An Illinois state senator’s recent not-guilty plea to federal charges of embezzlement has put a new focus on a long-running dispute between a Chicago construction industry union and the leadership of the Chicago Teamsters Joint Council 25, a powerful, overarching organization of 25 Teamsters locals in northwest Indiana and Chicago that represents more than 100,000 workers.
On Aug. 18, State Sen. Tom Cullerton (D-Villa Park, Ill.) pleaded not guilty to 39 counts of embezzlement, one count of conspiracy and one count of making false statements in response to federal grand jury charges of ghost-payrolling as a Teamsters organizer.
According to the indictment, Cullerton did little or no union organizing work for Joint Council 25 during the time he was employed as such, yet still received bonuses and regular paychecks from the council. The indictment cites several alleged instances of Cullerton being paid by the union for organizing work performed while the state senate was in session and he was in the legislature at the capital in Springfield.
Cullerton was hired for the organizing work by the former head of Joint Council 25, John Coli, Sr., who is a key figure in a dispute between the Joint Council and Chicago-based Teamsters Local 786, which represents 1,400 ready-mix concrete and dump truck owner-operators. Before his election to the state senate in 2012, Cullerton was a member of a teamster local who drove a delivery truck for Hostess but lost that job after his election.
Coli has reportedly been cooperating with federal prosecutors since he entered guilty pleas last July to charges involving a scheme to extort money from Cinespace Studios, a Chicago television studio. He left the Joint Council in July 2017, around the time indictment was handed down.
Now a former president of Local 786, Anthony Pinelli, who also is an attorney, is hoping Coli’s cooperation with prosecutors and Cullerton’s indictment will help shed new light on a dispute between Local 786 and Terrence Hancock, a former Coli ally who replaced Coli as president of Joint Council 25, and rolls up to the national leadership of the Teamsters.
Pinelli alleges that Hancock engineered the removal of Local 786’s leadership in a bid to grab control of Chicago’s lucrative ready-mix concrete contracts.
Hoffa Removes Local's Leaders
In July, Local 786 received a letter from Teamsters’ General President James P. Hoffa, in which Hoffa removed the local’s leadership team and replaced it with a trustee.
The removal followed a notice in March from Hoffa, who told Local 786 leaders that he had received “credible allegations” that they had failed to enforce collective-bargaining agreements, and had undercut wages and benefits for other Chicago-area Teamster locals.
That letter was followed by a hearing Hoffa called in April, during which five other Chicago-area Teamsters locals charged that Local 786 entered into substandard contracts governing road construction. More than 500 Teamsters attended.
Leaders of the complaining unions said Local 786 undermined them. According to a hearing transcript, they said Local 786 sought to increase its membership by offering owner-operators of trucks arrangements where they did not have to pay into pension plans and other union funds. As a result, there was a decline in industry standards and a loss of dues-paying members, leaders of the five locals said.
Pinelli says the July removals are part of a years-long attempt by Hancock to take over 786. He says Hoffa’s letter was retaliation for Local 786’s refusal to merge with Local 731, a 6,200-member union that represents excavator operators and ironworkers, among others.
Unsuccessful Merger Talks
Hancock, a close ally of Hoffa, was president of Local 731 before his ascension to leadership of Joint Council 25. Unsuccessful merger talks between 786 and 731 were held last year while Coli was still Joint Council 25’s president and Hancock was its vice president.
“Terry Hancock always wanted to have all of the construction,” says Pinelli. “The ready-mix [contract] is the crown jewel. The wage rates are better than what his excavators make." Pinelli adds that "we've got really smart trustees [in Local 786]. They've done a great job. That's why we're over 100% funded, and have been able to increase benefits in the last two contracts.”
Local 786’s executive board had unanimously rejected the merger last February. Pinelli, then vice president of Local 786 under President Michael Yauger, sent an email to Hoffa and other union officials at the time explaining the chapter’s reasoning: “A labor organization that has existed for more than 80 years, has the best ready-mix contracts in the country, and has built model benefit funds … is being asked to just turn out the lights and walk away on its members under threats of punishment.”
Yauger told Hoffa after the hearing that it was “no secret that allegations against this local” have been made by Hancock. He asked Hoffa to investigate Hancock for allegedly violating the Teamsters’ constitution. “We have not acted in any way to harm or injure the Local 786 Trust Funds or our members’ benefits,” Yauger wrote. “The allegations of dishonest conduct are all part of the grand scheme by Joint Council 25 to be in charge of all construction and material supply.”
Yauger retired from the union shortly after sending the letter to Hoffa. Pinelli succeeded him as president and vehemently denies allegations that any Local 786 contracts were substandard. He says that any problems with Local 786’s members getting work now is the result of meddling by Hancock’s Joint Council 25.
He also says comparing compensation rates for ready-mix and dump truck owner-operator union members with excavator operators, who do not own their own equipment, is a faulty comparison.
“Watching Hancock rise through the Joint Council, [when] he became the construction coordinator we all of a sudden had problems,” Pinelli says. “’Our contracts are no good, our operators are no good, you can't work here, you can't work there.’ "
He adds, "So, it continued and continued until John Coli was helping him [Hancock] with what he was doing with us. And the charges he filed about new contracts where our rates were higher than theirs? That was because their rates or contracts are substandard. The owner-operators, for the most part, don't pay pension and welfare on themselves because they don't make enough money.”
Pinelli says he plans to file lawsuits to try to get the leadership of Local 786 reinstated and to remove the officers now in charge of Joint Council 25 and replace them with an independent trustee in the wake of the federal charges against both Coli and Cullerton.
“John Coli can still take the Fifth Amendment on just about anything regarding his work and I can’t believe that the government or his lawyer would allow him to testify about anything relating to Joint Council 25 that could be helpful to us, since his sentencing [after pleading guilty in the Cinespace Studios case] has now been continued indefinitely,” Pinelli said. “It’s enticing, but I haven’t thought about it much for those reasons.”
Hancock did not return calls seeking comment for this story.