House Committee Requests Probe Of Health Care Union’s Spending

NEW YORK — The House Committee on Education and the Workforce is calling for an investigation into “improper financial practices” by the union 1199SEIU United Healthcare Workers East, citing recent reporting by POLITICO.

In a letter Thursday to a top federal labor official, committee Chair Tim Walberg (R-Mich.) expressed concern about “numerous troubling allegations” detailed in POLITICO’s investigation, which found union President George Gresham has for years used the organization’s funds to benefit himself, his family and political allies.

“These allegations regarding 1199SEIU’s expenditures on lavish travel, nepotistic arrangements, unexplained payouts to political allies, and concerts or events that do not benefit rank-and-file members, raise serious questions about whether the union and its officers have violated the law,” Walberg wrote in the letter to Office of Labor-Management Standards Director Elisabeth Messenger.

The nine-month investigation drew on the union’s self-reported financial disclosures to the U.S. Department of Labor, as well as interviews with more than 20 current and former employees, internal records reviewed by POLITICO and public social media posts.

A Labor Department spokesperson previously told POLITICO that the Office of Labor-Management Standards does not confirm or deny the existence of ongoing investigations, but is aware of the recent reporting on 1199SEIU.

The attention from Congress deepens pressure on the union’s top officers to explain its use of funds, which come from monthly dues payments by 450,000 health care workers across five East Coast states. Those members are in the process of voting by mail in the union’s first competitive leadership election since 1989, and the slate running to oust Gresham cites his financial stewardship as a key reason why he should not be reelected. Ballots are due by April 30.

After POLITICO published its investigation last week, Gresham claimed in a written statement that the union’s fiscal officers and general counsel had “refuted” the article’s “allegations,” but said he plans to recommend an independent review.

“As the President of 1199SEIU, who is honored to represent the most essential workers in our nation, I take very seriously any claims about the abuse of their resources,” Gresham said in the statement. “I’m confident that this [review] will demonstrate the integrity with which we have always managed the resources entrusted to us by our remarkable members.”

Union spokesperson Bryn Lloyd-Bollard, who is running to be an officer on Gresham’s slate, said fiscal staffers are in the process of arranging an independent audit. He did not respond to questions about who would conduct the independent review and what it would cover.

A group of 13 union officers — all of whom are running on the slate to oust Gresham and his allies — chided him last week for refusing to meet with staff to discuss the “allegations of financial improprieties,” according to an email shared with POLITICO.

“As current officers of 1199SEIU, we are committed to ensuring that our members receive real answers,” the Members First Unity Slate wrote in a statement to POLITICO. “Transparency and accountability are non-negotiable — our members deserve nothing less.”

Hundreds of union employees joined a virtual staff meeting Thursday to discuss the reporting and how to answer members’ questions. Gresham and his second-in-command — Secretary-Treasurer Milly Silva — were invited but did not participate, according to two people who attended, who were granted anonymity to avoid reprisal for speaking publicly.

The call drew more than 500 staffers, even though employees in one large department were told by their supervisor that there was no staff meeting “because George or Milly have not called for one,” according to one of the attendees and an email reviewed by POLITICO.

It was spearheaded by senior executive vice president Yvonne Armstrong, who oversees the union’s long-term care division and is challenging Gresham for the presidency.

The union’s executive council — its highest governing body — was scheduled to meet the following day. The night before, a union administrator sent an emailed notice that the meeting was canceled but provided no explanation, according to a copy reviewed by POLITICO.

Lloyd-Bollard, the union spokesperson, did not respond to questions about the cancellation of the executive council meeting.

Lawrence Ukenye contributed to this report.