Labor leaders among highest paid officials in Hawai'i

By Frank Cho
Advertiser Staff Writer

Last year, more than a dozen labor union leaders in Hawai'i took home six-figure salaries — double the number who did five years ago.

From start to finish in the S-shape, labor leaders Russell Okata, Tony Rutledge, Ron Takata, Gary Rodrigues, Lynn Kinney, Herbert Kaopua, Karen Ginoza, Melvin Kahele, Michael Nouchi and Eric Gill all had six-figure incomes last year. Advertiser library photos

The filings show that as Hawai'i's economy has slowed since the late 1980s and early 1990s, union leaders' salaries have not increased as fast as they used to. Still, many last year grew faster than the state's 1.7 percent rate of inflation. On average, local labor leaders saw pay increases ranging from about 2 percent to 7 percent last year compared with 1999.

The increases are generally in line with union leaders' pay increases on the Mainland. And labor leaders justify the pay, saying they work long hours in a complex and stressful environment. They say many work six or seven days a week and take few vacations.

"A union leader today is not the same as yesterday when they just had to handle grievances," said Kinney, leader of District Council 50, an umbrella group of several Hawai'i trade unions. "Sometimes we have to be a minister, sometimes we have to be well-versed in welfare benefits. You have to be everything to everyone."

But while local union leaders' salaries generally had modest increases last year, and still are small compared with some of Hawai'i's top CEOs — who can easily earn $1 million or more a year — they still seem surprisingly high to some union watchers.

In federal filings, nine of the unions' top leaders took home six-figure salaries last year. When other compensation is added, and when leaders' top lieutenants are included, that number rises to more than a dozen.

"It's a sign that there is a real political machine operating in the unions there," said Carl Biers, executive director for the Association for Union Democracy based in New York.

Despite falling membership and recent challenges to some union leaders at the ballot box and in the federal courts, Hawai'i remains one of the most heavily unionized states in the nation — second only to New York.

Another major reason some union leaders have been able to increase their salaries over the years is that it is often hard for members to find out what their leaders are being paid, Biers said.

Most Hawai'i union leaders negotiate their salaries with a union's executive board. Sometimes it's tied to what the members earn, but many times it's not.

And until recently, the only way for members to find out how much their leaders were being paid was to visit or write the U.S. Labor Department and request a copy of the financial report that every union must file annually.

The LM-2 form gives some information about that union leader's salary, but it also may be necessary to track down an array of LM-2s to get the whole picture because union officials may be paid as president of a local, executive with the parent union, as director of an umbrella group, or by all three.

For example, to calculate the salary for Tony Rutledge, former head of the 10,000-member Hotel Employees and Restaurant Employees International Union Local 5, AFL-CIO, union members would find in the annual report that Rutledge was paid $40,380 last year before he lost his bid for re-election that April. The report also shows that Rutledge took a one-time severance payment of $86,948 from the union's pension, boosting his pay to $127,328 that year.

Rutledge also served as vice president with the Local 5's parent union, earning another $10,000 that raised his total income to $137,328 for the year.

And gross salary can be only part of the compensation union leaders receive. Some union leaders receive thousands of dollars in compensation for expenses, allowances and other payments above their normal salary, according to the unions' financial reports.

In 1999, longtime labor leader Gary Rodrigues, state director of the United Public Workers Local 646, received more than $53,000 in addition to his $113,000 salary, mostly in payments for unused vacation time that year.

Jerry Ahue, president of the Communications Workers AFL-CIO Local 14921, had a base salary of $96,202 last year, but received an additional 10.5 percent in allowances and other payments for total compensation of $107,535.

The filings also show that some of the highest-paid union leaders in the state are not necessarily those that lead the largest unions.

Eusebio Lapenia, president of Hawaii's biggest union — the International Longshore and Warehouse Union Local 142 with more than 20,000 members — earned $63,444 in 1999.

Before he died in 1999, Carpenters union leader Walter Kupau sat among Hawai'i's highest-paid people, earning well over $300,000 a year for running his 6,000-member union — significantly more than even James Hoffa, head of the 1.3-million-member International Brotherhood of Teamsters, who earned $262,200 last year.

The UPW's Rodrigues said public-sector union leaders typically lead much bigger unions and face more complex issues than their private-sector cousins.

"But those guys make the big money. Private-sector trade unions always spend nearly all the money on union salaries," Rodrigues said.

At the United Public Workers union, about 2.3 percent of the members' dues collected last year went to pay Rodrigues' salary.

Public-employee unions, except for the United Public Workers, which represents both private and public workers, are not required to disclose their leaders' salaries to the Labor Department, but several of them did to The Advertiser for this report.

Ron Taketa, who now heads the influential Carpenters Union Local 745, ranked second among the highest-paid with a gross salary of $187,030, but that represented only 3.7 percent of the $5 million in dues collected from the union's members last year. A member of Taketa's union earns about $59,000 a year on average.

Members of the Iron Workers Local 625 used 44 percent of their dues in 2000 to cover Clyde Eugenio's gross salary of $89,464 as financial secretary and business manager. Elevator workers paid 53 percent of their dues to cover Thaddeus Tomei's $97,756 gross salary last year as head of the 204-member Elevator Constructors Local 125, AFL-CIO.

"The high salaries usually reflect not a lot of involvement by members," Biers said. "Unions where members are a lot more involved in the process tend to have lower salaries."

Union leaders' pay remains a delicate subject at union meetings and conventions. Most union officials decline to talk about it.

Nationwide, teamsters upset about so many of their leaders around the country collecting high pay have created a group called Teamsters for a Democratic Union that has begun collecting annual reports for every teamster local and posting every leader who earns more than $100,000 a year on its Web site.

The Labor Department has also tried to make it easier to obtain union annual reports by requesting them through the Internet at www.dol.gov/dol/esa/public/regs/compliance/olms/rrlo/orderf.htm.

Other disgruntled union members around the country have asked the AFL-CIO to publish guidelines on how much union leaders should earn. But union leaders note the subjectiveness of determining compensation for leaders in the top spots, noting that the value a leader can bring through influence and knowledge is difficult to quantify.

Still, Biers said there is irony that in a union — where people become leaders because they are interested in raising their members' income — some seem more interested in raising their own.

"It's so contrary to the principles of unionism," Biers said.

Correction: A previous version of a chart with this story incorrectly stated the 1999 gross salary for Eric Gill of the Hotel Employees and Restaurant Employees Local 5. Gill was not employed by Local 5 in 1999.