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1
E1STUNIC
1 UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
2 ------------------------------x
3 UNITED STATES OF AMERICA,
4
Plaintiff,
5
v. 90 Civ. 5722 (RMB)
6
DISTRICT COUNCIL OF NEW YORK
7 CITY and VICINITY OF THE
UNITED BROTHERHOOD OF
8 CARPENTERS and JOINERS OF
AMERICA, et al.,
9Defendants.
10 ------------------------------x
11 New York, N.Y.
January 28, 2014
12 9:30 a.m.
13 Before:
14
15 HON. RICHARD M. BERMAN,
16 District Judge
17 APPEARANCES
18
PREET BHARARA
19 United States Attorney for the
Southern District of New York
20 BY: TARA LaMORTE
Assistant United States Attorney
21
REVIEW OFFICER
22 BY: DENNIS WALSH
Review Officer
23 - and -
MINTZ LEVIN
24 Attorneys for Review Officer
BY: BRIDGET ROHDE
25
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1 APPEARANCES CONTINUED
2 ZUCKERMAN SPAEDERAttorneys for District Council
3 BY: BARBARA JONES
4 SPIVAK LIPTON
Attorneys for District Council
5 BY: JAMES MURPHY
ADRIAN HEALY
6
McELROY, DEUTSCH, MULVANEY & CARPENTER
7 Attorneys for Wall Ceiling Association
BY: MARK A. ROSEN
8
HOLLAND & KNIGHT
9 Attorneys for Building Contractors AssociationBY: LOREN L. FORREST JR.
10
KAUFF McGUIRE & MARGOLIS LLP
11 Attorneys for District Council Fringe Benefit Funds
BY: RAYMOND G. McGUIRE
12
ALSO PRESENT: JOSEPH GEIGER, EST
13
14
15
16
17
18
19
20
21
22
23
24
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1 (In open court)
2 THE COURT: So first off, congratulations to the new
3 EST. Is he here?
4 MR. GEIGER: Yes, your Honor.
5 THE COURT: Congratulations.
6 MR. GEIGER: Thank you.
7 THE COURT: And how was the vote? What was the
8 process? Did you win by.
9 MR. GEIGER: It was slightly more than a two-to-one
10 margin. The vote was held Friday, and the votes were tallied
11 on Friday.
12 THE COURT: Nice to have you here.
13 MR. GEIGER: Thank you.
14 THE COURT: So I received a letter from Judge Jones
15 yesterday evening or so, and it's very helpful. What I would
16 like to do today is deal with these -- the following issues in
17 the following order.
18 First, in Judge Jones' letter she raises at the end of
19 the letter this issue about international agreements, and
20 frankly, I would like to hear about that first. I'm curious as
21 to know what that's about and where that's leading us. So
22 perhaps on that issue I might hear from Mr. Walsh and also then
23 the district council and anybody else that wants to add
24 anything to that. So that would be the first thing I would
25 like to hear about.
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1 The second I would like to talk about the two pending
2 CBAs. I'm aware that they had -- you are too, that they had
3 been earlier submitted but never acted upon by me, and that is
4 because of my concern that they contain provisions that -- this
5 may be too strong, but on their face are not being complied
6 with. That's the whole point of the other discussion that
7 we're having here is that the so-called anti-fraud provisions
8 in all the CBAs do not appear to be -- well, that may be too
9 strong, but you understand my point about that. It's kind of
10 odd to go forward and approve an agreement, which I probably
11 would not have done incidentally historically had I known at
12 the time that the provisions that are mandatory in the
13 agreements, they use the word "shall," were not or could not or
14 were not adequately being complied with. That would be the
15 second issue.
16 Then I would like to talk about the proposed new
17 amendment of the stipulation and order, what that's about, why
18 people feel that's important and necessary, then to talk about
19 the status of electronic reporting. I did note that one of the
20 consultant, I don't know if that's what it's called, that
21 District Council retained, one of its early recommendations was
22 that there be in-house IT capability. That's something that I
23 have been thinking about and talking about for several months
24 now, and frankly I have been surprised that that issue hadn't
25 been taken care of a long time ago. But anyway, I'm all for
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1 that. And then we can talk more about electronic reporting,
2 where that stands.
3 And then there's an issue about Mr. Walsh. Is he here
4 today?
5 Not the RO Walsh, but -- well, maybe that issue will
6 not be pursued, but we'll see.
7 So yeah, with that in mind, then of course we can hear
8 about if anybody has any other issues that they want to
9 discuss.
10 So let's hear about this, Mr. Walsh, if we might, this
11 international agreements issue. It's somewhat of a concern to
12 me because it suggests, at least from Judge Jones' letter
13 that -- maybe this is too strong, but somebody is trying to
14 evade the terms and conditions of the collective bargaining
15 agreement, at least in spirit, and that is a problem, in my
16 opinion.
17 MR. WALSH: Judge, Dennis Walsh, the review officer.
18 The issue surfaced within the past few weeks, and
19 there's been much discussion between the District Council and
20 at first the Wall Ceiling Association and their counsel. I
21 attended one of the early meetings where District Council
22 forcefully articulated its position that there are genuine
23 compliance issues, and others are not fully satisfied, that
24 there has not been some intention on the part of the Wall
25 Ceiling Association, and perhaps a couple of the other
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1 associates, to evade certain aspects of the requirements, the
2 compliance requirements, approved by this Court in their
3 substantive agreements.
4 And my position that I articulated at that meeting and
5 to others has been that I think on the pure economics, I don't
6 particularly have any interest, and I don't think the Court
7 does either, I certainly don't pretend to speak for the Court.
8 But on the compliance issue I have a very strong interest, as
9 surely does the Court, and if there has been any intention to
10 avoid any aspect of the compliance by holding these
11 international agreements in reserve for these small jobs, these
12 one-man and two-man jobs, then I think it's a fair question for
13 further inquiry.
14 THE COURT: So you might, just so the record is clear,
15 just briefly describe what the issue is, so to speak, that is
16 presented.
17 MR. WALSH: I would certainly yield to Judge Jones and
18 Jim Murphy on the particulars of the discussion, but as I
19 understand it -- and these international agreements have been
20 used for years. There have always been international
21 agreements on these one- and two-man jobs. The singular
22 difference now is that we have associations that participated
23 in collective bargaining on the large agreements, I will call
24 them.
25 THE COURT: The ones that have been approved.
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1 MR. WALSH: Right. With very specific compliance
2 components, the electronic reporting. And I think there's a
3 fair argument that the provision, the so-called matching
4 provision where you bring in a member of another union not
5 affiliated with District Council into the New York City
6 jurisdiction, then he or she must be matched with someone from
7 the District Council out-of-work list. Certainly the
8 government has always had the position that there is a
9 compliance benefit to having a New York City carpenter who is a
10 member of a local union affiliated with the District Council on
11 a job, so that if there is any misreporting or under reporting
12 or any shenanigans whatsoever on the job, then the New York
13 member would have an interest in reporting it.
14 So as I understand it, there have been a couple of
15 grievances filed. I don't think that the issue is quite ripe
16 yet as far as this Court is concerned, but I think it was a
17 very important thing for the District Council to point out
18 should any signatory contract who is a party to one of the
19 contracts approved by this Court have the intention to enter
20 into an international agreement with the intention of avoiding
21 the compliance components from the large contract. I will
22 certainly yield to Judge Jones and Jim Murphy if I left
23 anything out or they want to refine what I said.
24 THE COURT: So there's a point when compliance
25 provisions wouldn't apply to any international contract?
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1 MR. WALSH: I do want to clarify. The head of the
2 Wall Ceiling Association did say they would, without any
3 question, comply with the electronic reporting, but I think
4 there's a fair question as to how that would happen if the
5 intention of the contractor is to use two non-New York City
6 members. And as the District Council and Judge Jones pointed
7 out in their letter that the Court received yesterday, they
8 would not be able to completely rely on reporting from some
9 person who is not a member of a local union here in New York
10 City.
11 THE COURT: Do we have -- I thought I saw Wall Ceiling
12 counsel here today?
13 MR. ROSEN: Yes.
14 THE COURT: Maybe we should hear from him and then --
15 MR. ROSEN: Good morning, your Honor, Mark Rosen from
16 McElroy, Deutsch, Mulvaney & Carpenter.
17 THE COURT: I think you better slow down.
18 MR. ROSEN: Attorney for the Wall & Ceiling
19 Association.
20 THE COURT: And maybe if you could restate your name
21 and the name of your firm.
22 MR. ROSEN: Mark Rosen, McElroy, Deutsch, Mulvaney &
23 Carpenter.
24 Your Honor, let me start by addressing this contention
25 that there's been some attempt to evade the provisions of the
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1 collective bargaining agreement that was approved by this
2 Court.
3 As the review officer has noted, these international
4 agreements have been in place literally forever, and their
5 intent is to allow union contractors in Long Island,
6 Westchester, to bring their union carpenters, who are members
7 of other locals of the international, sister locals, if you
8 will, into the five boroughs to perform work. And they provide
9 the provisions of how the benefits are paid, reallocated, and
10 all that. That has been in effect forever.
11 Then last year a new collective bargaining agreement
12 was reached between Wall & Ceiling and the District Council and
13 it was in effect. At that time there was an international
14 agreement in effect. And there was no discussion in the
15 negotiations that the collective bargaining agreement was going
16 to preempt the international or affect the international in any
17 way. I think what's at issue is that in the new collective
18 bargaining agreement there's a provision for a two-man job
19 which could be worked without a steward designated by the
20 District Council. So there's been no attempt to evade.
21 In June of this year, a month after this Court
22 approved the collective bargaining agreement, the Wall &
23 Ceiling Association included an agreement with the
24 international. This is not something that has been done
25 unilaterally. The agreement was negotiated, approved and
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1 signed with the union's international, a new international
2 agreement in June. We don't believe that there's a conflict.
3 We believe that under the international constitution this
4 agreement is proper, these international agreements are
5 recognized throughout the country.
6 THE COURT: Nobody is disputing any of that. So the
7 dispute is what are the implications for the provisions of the
8 collective bargaining agreement, in particular, the electronic
9 reporting for the international agreements.
10 MR. ROSEN: As the review officer pointed out, we had
11 a meeting at the District Council where the head of the
12 association confirmed unequivocally that the association is
13 willing to have the anti-corruption and compliance provision
14 apply to any job invoked under the international.
15 This other logistical concern that's being raised in
16 Judge Jones' letter about how it's going to work, quite frankly
17 I think there has to be some discussion on that. Historically,
18 again, jobs were called into the union under the international.
19 They were assigned a job number, time was reported, benefits
20 were paid. I don't know why this is now going to be such a big
21 difficulty.
22 THE COURT: So you think that the electronic reporting
23 features will, A, apply, and B, be usable in the context of
24 these international agreements? That's what I'm hearing.
25 MR. ROSEN: The association has committed they will
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1 apply. Usable gets into the technology, but we will cooperate
2 to make sure that they are.
3 THE COURT: Okay.
4 MR. MURPHY: James M. Murphy, Spivak Lipton, for the
5 District Council.
6 If I may, your Honor, just briefly give a history or
7 chronology of this.
8 THE COURT: Don't go back too far. He said they have
9 been in place forever.
10 MR. MURPHY: On July 25th, 2012, the executive
11 director of Wall Ceiling addressed the delegate body because
12 they were in negotiations with the District Council for full
13 mobility. And one of the things that he tried to get the
14 delegates to agree to the full mobility and the other
15 provisions, he said: What does the two-man job without a shop
16 steward, what does that do? It keeps New York City carpenters
17 working the two man and out-of-towners can't work the two-man
18 job. It's got to be a New York City District Council
19 carpenter. In addition to that, it eliminates for the need for
20 someone to use an international agreement where he comes in
21 with two guys from out of town and there are no New York City
22 carpenters working on that job.
23 On August 22nd --
24 THE COURT: I don't really get it.
25 MR. MURPHY: What I think he was saying is that by
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1 agreeing to the new agreement between the District Council and
2 the Wall Ceiling Association, there would be no need for Wall
3 Ceiling Association members to invoke an international
4 agreement.
5 In the past, one- and two-man jobs were not covered
6 under the District Council's agreement of Wall Ceiling, so this
7 was one of the concessions they made with the one-to-one
8 matching, which effectively meant you always would have on a
9 two-person job two District Council members, because no
10 contractor is going to have to do the matching of four people
11 on a two-person job.
12 The deal was done on August 22nd, 2012. As your
13 Honor, I think in retrospect correctly, pointed out that the
14 best practices were to going to be to reduce the deal to a
15 collective bargaining agreement, that was done in March of
16 2013, was submitted to the Court, the Court allowed for an open
17 comment period and then issued an order on May 8, 2013
18 approving the collective bargaining agreement, including the
19 electronic reporting and anti-corruption compliance procedures.
20 It wasn't until August of 2013 that the Wall Ceiling
21 and the UBC executed this agreement, and then recently during
22 the fall has had New York City Wall Ceiling Association members
23 attempting to use the agreement.
24 The District Council's position is this subverts the
25 economics of the New York City District Council/Wall Ceiling
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1 agreement, and also subverts the anti-corruption compliance
2 because on these jobs with the international there will not be
3 District Council members, it will be people from out of town
4 and from other UBC locals. That's our position.
5 THE COURT: Strikes me, unless I'm missing something,
6 there's two different issues. One is you're suggesting there's
7 a conflict between the basic CBAs and these international
8 agreements as an economic matter, the other is the issue raised
9 by Judge Jones whether the provisions of the CBAs apply to
10 those international situations. Am I getting that right?
11 MR. MURPHY: Yes, sir.
12 THE COURT: So Mr. Rosen is saying as to the latter,
13 no problem, right? They do apply, we'll work it out,
14 anti-corruption provisions, and how they apply we'll work it
15 out. But the broader issue that you're raising is -- I'm not
16 sure how that gets resolved, but it doesn't appear to be the
17 issue that is presented to me.
18 MR. MURPHY: We understand the Court's order from
19 May 8 was approving the entire collective bargaining agreement
20 with Wall Ceiling as that also included the anti-corruption
21 compliance.
22 THE COURT: There's no question about that.
23 MR. MURPHY: And that we don't believe that Wall
24 Ceiling can then essentially a year later pick and choose what
25 provisions that it's going to use, whether it implicates the
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1 economics of it, and we think it also implicates the
2 anti-corruption compliance. We have no idea with these
3 international agreements how the anti-corruption compliance and
4 the electronic reporting would be done.
5 As your Honor is well aware, we have been making our
6 best efforts with the Wall Ceiling/District Council CBA as well
7 as the subsequently approved CBAs to make sure that the
8 anti-corruption compliance and electronic reporting is working.
9 And now this adds -- seems to add and sort of foists upon the
10 District Council a chore that it never took up in collective
11 bargaining with its employer associations.
12 THE COURT: I get the issues, so to speak.
13 MS. JONES: Judge, all I wanted to say was obviously
14 if we cannot work something out with Wall Ceiling with respect
15 to anti-corruption measures, that would be something we would
16 immediately bring to the Court's attention.
17 THE COURT: Very clearly it sounds like Mr. Rosen is
18 saying that, A, they apply, and B, he's willing to work it out.
19 MS. JONES: They have conceded they applied, so we
20 need to work something out.
21 With respect to whether or not there's -- using these
22 internationals violates the CBA itself, we didn't want to end
23 up in an arbitration without advising your Honor that that was
24 coming.
25 THE COURT: So how does that -- that plays out in
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1 arbitration?
2 MS. JONES: It will. We expect to be in arbitration
3 with Wall Ceiling, from our discussions with them, on this very
4 issue.
5 THE COURT: And that is provided for where?
6 MR. MURPHY: It's in the District Council/Wall Ceiling
7 collective bargaining agreement if there's any disputes between
8 the parties.
9 THE COURT: I got it.
10 Mr. Rosen?
11 MR. ROSEN: Your Honor, sorry, but I need to address
12 one thing on the record in defense of my client. Mr. Murphy
13 read a statement that our president -- our managing director
14 Mr. Delollis allegedly made in some meeting. We heard that
15 reference before. I don't know what he's reading from. We
16 asked for the transcript. Mr. Delollis asked for the
17 transcript because we believes the statement is being taken out
18 of context, and we have never been provided one. So if that's
19 something available, we would like a transcript so Mr. Delollis
20 can explain it.
21 THE COURT: That's certainly fair, but I'm sure you'll
22 work that out between the two of you.
23 MR. FORREST: Loren Forrest from Holland & Knight for
24 the Building Contractors Association.
25 To the extent it affects our association, it's not
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1 directly implicated --
2 THE COURT: To what extent could it be?
3 MR. FORREST: Just there are some individual members
4 of the BCA who do have these agreements with international, but
5 the BCA did not negotiate nor sign, is not a party to those
6 agreements, so just on behalf of our client I wanted to
7 distinguish ourselves from the Wall & Ceiling Association and
8 state that we obviously work with Judge Jones and Mr. Murphy if
9 there's any issues implicating the BCA.
10 THE COURT: You're distinguished by the fact you're
11 not the Wall & Ceiling Association.
12 MR. FORREST: It was just the District Council has
13 taken the position with regard to some of the individual
14 members that international agreements may present problems for
15 them, and there have been grievances about those issues. I
16 wanted to disclose that to the Court. Thank you.
17 THE COURT: So now if we could turn to two pending
18 CBAs, Mr. Walsh. And first, if you would, what is your view
19 about -- and I intentionally did not go forward because we were
20 waiting to make more progress with respect to the compliance
21 with the electronic reporting, so I don't exactly know how that
22 fits with these two outstanding CBAs.
23 MR. WALSH: Judge, it seems to me that we are
24 unavoidably stuck with a certain reality that the District
25 Council has developed a system which has been described in the
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1 various 30-day reports to address what are technological
2 deficiencies. I had many discussions with counsel for the
3 union, with the government, three-way discussions, and it seems
4 to me -- and I have articulated this position, these 30-day
5 reports have become too complicated. They are too much of an
6 exercise in advocacy, that simply what we all need to know is
7 how many hours have been worked in a given period, and within
8 72 hours from the completion of that work, how much of that
9 time has been entered into a system that's reliable.
10 THE COURT: Well, and when you say "reliable," you
11 also mean accessible by individual. We had this whole
12 discussion about the one big aspect of this system was so that
13 they would be able to independently check and see hours
14 reflected.
15 MR. WALSH: And that feature is the sole basis why my
16 office and the government signed off, and I assume the Court,
17 that if they can do this, if the rank and file can log on and
18 see the time, it is a singular advancement in anti-racketeering
19 and anti-fraud.
20 THE COURT: What you're saying is accurate, that was
21 very important in my determination whether or not to approve
22 those changes.
23 MR. WALSH: So when the District Council concludes in
24 its most recent report and in Judge Jones' letter of yesterday
25 they're at 98 percent, I'm not quite sure what that means.
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1 And I keep thinking about a statement that I made in
2 the fourth report a couple of years ago, it's on page 24, where
3 we reported that only 75 percent of the time actually work was
4 being captured by the paper steward report system. There was
5 6.2 million hours over and above that that the contractors
6 themselves remitted to the Benefit Funds in raw man hours.
7 And this ties into the other question that I think is
8 very important in my mind, which is the complete turn over of
9 all time entry into some reliable electronic format. I think
10 right now they have about 60 percent of the work that's subject
11 to the Court-approved CBAs, but there's another key 40 percent
12 that still is relying on this terrible paper steward report
13 system. And although the District Council recognized the need
14 to move forward, we don't have a date certain or a target date
15 even for when all time must be entered into the electronic
16 system so that we can get the benefits of this member
17 oversight.
18 THE COURT: As practical matter, at the present time
19 does the 60 percent cover these two agreements or are these two
20 agreements are outside the 60 percent?
21 MR. WALSH: I don't know the answer to that question,
22 Judge. I think they are not very broad in scope, not that they
23 are immaterial, but they certainly don't compare to what the
24 Court has already approved in substance and volume.
25 So I think the real question is what can be done to
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1 accelerate the process of getting a real technological cure for
2 these problems that this six-person team is engaging in certain
3 fixes, but I think there is an open question as to how reliable
4 it is. And I would like to know if there's something that
5 could be done to really accelerate the technological fix here.
6 And certainly Segal's recommendation that an on-site
7 IT person be in place is something that you and I have been
8 talking about for many months. It was obvious to Segal that
9 was something that had to be done. I would hope there's some
10 qualified person or a couple of people that the District
11 Council could hire that could focus their intellect and
12 experience and training in improving the reliability of the
13 system that they have now rather than having to wait many, many
14 months, over a year, until this RFP that Segal is developing is
15 actually going to bear fruit by hiring some national vendor
16 coming in and fixing all the hardware and updating the
17 software, which is really so far down the road, I think it
18 makes the question of what could be done in the interim an
19 imperative, and only the District Council can adequately
20 respond to that. It's a question of resources and will, in my
21 view.
22 THE COURT: So I agree with you. Let's hear from the
23 District Council. We'll move then to the status of this
24 electronic reporting.
25 MR. MURPHY: Judge, the two collective bargaining
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1 agreements in front of you are with the Association of Concrete
2 Contractors of New York, which covers Nassau and Suffolk
3 Counties. The total hours for those two associations with
4 respect to the District Council is approximately maybe 200,000
5 hours a year compared to 16, 18 million hours a year.
6 One of them is close to the GCA Heavy Construction
7 Carpenters contract, and the other one is for the structural
8 concrete, which is close to the Cement League, which is here in
9 the New York collective bargaining agreement, just to give you
10 some background.
11 THE COURT: I get it, but the real question is -- the
12 legal question is is there an inconsistency in approving those
13 agreements which contained clauses in them which we are all
14 here, and have been for months, arguing -- or not arguing, but
15 discussing whether those are being complied with or can be now
16 or 14 from now. That's the theoretical problem with them that
17 I foresee.
18 MR. MURPHY: Right.
19 THE COURT: So what do you think as to that?
20 MR. MURPHY: Excuse me, your Honor?
21 THE COURT: What do you think about that?
22 MR. MURPHY: I think it's an ongoing issue that the
23 District Council has been wrestling with, and that's why we
24 have the Segal company in. That's why we're going to end up
25 hiring an on-site IT person.
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1 THE COURT: I get all that, but do you see any
2 inconsistency with approving agreements which contain
3 provisions that you know are an ongoing problem but are not, as
4 the provisions provide, "shall," are not and won't be
5 implemented?
6 MS. JONES: Judge, we think that we are complying with
7 reporting within 72 hours at 98 percent. When we first took a
8 look at the numbers that were provided to the Court in the
9 first couple of months, there were obvious issues. Jobs that
10 appeared to be open -- and this is what you heard before --
11 were actually jobs that had been closed. And so it looked as
12 though we were not reporting hours for jobs when in fact there
13 were no hours being worked.
14 We have finally a job closed box, because one of the
15 biggest problems, as I just mentioned, in getting accurate
16 hours is to know that jobs have closed. That is going to go
17 live. Standard Data did the work on it. It's to go through
18 live on February 15th. This Wednesday and Thursday the shop
19 stewards are all being trained on how to use this box.
20 Once the shop stewards are able to electronically
21 close these jobs, that will reduce the number of unreported
22 hours dramatically. And I want to say that it's complicated to
23 figure out which jobs are still open or closed, which jobs may
24 have been carried even though they hadn't begun yet, and a
25 number of other factors. But in order to try to give your
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1 Honor as close to an accurate percentage of compliance as
2 possible -- and for that reason we had to use our person power
3 as opposed to our system, because our system simply cannot tell
4 us what is happening on any given day. We have used it, and we
5 stand by our numbers, and we think going forward we can achieve
6 the same compliance with the contracts before your Honor now.
7 THE COURT: I get all that. But as Mr. Walsh said, at
8 least in my mind, at the time of approval of these so-called
9 anti-corruption technology provisions, was the promise that any
10 individual worker, carpenter, could go online and double-check.
11 That was the transparency issue and that was something that I
12 thought was very appealing and very important.
13 And I don't know -- I don't think your 98 percent says
14 that 98 percent of all carpenters can do that with reliability.
15 That's the missing factor, or if it's not missing, I just don't
16 understand where that stands, and that is what I'm interested
17 in seeing.
18 MS. JONES: What we're saying is that 98 percent of
19 all jobs and the hours for all jobs are going in within that 72
20 hour framework into Watchdog, and any carpenter can look in
21 there and, at least within the 72 hours framework, check his
22 hours and check the number of people on his crew.
23 THE COURT: That's true now or going to be true after
24 February 15?
25 MS. JONES: No, no, no, that's true now, since our
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1 first report to the Court in December when we -- I think we
2 were at --
3 THE COURT: 95 percent.
4 MS. JONES: -- 95, that's been true. It was 95 then,
5 but it's over 98 now.
6 And again, I can only say if you look at any given
7 day, let's say there were a hundred jobs that were opened, and
8 then you check the job, you find out that on that day it was
9 closed, that could be 20 of those hundred jobs that shouldn't
10 have been there, it could have been ten of those hundred jobs.
11 THE COURT: I get it.
12 MS. JONES: So that's what we have been doing. I
13 regret we don't have a computer system yet that would make it
14 easy for us to track this, but we're prepared to write a
15 simpler exposition of how we're doing this. But basically it's
16 accurate. It does take people to call up and find out and
17 verify that the job was closed, for instance, or what the other
18 reasons may have been. And when they discover a job where it
19 was late beyond the 72 hours, that goes into the percentage
20 that where there's non-compliance.
21 THE COURT: So to me this sounds like --
22 MR. MURPHY: Just to make it clear, your Honor, I
23 don't think there's ever been an issue since implementation
24 back in the spring of 2013, the first collective bargaining
25 agreement being the Wall Ceiling/District Council agreement
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1 that Operation Watchdog wasn't available.
2 THE COURT: Was not available?
3 MR. MURPHY: There's never been an issue with
4 Operation Watchdog, that members have always been able to get
5 into the portal to check their own jobs. The issue was whether
6 or not the hours and the people were being reported. And one
7 of the big issues was with the closed jobs or you had shop
8 stewards who were not compliant with the reporting procedures.
9 But the availability of rank and file workers to get in and to
10 check their own jobs and their own hours has, as far as I know,
11 has never been an issue.
12 So that part, and sort of as the review officer
13 correctly states, that being sort of the lynchpin of this whole
14 anti-corruption compliance where you're going to have the
15 watchdogs of the rank and file members as literally watchdogs
16 of their own jobs, that hasn't been an issue, the issue has
17 been whether or not they're reporting from the shop stewards or
18 the designated reporters on the one- and two-person jobs has
19 actually come in.
20 MS. JONES: And I would just say, your Honor, that --
21 and I probably said this, but once the job closed box goes into
22 operation and works, we won't need five or six people making
23 phone calls to find out if the job ever existed. It should
24 greatly reduce the amount of additional person involvement,
25 because that seems to me to be the single biggest reason why
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1 our numbers look like we're not reporting.
2 THE COURT: Mr. Walsh?
3 MR. WALSH: Judge, as I said, I think we are stuck
4 with the reality that we have got this ad hoc temporary system
5 which reflects I think at best the status quo that counsel can
6 produce. But I reiterate if there's anything else that can be
7 done before this lengthy process of RFPs and retaining
8 consultants is finished off, if there's anything else that can
9 be done to increase the reliability in an efficient way, that
10 the District Council should do everything in its power to make
11 that happen.
12 THE COURT: And what might that be?
13 MR. WALSH: I think they have got to get these IT
14 people, their own employees hired, and I think they need to be
15 talented and they need to be well compensated in exchange for
16 that talent and experience. And I think that in addition to
17 the usual everyday IT things, fixing computer glitches at
18 people's work stations, they can work with any national
19 consultant that is on the scene, and the employee's own
20 counsel, and see what light bulb they can turn on over in
21 situation and see if there's a better way of doing it rather
22 than having this team making these phone calls and looking at
23 these paper printouts to see if there's some way that
24 technology can be brought to bear well in advance of the
25 schedule contemplated by the Council currently.
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1 THE COURT: So the issue, Judge Jones, is whether
2 there can be some acceleration in this fix problem, in this fix
3 scheme.
4 MS. JONES: Well, as I said, I think the job closed
5 box is going to take us a long way. In addition, as I know
6 your Honor knows, we are going to --
7 THE COURT: Hire?
8 MS. JONES: Well, yes, we're going to hire, but I was
9 about to say our EST Pro Tem and our EST Elect are committed to
10 going to the delegate body and recommend a hire, and we'll have
11 it. And I can't overstate the value that we have in our use of
12 Charles Jackson.
13 THE COURT: Is that Benefit Funds?
14 MS. JONES: From the Funds. But he's been there a
15 very long time, and he's been extraordinarily helpful, and he's
16 been working with Segal.
17 Believe me, if we can think of anything else quickly
18 with the help of Segal and our own IT person to have less
19 reliance on our business reps making these phone calls and our
20 electronic reporting people working with them, we will do it.
21 I think the job closed box should be very helpful, but I say,
22 again, our numbers are reliable and we're complying.
23 THE COURT: On my agenda the amendment to the
24 stipulation order proposed, let's hear a little bit about that.
25 MR. WALSH: As I lay out in the letter that I did
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1 write to the Court over a week ago, the local union, the eight
2 local unions --
3 THE COURT: We have taken care of the local problem.
4 MR. WALSH: Well, in sum and substance they have been
5 compliant with the stipulation order and federal law under 29
6 USC 501.
7 I think there's a distinction between the locals and
8 the Council not with respect to compliance but right now I am
9 getting notice of expenditures simply as a CC on emails to the
10 delegate body. So I don't really think it accomplishes
11 anything terms of us being able to assess where the District
12 Council is by saying we'll take the RO off the CC on the email,
13 it doesn't accomplish anything.
14 So what I would like to talk about with counsel for
15 the union is a more meaningful way of assigning responsibility
16 and placing it with the District Council and being able to, on
17 a periodic basis, dive in and see how that's going. Because I
18 do want to see the District Council take responsibility for its
19 affairs, but simply removing the prior notice on the
20 expenditures is not going to be an adequate test. So that's
21 the discussion that I want to have.
22 THE COURT: That's ongoing.
23 MR. WALSH: Yes, Judge Jones and I and Jim Murphy talk
24 a couple of times a week at the union.
25 THE COURT: Anybody else want to comment on that?
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1 Actually I think that's it for my agenda. Does
2 anybody want to raise anything else?
3 No?
4 MS. JONES: Well, your Honor, Kevin Segal from --
5 sorry, Kevin Wolf from Segal is here, and I wanted to let your
6 Honor know that he is available. I don't think that you have
7 any questions for him.
8 THE COURT: I don't.
9 MS. JONES: Thank you.
10 THE COURT: I don't at this time. And it may be in
11 your letter, I know you discussed the topic, when do you think
12 the in-house person -- by the way, I'm not trying to rush it
13 and get the wrong person, I'm trying to speed it up and get the
14 right person.
15 MS. JONES: I have spoken with not just the leadership
16 but our operations director. We're hoping that -- we have a
17 job description. Once we have the approval from the delegate
18 body, it will go out. We hope that we can interview relatively
19 quickly, as we did for the IT consultant.
20 THE COURT: That gets posted?
21 MS. JONES: We haven't exactly decided how, but I
22 assume it will be advertised and posted. And then if we can do
23 it, we would like to try to hire someone by March 1st.
24 MR. WALSH: Judge, a footnote on the whole question of
25 making electronic all reporting, the District Council either
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1 has to get more tablets paid for by the District Council or
2 going back to the labor management fund and seeing if they will
3 pay for some more. But in the absence of that cooperation from
4 the LM fund, it seems to me the counsel is on the hook for
5 having to devise some means for the stewards to enter this time
6 electronically, whether on some PC at job site, a home PC, or
7 being provided with an application for cell phones, or buying
8 more tablets out of District Council funds. But that is
9 something that I do not have a solid answer on, and I have been
10 pushing the Council. I want to reemphasize the vital
11 importance of the Council coming up with a target being for
12 being a hundred percent electronic.
13 MS. JONES: Judge, we estimate we may need 250 to 300
14 more tablets.
15 THE COURT: What's the universe now?
16 MS. JONES: I think we have 800 -- we have a thousand,
17 and almost all of them are out, and the hope is that we will be
18 able to get that money from labor management.
19 In terms of the deadline for going paperless, I cannot
20 give you one, but I can give you an update of what we have done
21 so far.
22 THE COURT: You could give me an estimate, too, of
23 when you think you will be there. So you will have to buy the
24 tablets first or some alternative.
25 MS. JONES: Right, or some alternative. And we'll
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1 also be able, we think, to reclaim some tablets, but the first
2 thing is to get a large number of tablets, which we can do.
3 THE COURT: That shouldn't be a big deal.
4 MS. JONES: I don't think so. I think configuring
5 them takes a little while, but we should be able to get them.
6 Then we have discovered a large number of our stewards
7 are using their own cell phones. They have a portal they can
8 report directly in. We're considering having them return the
9 tablets they're not using so that we can change those out.
10 THE COURT: Because the cell phone works equally?
11 MS. JONES: It does. As long as you go into the
12 portal you're communicating electronically with Watchdog just
13 as if you had the tablet. Maybe going forward there will be
14 easier and less expensive ways for the electronic reporting to
15 be done, but right now for the moment our concern is to get
16 more tablets. So as we go forward converting, I would say it's
17 35 percent. We probably have 65 percent electronic right now.
18 THE COURT: So it's another 35 percent?
19 MS. JONES: It's another 35 percent.
20 THE COURT: And your target date?
21 MS. JONES: Well, I think within the next month we'll
22 have an answer about whether or not, and probably sooner, we
23 can have our hours from the Javits Center, which I think is
24 about 460,000 hours, electronically transmitted to us. That
25 would be a terrific advantage.
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1 In addition, there is an association, which are the
2 independent outside associations, and they have over a million
3 hours. These are all jobs where we have stewards, many of whom
4 already have a tablet, they're used to reporting when they work
5 on CBA Court-ordered jobs, and we think we can convert them
6 very quickly. And I could say a month, I don't know, I don't
7 know if that's true. But we're targeting them and targeting
8 Javits.
9 And we had a conversation with the General Contractors
10 Association. They have an understanding and agreement with us
11 to cooperate in electronic reporting. And we are going to
12 begin to lay out a program with them for the dock builders
13 agreement, which is one of the three GCA agreements that we
14 have. And with the dock builders, there are large jobs that we
15 can probably target pretty quickly and use tablets on it. One
16 of them that Mr. Walsh mentioned some time ago as a good target
17 was the Tappan Zee Bridge. Unfortunately they are on hold, I
18 guess because of the weather. But we're looking for other
19 large jobs, we're doing it with the GCA as executive director.
20 We're going to talk more next week, and we would like to start
21 getting them tablets and working.
22 We also have a protocol that Mr. Walsh is still
23 considering relating to the dock builders that would permit
24 telephone reporting with some of the dock builders. I think
25 ultimately we would want all tablet or electronic reporting.
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1 And that's easier when you have a lot of workers and it's sort
2 of a stable job, it's going to be there for a while, and you
3 can get a steward. There are other times with the dock
4 builders it's more difficult because of the numbers of
5 different jobs they go to, the smaller sizes, a lot of the
6 variables. But we're working on a protocol that Mr. Walsh
7 suggested where, with some of the dock builders, we might use
8 telephone reporting. Reporting all the same, but telephone
9 reporting.
10 So those are our three initiatives at the moment, and
11 it would be at least a million and a half just with Javits and
12 the independent outside. And I think with respect to the
13 general contractors, I don't know whether that's two-thirds or
14 one-third of their over two million, but that's another
15 significant chunk.
16 Once we accomplish that, we can start to go after some
17 of the smaller associations in the sense of smaller hours.
18 THE COURT: Okay. So I think that about wraps up.
19 Does the government want to add anything or comment on
20 any of these issues?
21 MS. LaMORTE: No, thank you, your Honor.
22 THE COURT: How about the ESTs, current or incoming,
23 do you want to comment on anything that we discussed here
24 today?
25 MR. GEIGER: Not at this time, your Honor.
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1 THE COURT: All right. Then I think it would be
2 worthwhile -- and incidentally, I don't think that we need to
3 meet every month, but I think a meeting in March would be
4 helpful because there would be some milestones that may have
5 been passed, and I think, if you wouldn't mind, let me propose
6 a date.
7 Can you all do March 10 at -- that's a Monday, at
8 noon, would that work?
9 MR. WALSH: Yes.
10 MS. JONES: Yes, your Honor.
11 MR. MURPHY: Yes.
12 THE COURT: I think there's some advantage of having
13 that meeting for sure to get updated on some of the issues that
14 we have talked about today.
15 Okay. Thanks. Nice to see you all.
16 MS. JONES: Thank you, your Honor.
17 MS. LaMORTE: Thank you, your Honor.
18 o0o
19
20
21
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