Case 1:90-cv-05722-RMB-THK Document 1434

Filed 11/25/13 Page 1 of 4

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK X UNITED STATES OF AMERICA, Plaintiff,

USW SON DOCk..)MENT 1Ltt) , ELLA:WOW/AWN r DOC ',h DATE FILEMil

90 Civ. 5722(RMB)

-agai nstDECISION & ORDER DISTRICT COUNCIL OF NEW YORK CITY and VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS and JOINERS OF AMERICA,et al., Defendants. X An (additional) conference in this matter is scheduled for December 4, 2013 at 9:30 a.m. The purpose of the conference is to further explore (and remedy)the delayed implementation of the anti-corruption "compliance procedures" called for in the recent collective bargaining agreements("CBA")between the District Council and the Wall-Ceiling and Carpentry Industries of New York, Inc., Building Contractors Association, General Contractors Association of New York, Floor Coverers Association, Contractors Association of New York, and the Cement League, respectively [Doc. # 1315, 1332, 1358, 1361, 1386, 1394, and 1426]. (Letter from James M. Murphy to Hon. Richard M. Berman, dated Feb. 13, 2013("Murphy Let."), at 1.) The Court remains concerned about the disturbingly slow pace of technology implementation, particularly because these matters have been pending since at least August 2012. Effective automated compliance, and assurances to the union membership and the Court that new technology had been tested, were integral to the Court's approval of a significant change in long-standing hiring procedures and the approval of"full mobility." (See Decision and Order, dated May 8, 2013, at 10 ("Integral to the CBA is full mobility and a computerized

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compliance program designed to protect against abuse and corruption in the workplace."); Hr'g Tr., dated Nov. 7,2011, at 5:13-15,6:17-23(MR.CONBOY [United Brotherhood of Carpenters]: One "crucial component[] in the overall part of the CBA with which the Court is concerned [is] anticorruption mechanisms that are hopefully going to be availing in terms of providing the critical protection to the funds, and that being of course the compilation of data and ultimately imposing a formal legal record accessible to all as to what hours were worked and what money is owed as of what date."); Murphy Let. at 2("In order to prevent corruption, the District Council and the [Association of Wall-Ceiling & Carpentry Industries of New York, Inc. ("WC&C")] have agreed to a number of provisions that will be codified in the parties' CBA to ensure compliance with all of the provisions of that agreement [including] Shop Stewards electronically reporting personnel and hours,"); see also Hr'g Tr., dated Feb. 27,2013 ("2/27/13 Tr."), at 39:4-7("MR. ROSEN [WC&C]: I would say .. . the full mobility and the accompanying [electronic] time reported is the lynchpin of the new [collective bargaining] agreement"); id. at 19,51:15-23("MR WALSH [Review Officer]: I believe the sooner we get the compliance program in place, the better. . It will I think lead to the elimination of

corruption as we know it . . . THE COURT: You're of the same view,[AUSA]Torrance? MR. TORRANCE: Yes."); Hr'g Tr., dated Dec, 19,2012, at 9:3-12("MR. WALSH:[The Executive Secretary Treasurer of the District Council "announced at the last delegate meeting that he was optimistic that the other associations would recognize that the wall-ceiling contract is the benchmark contract so that all of the other associations, rather than getting the give-backs of fifteen to twenty percent that they had requested would, in fact, have to meet the rate increases that the wall-ceiling association has given to the district council in exchange for full mobility with the caveat that there be a compliance program with the electronic entry of the time.").)

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The inclusion of the automated anti-corruption compliance program appears also to have been integral to obtaining support for the collective bargaining agreements. The rank and file members rejected all but one of the original versions of the CBAs in a mail-ballot-vote on March 27, 2012. (The Fourth Interim Report of the Review Officer, dated June 4, 2012.) "On August 22, 2012, the delegate body of the District Council . approved terms amending in significant

respects the [CBA] with the[WC&C]. . [I]n exchange for significant wage increases, the employers and the District Council [were required to] develop an appropriate compliance program and obtain an order from the Court ... to allow employers to select the District Council members who [would] work for them." (The Fifth Interim Report of the Review Officer, dated Dec. 3, 2012.) The Court(and the Union members) were also told early on that the anti-corruption /27/13 Tr. at 35:20-21 ("MR. technology had been tested and would be ready. (See 2 ANDRETTA [Standard Data]: I will say that the technology is complete, tested, and ready."); id. at 12:11-17("MR. MURPHY: There's been a trial [of the electronic reporting system] that's gone on for several months now involving six contractors. All reports are that the system does work."); id. at 34:18-35:2("THE COURT: So what is your estimate as to when this system [of electronic reporting] would be fully or likely to be [fully operational] -- what time period? MR. MURPHY: From what we're told by technology people, about the third week in March [2013]. THE COURT: Every job, every steward."),) It is troubling that, more recently, according to the District Council,"[e]xperience has also shown that the District Council's lack of an integrated information technology system has contributed to hurdles faced in executing and accurately analyzing the electronic reporting process." (Fifth Thirty-Day Report Regarding Electronic Job Reporting and Related Compliance

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Procedures, dated Nov. 15, 2013, at 4.) It is imperative that the parties forthwith come into compliance with the CBA provisions regarding electronic reporting of hours and upgrade the District Council's in-house staff and technological capabilities to comply with the Court's Orders, dated May 8,2013, June 11,2013, July 16, 2013, July 26,2013,September 3,2013, September 12, 2103 and October 23, 2013. The November 18, 2013 conference did not provide comfort that this was happening with sufficient urgency. The District Council is directed to secure the attendance of Standard Data representatives and other technology vendor representatives at the December 4, 2013 conference. Also, as discussed at the November 18, 2013 conference, the Benefit Funds(Ryk Tierney) are directed to provide the Court with written information on all ofthe costs (Le., advisory fees, commissions, legal fees, etc.) associated with managing the investments of the Funds on or before November 26, 2013. (See Hr'g Tr., dated Nov. 18, 2013, at 9:11-17.) Dated: New York, New York November 25, 2013 RICHARD M.BERMAN,U.S.D.J.