GE Appliances union has financial problems, new president says - WDRB 41 Louisville News

GE Appliances union has financial problems, new president says

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GE Appliance Park workers on a washer line in November 2016. GE Appliance Park workers on a washer line in November 2016.
Members of IUE-CWA Local 761 rallied ahead of previous contract negotiations in May 2015. Dana Crittendon, center, was the union's president at the time. Members of IUE-CWA Local 761 rallied ahead of previous contract negotiations in May 2015. Dana Crittendon, center, was the union's president at the time.

LOUISVILLE, Ky. (WDRB) --  The new president of the union representing workers at GE Appliance Park said his group is working to shore up the organization’s finances after previous leaders spent too much money and failed to properly account for expenses.

The financial problems have put IUE-CWA Local 83-761 “under the microscope” of national union leaders, according to an internal memo from Brian Caudill, who was elected president of local union on Oct. 24.

In fact, a recent audit of Local 761 found issues serious enough to establish grounds for the national Communication Workers of America to take over the chapter, though that has not happened, Caudill wrote in the memo dated Monday, a copy of which was obtained by WDRB News.

Local 761 represents about 3,600 rank-and-file workers who make dishwashers, refrigerators and other products at the massive appliance factory in southeast Louisville.

Caudill, who was among an all-new slate of leaders elected in October, declined an interview, saying the finances are “an internal issue” that local and national union leaders are addressing.

Among the problems, he said in the memo, are that the previous leaders spent too much of the union’s money on “lost time,” or the wages of GE Appliances employees who were on leave from factory work so they could handle union business.

The union also failed to properly document those “lost time” expenses, and a dozen checks bounced because of poor cash management, Caudill said in the memo.

“These issues were created by bad choices, nothing more,” Caudill said in the memo.

Other issues included the lack of an annual budget and an independent audit, and payments to union stewards despite their not signing meeting attendance sheets, according to the memo.

But Dana Crittendon, the previous local union president, said in an interview that the financial problems are overblown and part of a narrative pushed by “a small group of people that have been attacking me and my administration since Day One.”

Crittendon, a health and safety specialist at GE Appliances, did not run for reelection after leading the union since 2014, he said.

He said the recent audit found “small, petty things” that the union had been doing long before his tenure and that do not amount to serious problems.

For example, the union has never had an annual budget, he said -- but any expenses over $2,000 had to be approved by the members.

Crittendon acknowledged that checks bounced, but he said that was because funds were spread over accounts at multiple banks, not for lack of money.

The local union’s most recent annual financial disclosure required by federal law shows its net assets grew to $1.5 million – including $1.1 million in cash -- as of Sep. 30, 2016, up from $1.3 million a year earlier.

Local 761 brought in nearly $1 million – almost all of it from members’ dues -- during the year ended Sept. 30, 2016, while spending about $770,000 during the year, according to federally required disclosure.

Crittendon said that financial form was prepared by Blue & Co., a certified public accounting firm that handled the union’s books.

However the union had no audit or review of its books and records by an outside accountant or parent organization during the year, according to the federal form.

The financial problems come at a tumultuous time for the union and its workers, who are still adjusting to life under Appliance Park’s new owner, Haier Group of China.

Haier bought Louisville-based GE Appliances from General Electric Co. in 2016. The company soon extracted a number of money-saving concessions from the union in a new labor contract.

Under Haier, GE Appliances  also decided to stop producing the GeoSpring hybrid-electric water heater because of low sales, and to follow through with a plan to outsource its finished-product warehouse operation to a third-party, displacing about 200 union-represented warehouse workers.

GE Appliances also shifted production of a hotel-room air conditioner from Appliance Park to a factory in Tennessee.

Despite those issues, Crittendon said, “our biggest problem right now is fighting among ourselves.”

Caudill's letter is below:

Reach reporter Chris Otts at 502-585-0822, cotts@wdrb.com, on Twitter or on Facebook. Copyright 2017 WDRB News. All rights reserved.

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