Call it niche marketing, call it building the labor movement. Union Friendly Systems Inc., a company based first in Los Angeles and now in Madison Heights, shaped a reputation and a solid clientele by writing software packages and building computers for local unions. By providing lots of tech support for labor leaders who wanted to bring their offices into the modern era, Union Friendly created loyal customers, delighted to buy from a union shop. This fall, the company’s new owner appeared ready to chuck all that goodwill. Union Friendly, which had about 55 employees at the time, began buying computers from a nonunion supplier, slapping the union label on, and reselling them as “union-made.” What’s more, management began attacking the on-site union in Madison Heights, UAW Local 889. According to local members, in the last two months management has violated their union contract repeatedly, prompting concerned letters from the Detroit and Wisconsin AFL-CIOs. Health insurance was unilaterally canceled and union officers were laid off.
“People here are feeling that we’re screwing our reputation with the unions, that we’re hurting ourselves,” says union steward Paul Hensley, a tech support worker at the company. “They are shooting themselves in the foot by not taking care of their core customers, which is the unions,” says an employee who asked that his name not be used (“I’ll be out of a job,” he insisted). “That’s what Union Friendly was founded for,” says the employee. “That was the idea.”
When owner Frank Scaramuzzino was contacted for his reaction to employees’ charges, Scaramuzzino first replied, through his attorney, that he would meet with Metro Times only if our sources were also present, along with a representative of the union. After the paper rejected that condition, he and other company officials refused to respond to repeated faxes, phone calls and e-mails to him and to other members of management.
Union Friendly was launched in Los Angeles in 1984 by computer professionals Richard Van Elgort and Bill Wojtalik. Van Elgort had written a software package for a teachers union to help track membership, dues and grievances. He liked the idea, he says, of “using my talents for organizations that were trying to help other people.” As unions bought the specially tailored software, they asked what computers to run it on. Van Elgort decided he might as well start building computers himself, with a unionized workforce, and invited the Communications Workers of America to organize the shop. “We understood what the unions’ needs were,” Van Elgort says. “Sometimes someone would have just taken over as union president, and yesterday they were driving a truck or digging a ditch. So it called for more patience on our end.”
Brandon Weber ran Union Friendly’s Midwest operations single-handedly until 1997. He had been president of a steelworkers local in Kansas City before falling in love with pixels and bytes. Of the tiny staff at that time, which did sales, setups and tech support, Weber says, “We understood unions because a lot of us had been members or officers or stewards. I’m a computer geek but I also love unions.
“Unions need this kind of stuff more than anybody because corporations are using technology to kick their asses, and we can fight back if we have the technology too. Unions don’t get this kind of help from anybody — not from computer stores, not from geeks, not from techies, so they need to get it from someone who understands labor.”
Weber — who on Sept. 18 was laid off with the rest of the six-person sales force — remembers that Union Friendly would donate computers for gatherings such as the Midwest Labor Press Association. He would volunteer his time to demonstrate publishing software to union newspaper editors — and the company would gain invaluable publicity and goodwill.
“We did a lot of hand-holding, a lot of personal contact,” he says. “If they bought a computer we’d be happy to show them how to use it, we wouldn’t charge them.”
Flush with success
Then success caught up with Union Friendly: the company landed a contract bigger than it could handle. The job, estimated by a knowledgeable employee to be worth as much as $35 million, was for the joint UAW-DaimlerChrysler Training Center, to build home computers that would be provided at very low cost to DC’s union employees.
With orders eventually topping 34,000, Union Friendly opened a plant in Madison Heights to carry out the assembly work, but then sold out to a local Internet service provider called Bignet in October 2000. As part of the purchase agreement, Bignet accepted both the union contract and the existing employees.
Employees say that Bignet was not hostile to unions, but it was incompetent. The water was shut off, debt was called in by the banks. Management deducted dues and initiation fees from UAW members’ checks but failed to forward them to the local, eventually stiffing the union some $10,000, Local 889 President Tom Wright told his members during a meeting.
So when Frank Scaramuzzino owner of a Madison Heights company called Premier Auto Workers, announced to the workforce in July that he’d bought Union Friendly, the workers applauded. Scaramuzzino had worked with both unions and management before, preparing safety information for posting in workplaces.
But after the sale, employees barely saw the new owner. On Sept. 4, salespeople found their cell phones — which they needed to make and receive calls from customers —shut off. Two weeks later, management began contracting out customers’ over-the-phone tech support to a nonunion company.
The union label?
Most disturbing, in September employees discovered that management was contracting the assembly and testing of PCs to nonunion computer maker Dell and to Stone Computer’s nonunion plant in Toledo. Although Union Friendly employees affixed labels that read “Union Assembled in Detroit, Michigan/UAW Local 889” to these PCs, Union Friendly was no longer union-made. “We weren’t building machines, we were repackaging them,” says Paul Hensley.
Tech support rep Dawn Mize says she only became aware that management was passing off Dell computers as its own when she was trying to help a DaimlerChrysler worker, over the phone, with his new computer. “He said, ‘No, that’s not what the back of my computer looks like. No, that’s not what the front of my computer looks like.’
“I put him on hold and asked the distribution manager if there was a different style of case we were using for the tower, and he said they were getting them somewhere else.
“I remember being so mad. I said, ‘Wouldn’t it be nice for you to tell us so we won’t sound like idiots when we’re talking to customers on the phone?’”
Rebecca Monahan was Union Friendly’s liaison with the UAW-DaimlerChrysler Training Center. She helped prepare the company’s new building in Madison Heights. “I picked out the carpet and the paint,” she remembers. “I took care of the vendors. I had DaimlerChrysler shop stewards calling me continuously on my cell phone even after I was laid off, because I would take care of their problems.” But Monahan was laid off along with the rest of the sales force, with no notice, told to clear her desk within the hour.
She believes one of the reasons was that “I didn’t cut corners, I wanted to get the best computers possible. Frank knew my stand on the computers. I was looking to give the UAW exactly what they purchased. So when I was left out of meetings, I knew something was going on.
“They knew I would not support them on switching computers. The computers they switched to had what they were supposed to have, but the quality was not even close to the ones we built. It was about a week before I was laid off that I discovered they had begun switching computers.” Monahan said she is preparing a suit against the company over her termination.
On Nov. 20 John Smith discovered that management was contracting out not only the DaimlerChrysler computers but construction of the custom-built units as well — the company’s former base of support. “There are customers that want Union Friendly computers, and management outsourced that work to Stone without talking to the people in the shop,” says Smith. “You only find things out here by keeping your ears open.”
Besides the truth-in-labeling questions, employees say the shop has become a downright union-unfriendly place to work, alleging blatant violations of both the union contract and labor law. Dawn Mize was fired, she says, after management decided to target her because she filed grievances.
On Sept. 18 management, represented by attorney Mary Mahoney, laid off the entire sales staff, including the union shop steward and unit chair. Many union contracts give “superseniority” to such shop floor officials, so that management can’t deny workers the representatives of their choice by laying them off. After union officers protested that they could exercise their superseniority and “bumping rights” to take different jobs within the shop, management allegedly threatened to hold an election to select replacement officers (a violation of federal labor law). However, Scaramuzzino eventually relented and allowed the laid-off leaders their bumping rights.
Crossing the line
The terminations did not go unnoticed by Union Friendly’s customers. Deanna Busalacchi-Zabel, communications director of the Wisconsin State AFL-CIO, wrote to manager Adam Heeter: “You should know that your sales staff … bring sales and customer service at a whole new level, and I for one have recommended UFSI to many people in the union movement as a result. However, due to the current situation with your company, that will not be an issue anymore. … As a member of the labor movement, I am embarrassed at the tenacity of your management. Union busting, outsourcing work and refusing to pay benefits should not be tolerated, and I presume will not be by UAW Local 889.
“I expect that these tactics can only backfire in the success of the company. Getting the reputation back that UFSI once had will be difficult. … I hope that you will work with Local 889 instead of against them.”
Noting that “Your business has benefited from the association with organized labor,” Donald Boggs, president of Detroit’s Central Labor Council, called the layoffs “cause for alarm.” Boggs offered to help the company advertise itself on Web pages that promote union-built products, and asked management to reinstate the sales staff. Employees discovered another serious contract violation in September. When a worker took her daughter to the emergency room with a broken arm, she says, it was discovered that Union Friendly had not paid insurance premiums. A grievance documenting allegations of noncoverage was filed. Despite repeated promises that insurance would be reinstated, employees went without coverage until Dec. 1.
Says single mother Dawn Mize, “My daughter had eye surgery, and I got a bill from the hospital for $4,400. Somebody is going to have to pay that and it’s not going to be me.”
On Sept. 26 Adam Heeter and director of operations John McDermott called the workforce together to tell them they would no longer receive paid lunch breaks, a move workers perceived to be in retaliation for the union’s filing numerous grievances over alleged contract violations. In addition to the health insurance issue, the grievances included allegations of improper subcontracting and the company’s refusal to pay for vacation time.
According to two employees who attended the meeting, Heeter allegedly warned workers that more grievances could result in the elimination of paid breaks.
Employees left the meeting feeling Heeter’s message was clear: The future of the union at Union Friendly is uncertain.
On Nov. 27 the secretaries union at the UAW-DaimlerChrysler Training Center went on strike. Union Friendly had been trucking their Stone and Dell computers to the center, where they would then be shipped out to individual DaimlerChrysler workers. (By this time management had stopped re-labeling the computers as union-made.) McDermott asked production workers if they would cross the secretaries’ picket line to put shipping labels on the computers. No one volunteered — so Union Friendly managers said they would cross the union picket line themselves.Jane Slaughter writes about labor issues for Metro Times. E-mail [email protected]