HOTEL WORKERS' UNION, U.S. REACH OVERSIGHT ACCORD
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Former Governor Thompson On Board
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(Chicago Tribune, Aug. 29, 1995)
[CN -- This story provides background for the one to follow.]
 
 
Nearly 20 years after the government began investigating the 
Hotel Employees and Restaurant Employees union, a deal between 
the government and union will give the hotel workers a chance to 
show how clean they are.
 
Union and government officials expect to sign a consent decree 
next week in federal court in Newark, N.J., that will allow a 
federal monitor to oversee union leaders' activities. A three 
person review board will replace the monitor after 18 months.
 
"This is anything but a takeover," insisted Robert Rotatori, the 
Cleveland attorney who handled the union's negotiations with the 
government, which, he said, have been under way for two years.
 
In a letter sent Monday to the rank and file, union leaders 
emphasized that they will remain in power. The deal does not cite 
wrongdoing by current leaders, they told reporters.
 
Under the agreement, the monitor will be able to make 
recommendations on cleaning up the union's ranks to the heads of 
the 330,000-member organization, Rotatori said.
 
The review board, which has already been chosen by the union and 
government, will have the power to oust union leaders, he added.
 
The board's members will be ex-Gov. James R. Thompson; Kurt 
Muellenberg, a former head of the Justice Department's organized 
crime and racketeering division; and Roman Catholic Archbishop 
James Kelleher of Kansas City.
 
The union, under Edward T. Hanley, has heavily supported 
politicians over the years, including Thompson. However, union 
officials said that the former Illinois governor had received 
only about $50,000 in contributions from the union.
 
Herman Benson, head of the Association for Union Democracy, an 
independent union watchdog group in Brooklyn, N.Y., said the 
agreement was "long overdue."
 
The chance of the union ridding itself of mob ties "without 
government intervention is remote," he added.
 
Rather than viewing the deal as a burden, Rotatori described it 
as a "final step" on the union's part to clear years of 
"allegations and perceptions" about corruption.
 
To be sure, the union, which has been led since 1973 by Hanley, 
68, a one-time bartender from Chicago's West Side who rose up in 
union ranks as a local leader in Chicago, has been repeatedly 
cited by federal investigators as one of the nation's more 
corrupt labor organizations.
 
A 1984 report by the U.S. Senate Permanent Committee on 
Investigations raised a number of allegations, among them that 
organized crime had "substantial influence" over the union and 
that the union's payroll was padded with friends, relatives and 
cronies of union leaders and people with mob ties.
 
Appearing before the committee, Hanley refused to answer all of 
its questions, pleading the 5th Amendment 86 times. Hanley has 
steadily denied allegations of mob influence and has never been 
charged with a crime.
 
John Gibson, the union's former secretary-treasurer, was found 
guilty in 1980 of misuse of union funds and served a brief prison 
term.
 
He still receives $83,000 a year from the union, which Monday 
described the sum as retirement pay. Union officials in 1984, 
however, told Senate investigators that Gibson and other former 
union leaders receive lifetime salaries as consultants.
 
A series of articles in the Tribune in 1977 noted that Hanley had 
hiked his salary to the third highest among the nation's union 
leaders, $100,000 at the time, and handed union jobs to 
relatives, alleged mob figures and union leaders with full-time 
jobs.
 
Hanley received $341,262 in salary and expenses in 1994 as 
president of the union and executive director of Local 1 in 
Chicago, according to records on file with the U.S. Labor 
Department.
 
Thomas Hanley, Hanley's son, received $303,182 in salary and 
expenses in 1994 as the union's director of organizing, 
secretary-treasurer of its Joint Board in Chicago and president 
of Local 1, union documents show.
 
In 1991 the government took over the union's 22,000-member local 
in Atlantic City, saying mob figures embezzled $20,000 a month 
from it. The federal control has since been lifted.