Palace Coup at the AFL-CIO

In a rebuke to Sweeney, activists hope to reshape the federation

In 1995, union leaders anxious about labor's decline kicked out AFL-CIO President Lane Kirkland and elected John J. Sweeney with a mandate to get the labor movement moving again. Now, in a sharp rebuke to Sweeney, a group of five union chiefs concerned that he hasn't made enough progress have pulled off something of a palace coup. On Feb. 27, after most of the press had left labor's annual winter gathering in Hollywood, Fla., the group quietly pushed through the creation of a new governing body to run the federation. The goal: to reinvigorate the AFL-CIO and refocus its agenda on recruitment and politics -- and ditch almost everything else.

It's a bid to fundamentally overhaul the house of labor by slashing the AFL-CIO's bureaucracy, orchestrating mergers of small unions, and mounting national recruitment drives (table). "Today's labor movement was invented in the 1950s and hasn't changed much since," says John W. Wilhelm, president of the Hotel Employees & Restaurant Employees union and one of those behind the new entity. "We need dramatic change. Every program of the AFL-CIO should be evaluated in terms of its contribution to organizing and politics."

The AFL-CIO's current governing body, the 54-member Executive Council, voted in the leaner structure despite protests from a handful of union leaders who would be excluded. The new group, called the Executive Committee, will meet monthly without staff and includes the heads of the 10 largest unions, plus seven others Sweeney chose. He's a member, too, with AFL-CIO Secretary-Treasurer Rich Trumka and Executive Vice-President Linda Chavez-Thompson.

Will a more powerful, slimmed-down AFL-CIO make a real difference in labor's fortunes? After all, Sweeney himself has been pushing many of the same ideas ever since he came to power, only to encounter resistance from unions that haven't mustered the will to change. The internal politics of the new committee could also prove divisive. Several union presidents say Sweeney, who ultimately endorsed the reorganization, feels threatened by the obvious challenge to his leadership.

The five union leaders who hatched the changes -- Sandra Feldman of the teachers union, Andy Stern of the service employees, Bruce Raynor of the needle trades, Terence M. O'Sullivan of the laborers, and Wilhelm -- began talking about the need for bold moves last year. But when they approached Sweeney several months ago, "he took it like a slap in the face," says one participant.

Sweeney only moved on the reorganization after meeting with the five union chiefs on Feb. 25, the first day of the Florida meeting. Even then, he didn't tell most other union leaders on the Executive Council -- who now stand to lose much of their power -- what was up until he proposed the new committee two days later. When asked by BusinessWeek about the new governing structure after the vote, he responded angrily, at first saying it had been his idea but then insisting it "will be advisory only." Still, the 10 largest unions represent two-thirds of the federation's membership, so they likely will call the shots. "This will let union presidents get more involved in decision-making, which is usually done beforehand" by the AFL-CIO staff, says Gerald W. McEntee, head of the American Federation of State, County & Municipal Employees.

If the new committee can truly remake the AFL-CIO, it would address a number of the criticisms union leaders have privately leveled at Sweeney for years. Like United Brotherhood of Carpenters President Douglas J. McCarron, who yanked his union out of the AFL-CIO in 2001 over many of the same issues, some labor leaders think Sweeney has built an expensive bureaucracy that hasn't put enough emphasis on hiking union membership. Indeed, the latest Bureau of Labor Statistics report, issued on Feb. 25, shows union membership at 13.2% of the U.S. workforce in 2002, down from 13.4% the year before. "The AFL-CIO can't afford to be everything to every union anymore; it needs to focus more on a growth strategy," says Stern, whose union, the Service Employees International Union (SEIU), has grown by some 200,000 members since he succeeded Sweeney as its president.

The real question, though, is whether organized labor is capable of reinventing itself, regardless of who is setting the agenda. Sweeney himself came to power by exhorting unions to focus their still-considerable resources on recruitment to offset labor's plummeting share of the workforce. But most unions have done little to follow his advice.

Some unions, such as Raynor's garment workers and Wilhelm's hotel workers, have radically reshaped their structures. Like the Carpenters and the SEIU under Stern, they have slashed bureaucracies and freed up staff and money for organizing, leading to major recruitment victories.

The problem is, that group includes only a half-dozen or so unions. Now, some of labor's most aggressive leaders will be on the new governing committee, including Wilhelm, Raynor, and O'Sullivan, whom Sweeney chose as representatives of smaller unions. If the new group can make tough decisions about how the labor movement operates, it may bring back some of the vigor that rippled through the house of labor when Sweeney first took office.

By Aaron Bernstein in Hollywood, Fla.

    Before it's here, it's on the Bloomberg Terminal.