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When Unions Control Benefits, Employees Suffer

The officers represented by the Law Enforcement Employees Benevolent Association (LEEBA) weren’t aware their union president allegedly stole hundreds of thousands of dollars from their benefits fund until one of them tried to go fill a prescription at a pharmacy and was told their pharmaceutical benefit no longer existed.

After the FBI got involved, the union’s president, Kenneth Wynder, was arrested and charged with defrauding LEEBA members. The union’s treasurer has pled guilty to tax evasion. In emails received by AFFT, the city admitted it had not received annual audit reports from the union for several years, despite the fact that they are required by law. 

LEEBA is one of many unions that contracts with the government to manage employee benefits through an employee benefit fund. The union is then in charge of purchasing and providing things like medical plans for employees in their bargaining unit.

The LEEBA case is just one example of problems that exist for public employees when their employers hand control of managing their benefits over to unions. When the government hands large lump sums of money over to unions to manage employee benefits, there are many opportunities for mismanagement of those funds. Public employers must be willing and able to provide strict oversight if they want to use unions as contractors. 

In another case highlighting the problems with union-run benefits funds, a state employee in New York was told by a member of the human resources department that if he resigned his union membership, he would no longer be eligible for dental or optical benefits because those benefits were provided directly by the union. 

That answer was wrong. Flat-out wrong. And after this employee reached out to AFFT for help, he was able to show the HR staffer how she was mistaken. 

“Public employees in a bargaining unit are entitled to all benefits offered by their employer as negotiated in a collective bargaining agreement, regardless of their union membership,” said Brigette Herbst, organizing director for Americans for Fair Treatment, who helped the employee find the information he needed to show HR. 

“It’s shocking to see that a member of the state’s human resources department didn’t know what she was talking about and passed on false information to the employee,” she said.  

Herbst went on to say that benefits funds are really a way for governments to pass money on to unions, since unions end up contracting the management of benefits out to a third party, in the same way the government would if they were managing the benefits. 

“By giving unions power over employee benefits, government managers are just padding their friends’ pockets,” said Herbst. “It just adds another layer of cost for the government – which isn’t good for taxpayers or the employees, who would probably rather see that money in their paychecks.”

Suzanne Bates

Suzanne Bates is Senior Writer and Researcher with Americans for Fair Treatment, a community of current and former public-sector workers offering resources and support to exercise their First Amendment rights. Prior to joining Americans for Fair Treatment in 2020, Suzanne worked as a journalist for the Associated Press, as Policy Director with the Yankee Institute, as a contributor for The Hartford Courant, and as a regular commentator for WNPR’s The Wheelhouse.