of a professional association serving computing professionals. He served as a Trustee and Vice President of Sertoma Foundation, and has been elected president of his local Sertoma club twice. In 2014, Michael was elected Chair of the South Dakota Commission for National and Community Service (Serve SD), on which he has served since its founding in 2011. He is currently working as a senior advisor to establish a national charity dedicated to the elimination of prejudice, expanding the scope and reach of the 120-year old Pi Lamba Phi fraternal organization. Michael's writing for NPQ often addresses healthcare policy and governance, scandals involving nonprofits, and the governance and policy implications of nonprofit stories in the news. He was widely quoted and cited for his work analyzing the governance issues related to the Jerry Sandusky/Penn State/Second Mile scandal in 2011. More recently, he has written more than 30 pieces for NPQ relating to the IRS scandal. In addition, he presented a paper at the national 2014 ARNOVA Conference about the IRS scandal and its implications for regulation of political activity by nonprofit organizations. Michael lives in Sioux Falls, SD with his wife, Margaret Sumption, and their dog. They have one adult son. In his leisure time, he likes to read histories and biographies, play golf, cook, and be a companion to his wife.

  • Bobbie H

    Thank the Lord for those willing to serve fellow workers, take the abuse of the media on a daily basis, under go scrutiny that should be also applied to all in public service and all levels of management, and still after all the outside negativity, perform as servants to the rank and file for pay that no corporate executive would work for. Strong Unions are the only thing that keeps us from becoming a medieval society at a time when some think corporations are people and greed at the top is killing the crop.

  • michael d mirambell

    local 37 newton had all ready talked to launy bussiness manager i’ll stay in touch

    sincerly yours michael d mirambell im talking to jared denbino love yall

  • darin r. holt

    i have been a member of the boilermakers union for 23 years.in the last two and a half years i have worked 230 hours.i have no unemployment no work no income.and the worst part is no one seems to care.

  • amsbug

    I T must be very nice for the big officers to live so well, while those who worked all there good yrs`has never had one raise in there pension. Our bill go up same as there,s but our pension remains the same. Then to make matters worse al l the millions or better said billions, & there own bank just whose benefit is this all for? We all know it was from the sweat from all those old timers who gave a days work for a days pay. Now our hospitalization is terrible the worst we ever had & it seems to be ok with those in charge. We pay more but our pension,s stay the same. Don,t you think its time to let loose of a few dollars & help us that made the boilermaker,s what it is today.. T he wife of a hardworking retired boilermaker

  • Lied To

    One corrupt move that was made by Newton Jones and the international representives was to change their secondary 401K plan into a pension and make the membership responsible for the funding. This pension is called the O&E for Officers & Office Employees, and it was changed so the members are funding a whopping 24% of their wages into this 2nd pension while they increased their portion from 5.3% to 6% or .7%. Then their return increased by 283% so now my business agent gets a $1000.00 a month for every year he serves. Newton Jones will get $3000. A month more for every year after retirement. Now we have been told again that our retirement is under funded and we will be required to increase to pay 110% more a lose 25% on our return. What is really bad is that they duped the government into thinking that their 2nd 401K is a pension that is required.

  • otto

    I have been a boilermaker for over 20 years and all I see is more and more new members coming out of the woodwork, this is the reason there are not many jobs to go around, I could remember when we had less than 1000 members, also all the mills and other industrial jobs are leaving this area, so the more members that our hall brings in insures them that they will have a nice comfortable living while I struggle for health care and insurance that is not worth a dime that I pay into, while I am only allowed to bank so many hours, or I lose them, to who? that is the big question, where is all the money going too, that has sleped through the cracks, the gov. don,t have a clue what is going on, it,s about time they start waking up before it,s too late or is that what they want.i am strickly union but I am concerned about how I am going to live after working a lot of my life away for this union,

  • Sick and tired

    I’ve been a boilermaker in alberta for 15years b welder all Tig tickets and I think it’s time for the 146 to serperate from the greedy pigs in Kansas,83% of new jobs were created in Canada last year were in alberta and yet we seem to be going backwards a 75 cent raise? Really? Maybe Maloney should take a pay cut just like we did, when our increases were based on the price of oil who does that? Enough is enough.where is the 3$ that was taken from the membership years ago? It’s disgusting the union is a joke now and I tell everyone I know about the scams and to never join because it’s not what it used to be. I certainly hope the fat cats increases are based on the price of oil just like ours but I highly doubt it,just about time to pull the pension get a rig and go no union.